Filing suit against the Vatican Bank

re the Frankel case

The scam that threw these unlikely antagonists together began in 1998 when Frankel formed a bogus Catholic charity, the St. Francis of Assisi Foundation, with $55 million.

The Vatican got $5 million of the seed money, according to court documents. Colagiovanni agreed to oversee St. Francis and vouch for it with investors.

Frankel would control the remainder of St. Francis funds. He used the money to buy financially desperate insurance companies, then spent policyholders’ money on drugs, diamonds, sex clubs, vacations, cars, call girls and Concorde tickets, prosecutors said.

The Vatican became involved with Frankel after he had been banned by the U.S. Securities and Exchange Commission from doing deals with brokers and investment advisers. The 1992 ban forced Frankel on a quest for new partners with prestige and deep pockets.

By 1998, Frankel had an entree to the Vatican: Bolan. A fervent Catholic and Roy Cohn’s ex-law partner, Bolan, now 79, had raised millions for Vatican charities and Ronald Reagan’s re-election campaign.

Frankel paid Bolan more than $75,000 in legal fees, court documents show. In return, Bolan introduced Frankel to influential priests like Jacobs and the Vatican equivalent of Fed chairman Alan Greenspan – economic affairs prefect Bishop Francesco Salerno. Bolan’s attorney, Maurice Nessen, did not return calls for this story.