.- A federal court’s dismissal “with prejudice” of a 2002 lawsuit by five U.S. state commissioners against the Holy See shows the Vatican had “nothing to do” with a multi-million dollar criminal scheme against insurance companies, the Holy See’s U.S. attorney Jeffrey Lena said.
The suit charged that the Holy See had engaged in criminal fraud and racketeering in violation of federal law.
The allegations against the Holy See “make good fodder for conspiracy theorists,” said Lena, who added that journalists who “enthusiastically” publicized the allegations should “write with equal vigor upon the cases’ demise.”
State insurance regulators sued the Holy See for $600 million in 2002 in connection with the actions of financier Martin Frankel.
Frankel and his co-conspirators allegedly acquired several insurance companies from 1991 to 1999 in Mississippi, Tennessee, Missouri, Oklahoma and Arkansas and illegally used the companies’ money for his own gain.
The Vatican was first approached by Frankel’s associates under the false pretense that Frankel, who used the pseudonym “David Rosse,” was a wealthy U.S. financier who wanted to donate millions of dollars to the Church to help the poor, Lena said in a Feb. 2 statement.
Frankel proposed the creation and funding of a charitable foundation in the Vatican, allegedly intending to use the foundation in an ongoing scheme to buy insurance companies and illegally exploit them.
“The Holy See categorically rejected the notion that ‘Rosse’ could ever create a Vatican foundation,” Lena said, citing a 1998 letter from then-Holy See Secretary of State Cardinal Angelo Sodano which said no such foundation could ever be created.
Frankel then created a false foundation in the British Virgin Islands named the St. Francis of Assisi Foundation to Serve and Help the Poor and Alleviate Suffering. He claimed the organization was affiliated with the Holy See and that John Paul II had personally authorized the funding.
According to Lena, the Vatican never received any money from Frankel.
“Through these machinations, the Holy See became the unwitting victim of Frankel’s fraud, which sought to trade on the Holy See’s name and reputation to continue to purchase and loot insurance companies,” the attorney commented.
Lena said the lawsuit was filed despite the fact that the Holy See never received money from Frankel.
The lawsuit was not dismissed because of a settlement agreement, he added. Rather, the insurance commissioners filed for dismissal of their own accord.
“As today’s dismissal with prejudice shows, the state insurance regulators’ decision to sue the Holy See for Frankel’s crimes was unsupported by the evidence,” said Lena, who reported that before the lawsuit was filed two government investigations concluded that state insurance regulators had allowed Frankel’s scheme to continue uninterrupted.
Lena suggested that state regulators sued the Holy See despite the findings of the U.S. Government Accounting Office and the Tennessee Comptroller that they bore “much of the blame” for allowing the scheme to continue.