Operation Gladio

by Paul L. Williams

  Other factors contributed to the bank's cash-flow problems as well. Between 1978 and 1980 the Golden Triangle was hit with two severe droughts. The droughts were followed by two seasons of intense monsoon rains, which reduced the region's opium production to a record low. The usual 600-ton opium harvests were cut to 160 tons in 1978 and 240 tons in 1979.37 The natural catastrophes were accompanied by concerted efforts by the Burmese and Thai governments to eradicate poppy production, necessitated by the fact that opium remained the main source of revenue for the Shan guerrilla armies. From 1976 to 1979, the Burmese army destroyed four major heroin laboratories near the Thai border, netting impressive quantities of precursor chemicals.38

  A TURNING POINT

  A turning point had been reached. Southeast Asia could no longer remain the main source of heroin revenue for Gladio. New poppy fields had to be planted in countries that possessed the proper climate and terrain—cool plateaus above five hundred feet. There, the plants would grow rapidly and propagate easily, and the real work came with the harvesting. The poppy heads had to be scraped as soon as the petals fell off, causing the plants to ooze sticky sap that was squeezed into banana leaves.39 Such intensive work required not only a slave labor force but a strong-arm government that could benefit from the production of narcotics. Before the outbreak of the Vietnam War, Turkey was an important source of opium in Europe and the United States. But in 1967 the Turkish government announced its plans to abolish opium production. Within a matter of months, the number of Turkish provinces producing poppies declined from twenty-one to four. The total ban was imposed in 1972.40

  The elite CIA and US State Department officials in charge of Operation Gladio were at their wits’ end. The threat of communism had not been eradicated. The world was still not safe for democracy. The need for black operations was intensifying not only in Italy and South America but also in the Middle East. With the setbacks in Southeast Asia, the source of funding for the creation of the New World Order was in jeopardy.

  In August 1978, when it seemed that matters couldn't get any worse, Pope Paul VI suffered a massive heart attack and died at Castel Gandolfo, and his successor—Albino Luciani, who called himself John Paul I, issued a call for reform.

  I chose the same names as my beloved Predecessor John Paul I. Indeed, as soon as he announced to the Sacred College on August 26, 1978 that he wished to be called John Paul I—such a double name being unprecedented in the history of the Papacy—I saw in it a clear presage of grace for the new pontificate. Since that pontificate lasted barely thirty-three days, it falls to me not only to continue it but in a certain sense to take it up again at the same starting point. This is confirmed by my choice of these two names.

  Pope John Paul II, Redemptor Hominis, March 4, 1979

  Before his death, Pope Paul VI decided to put to task the College of Cardinals by making the process of electing his successor as grueling as possible. Knowing that previous conclaves had been bugged,1 he left instructions that all cardinal-electors swear a solemn oath not to divulge the results of the balloting to any outside source or to discuss the results with other princes of the Church. Swiss Guards were placed outside every entrance and beneath every window, just in case one of the septuagenarian cardinals attempted to escape from a high tower.

  Within the Sistine Chapel, where the conclave was held, the cardinals, who were accustomed to living in regal splendor within luxurious apartments, were confined to single cells without any amenities. Before entering the cells, the cardinals were searched by guards for bugging devices or other means of communication, including pencils and notepads. “The cells have no toilets and no running water,” Cardinal Giuseppe Siri complained to an attendant. “It is impossible to live any longer under these conditions.”2

  “THE STRANGE, LITTLE FELLOW”

  At the start of the conclave, on August 25, 1978, the 111 cardinals were marched in silence to the chapel. The presiding cardinal—the Camerlengo—took roll call and ordered the purpled prelates to kneel while beating their breasts and chanting the Latin hymn, “Veni Creator Spiritus.” Many within the sacred assembly were disgruntled to find that they were not treated like princes of Holy Mother Church but prisoners in San Quentin.3

  To make matters worse, the conclave took place in the midst of an oppressive heat wave. The temperature in Rome soared above ninety-four degrees. The situation within the chapel soon became unbearable, with every door locked and barred and every window boarded and sealed. Small wonder that the traditionalists and progressives came to an immediate compromise by electing Albino Luciani, a “strange, little fellow,” as the new pope.4 The appearance of the smiling new pontiff on the central loggia of St. Peter's Basilica caused noted journalist and Vatican insider John Cornwell to gasp: “My God! That's Peter Sellers! They've made Peter Sellers a pope.”5

  CARDINAL CODY

  The conclave may not have been bugged, but it had been rigged. The CIA was fearful that the cardinals might elect Cardinal Giovanni Benelli, the Archbishop of Florence or Cardinal Aloísio Lorscheider, the leading Catholic prelate in Brazil, as pope. Benelli, a moderate, had been so horrified by the Sindona affair that he called for the removal of Archbishop Marcinkus as the head of the Vatican Bank. Cardinal Lorscheider represented an even more odious choice since he was an advocate of liberation theology. Soon after Pope Paul suffered his first heart attack, the Agency arranged for Cardinal John Cody, the Archbishop of Chicago, to travel to Poland for a meeting with Cardinal Karol Wojtyła, the Archbishop of Krakow, who had attracted the attention of the US intelligence community with his strong stance against Communism and his openness to the strategy of Operation Gladio.6

  Cody, by his own admission, was a CIA operative who had served the Agency since the time of its establishment.7 The cardinal had even been dispatched on mysterious missions to Saigon. In charge of the total assets of the Roman Catholic Church in Chicago—in excess of $1 billion—Cody worked closely with David Kennedy at Continental Illinois, which held the deposits of the diocese. Through Kennedy, the Cardinal developed close relationships with Michele Sindona and Archbishop Marcinkus. During the 1970s, Cody diverted millions of dollars via Kennedy's Chicago bank to Marcinkus at the IOR. Marcinkus, in turn, would channel the money to cardinals in Poland, including Wojtyła.8 The reason for the transfers of such large amounts of money was never adequately explained.

  THE DARK HORSE

  The only ecclesiastical purpose for Cody's trip to Krakow was to cultivate Wojtyła's interest in a dark horse candidacy for the papacy. While Cody remained in Poland, Cardinal John Krol of Philadelphia began to work the phones in support of the little known Pole, who was not a member of the Roman Curia. Krol was a formidable Church figure with high-powered friends, including three former American Presidents—Johnson, Nixon, and Ford.9

  The cultivation of a dark horse was necessitated by the fear that Cardinal Sebastiano Baggio, the prefect of the Sacred Congregation for Bishops, might fail to capture the needed votes for the holy office. Baggio, a prominent member of P2, had served Operation Condor by purging the Latin American Bishops’ Conference of all proponents of liberation theology.10 Moreover, he had openly pledged to conduct business as usual, with Marcinkus and Calvi remaining in control of the IOR.11

  Prior to the conclave, the cardinals with ties to P2 met at Villa Stritch on the outskirts of Rome to plan alternative courses of action during the conclave.12 One alternative was the selection of Albino Luciani as the next pontiff. He was a simple man with a “nervous” smile and an ungainly appearance, who, they agreed, was afraid of his own shadow.

  BOGUS SECURITIES

  The new pope called himself John Paul I and pledged to follow in the footsteps of his two immediate predecessors. And few within the CIA and the Sicilian Mafia fancied him a threat to the existing order of things. But a series of articles appeared on the front pages of leading Italian newspapers and periodicals, including Il Mondo and La Stampa, which called upon the new Holy Father to reform
the Vatican Bank and to put an end to the Church's ties to “the most cynical financial dealers in the world, from Sindona to the bosses of the Continental Illinois Bank in Chicago.”13

  Through Cardinal Benelli, who became his friend and counselor, John Paul was aware of the Vatican's involvement in a plot to sell $1 billion in counterfeit securities. The deal had been forged by Sindona, who made arrangements for the preparation of the bogus securities with members of the Gambino family in New York. To verify the Holy See's involvement in the scheme, Cardinal Eugène Tisserant, dean of the College of Cardinals, had provided the Mafia with a letter bearing the official insignia of the Sacra Congregazione Dei Religiosi.14 Phony bonds from companies such as American Telephone and Telegraph (AT&T), General Electric, Chrysler, and Pan American World Airways were delivered in July 1971 to the IOR. In order to ensure that the bonds would be accepted as genuine, Archbishop Marcinkus made trial deposits at the Handelsbanken in Zurich and at Banca di Roma. The securities were examined and certified as authentic.15

  The problem arose when officials of both banks went with samples of the bonds to examiners at the Bankers Association in New York, who found that the securities were counterfeit. Word went out to Interpol. The Organized Crime and Racketeering Division of the US Department of Justice sought an interview with Cardinal Tisserant, only to learn that the Vatican official had died of natural causes. After questioning Marcinkus, US officials sought an indictment for his arrest. But the Nixon administration called a halt to the probe, and the case against the Archbishop was placed among the dead files of the FBI.16

  THE PRELIMINARY REPORT

  One week after his election, John Paul received a preliminary report on the internal workings of the Vatican Bank from Cardinal Villot, who remained the Holy See's secretary of state. The bank, which had been formed to further “religious works,” was now serving a distinctly secular purpose. Of the 11,000 accounts within its registry, fewer than 1,650 served to further an ecclesiastical cause. The remaining 9,350 accounts served as “slush funds” for special friends of the Vatican, including Sindona, Calvi, Gelli, Marcinkus, and leading Sicilian Mafiosi, including the made men of the Corleone, Spatola, and Inzerillo families and members of the Camorra of Naples and Milan. The Banda della Magliana gang serviced the accounts of Giuseppe “Pippo” Calò, the Mafia's head cashier, who served as the boss of the Porta Nuova clan.17 Other accounts were held by leading Italian politicians and businessmen in service to Operation Gladio; and still others for the foreign embassies of Iran, Iraq, Indonesia, Argentina, Chile, Colombia, and other countries.18 The Santa Anna Gate within Vatican City opened to a busy thoroughfare as thugs with suitcases filled with drug money marched past the Swiss Guards, up the stairs to the IOR. Members of the Italian underworld, for the most part, remained traditionalists, who shied away from electronic bank transfers.19

  FINANCIAL SHENANIGANS

  On September 7, Cardinal Giovanni Benelli, the Archbishop of Florence, conveyed to the Holy Father even worse news. The Bank of Italy was investigating the links between Roberto Calvi of Banco Ambrosiano and the Vatican Bank, including Calvi's purchase of Banca Cattolica del Veneto from the IOR in 1972. This purchase had occurred when John Paul was Archbishop of Venice. The sale had been made without his consultation, let alone that of any other patriarch or prelate. Everything about this transaction was mysterious. Banca Cattolica del Veneto was one of Italy's wealthiest banks, with vast real estate holdings in northern Italy. Calvi, on behalf of Banco Ambrosiano, purchased 50 percent of the shares for $46.5 million (around $2 billion in today's money). But the shares never left the Vatican. Instead the stock was reassigned to Zitropo, a company owned by Sindona. Zitropo was then sold to Calvi and in 1978 the company was acquired by the Vatican. All this time the shares of Banca Cattolica del Veneto never left the Vatican safe.20 The investigators sent a preliminary report concerning these irregularities to Judge Emilio Alessandrini. The final report, Cardinal Benelli told the pope, could result in criminal charges not only against Calvi but also leading Vatican officials, including Archbishop Marcinkus and his two close IOR associates Luigi Mennini and Pellegrino De Stroebel.

  Neither Cardinal Benelli nor the pope were aware that the troublesome matter of Judge Alessandrini was under control and that criminal charges would not be filed against Calvi and his IOR cohorts. On January 29, 1979, five gunmen murdered the Italian magistrate, when his orange Renault 5 stopped for a red light on Via Muratori in Rome. The action accomplished its purpose. The investigation of Calvi and the Vatican officials came to an abrupt halt.21

  MASONIC CABAL

  The most appalling revelation came on Tuesday, September 12, when John Paul sat down at his desk to discover the latest copy of L'Osservatore Politico. This newsletter, published by Mino Pecorelli, contained a list of 121 leading Catholic clerics and laymen who were members of Masonic lodges with alleged ties to Licio Gelli and P2.22 If the list proved accurate, the pope would have no recourse save to strip the cardinals, archbishops, bishops, and monsignors of their titles and offices and to subject them to the rite of excommunication in accordance with canon law. This action would constitute a pogrom of the papabili—the individuals closest to the Chair of St. Peter.23 At the top of the list was the name of Cardinal Jean Villot, the Vatican secretary of state. Villot's Masonic name was “Jeanni” and he had enrolled in a Zurich lodge (#041/3) on August 6, 1966.24

  The pope sought to see if the information was accurate by making contact with Italian officials through his close friends, Cardinal Pericle Felici and Monsignor Giovanni Benelli, whose names did not appear in the newsletter. Since all secret societies in Italy must register the names of their members with the state, officials were able to locate Italian masons of the Zurich lodge who confirmed that Cardinal Villot, indeed, had been inducted into the Order of Freemasonry.25

  Another name on the list was that of Villot's assistant, Cardinal Sebastiano Baggio, Masonic name “SEBA,” Lodge #85-1640, date of initiation: August 14, 1967. Again, the pope and his associates made contact with the authorities and received confirmation that Cardinal Baggio, indeed, was a Mason in good standing. By the end of the day, John Paul had received verification of the membership of other leading Catholic dignitaries in Masonic lodges, including Monsignor Agostino Casaroli, his foreign minister; Cardinal Ugo Poletti, the vicar of Rome; Monsignor Pasquale Macchi, who had been Paul VI's trusted secretary; and, last but not least, Archbishop Paul Marcinkus, who controlled the vast wealth of Holy Mother Church.26

  A MILQUETOAST AT HEART

  John Paul, however, was neither a spiritual warrior nor a determined reformer. Of all the popes of the twentieth century, he was, perhaps, the most timorous. On one occasion, when a gust of wind blew a score of documents from his hands to the roof of the Apostolic Palace, John Paul became so distraught that his attendants had to place him in bed, where he remained with a rosary between his fingers until the papers were found.27 Nevertheless, reliable sources contend that the new pope was moved to action as he learned more and more about the inner workings of Vatican, Inc. According to author David Yallop, John Paul announced on September 28 his decision to remove Archbishop Marcinkus from the IOR, to transfer Cardinal Baggio to the diocese of Florence, and to force Cardinal Villot into retirement. This contention is supported by declassified documents from the US Department of State and the CIA.28

  The presumed papal simpleton, who ceaselessly spoke to his friends and associates about his fondness for Pinocchio, seemed suddenly set on becoming a real pope. It was 1978. The strategy of tension was still in effect. Aldo Moro remained intent on forming a coalition government with socialists and Communists. Liberation theology continued to spread throughout Latin America, giving rise to left-wing guerrillas and left-wing governments. The CIA had lost its connection to the drug lords of Southeast Asia and was engaged in a new search for opium to fund its black operations. All matters—including the utilization of the offshore corporations set up by Sindona and Calvi—await
ed final resolution. The timing could not be worse for an upheaval within the IOR.

  THE MACABRE GRIMACE

  The morning after John Paul made these alleged announcements, he was found dead under conditions that continue to baffle investigators. At 4:30 a.m., Sister Vincenza, following her morning routine, knocked at the door of the papal bedchambers and left a pot of coffee on a table in the hallway. When she returned a half hour later, she found the tray untouched. After knocking at the door and receiving no reply, she called out: “Buona serra, Papa.” The room was still. Entering the room, she found the pope sitting up in bed with his eyeglasses half off his nose. His fingers were clutched around a file, and papers were strewn among the bed covers. As soon as she approached him, Sister Vincenza reeled back in horror. The pope's lips were pulled back in a macabre grimace; his gums were exposed; and his eyes appeared to have popped from their sockets.29

  The nun shrieked with alarm and pulled a bell to summon Fr. John Magee, John Paul's secretary. As soon as Magee saw the pope's condition, he telephoned Cardinal Villot, who occupied an apartment within the Lateran Palace. Villot, according to Vatican sources, uttered in French the following cry of surprise: “Mon Dieu, c'est vrais tous ca?” (“My God, is all that true?”). Then he asked Magee an extraordinary question: “Does anybody else know the Holy Father is dead?” Magee replied on the phone that no one knew except the Vatican nun. Villot then told Magee that no one—not even Sister Vincenza—must be allowed to enter the pope's bedroom and that he, as the Vatican Camerlengo (“presiding Cardinal”) would handle matters as soon as he arrived.30