Nation: Account Settled

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Sindona guilty of bank fraud

He was known to rivals as "mysterious Michele" for his deft behind-the-scenes maneuvers. Son of a Sicilian farm worker, Michele Sindona, 59, worked his way up to become the legal and financial adviser to important Italian companies, the Vatican and, some say, the Mafia. Creating his own holding company, he amassed a $450 million fortune. In 1972 Sindona purchased controlling interest in Long Island's Franklin National Bank, the 20th largest in the U.S. Two years later, Franklin National collapsed, the biggest bank failure in U.S. history, and the Government blamed mysterious Michele.

The U.S. charged that Sindona had illegally transferred $40 million from banks he controlled in Italy to buy Franklin National, then removed $15 million from the bank and concealed $30 million in foreign currency speculation losses.

In August, just before his trial was to begin, Sindona disappeared. When he surfaced eleven weeks later, he had a bullet wound in his leg and swore he had been kidnaped by Italian terrorists. His defense later admitted that the tale was a hoax, and the bullet wound was never explained. Nor did Sindona ever say what he had done in Europe. Prosecutors at the trial suggested he had gone abroad to try to fake documents for his defense.

The Government had been planning to build its prosecution around the testimony of Giorgio Ambrosoli, who had been appointed by a Rome court to liquidate the Sindona-controlled Italian banks that had collapsed along with Franklin National. But last July, Ambrosoli was killed in Milan, and Italian police have not charged anyone with the shooting.

For all its lurid preliminaries, Sindona's trial turned out to be largely a cram course for the jury in accounting and the subtleties of foreign exchange trading. "This trial," complained a reporter from Milan, "it is arithmetical, not passionate." Still it did have its moments. The star witnesses against Sindona were Carlo Bordoni and Peter Shaddick, who had already been convicted of fraud in the case. Sindona's attorney tried to show that Bordoni was prejudiced against his client and got him to claim that Sindona had tried to rape his wife. Having provoked the charge, the defense denied that Sindona had committed the act.

Last week the jury found Sindona guilty on 65 counts of conspiracy, fraud and perjury. Even if his appeals fail, however, Sindona is unlikely to get more than five years in jail. This will leave plenty of time for authorities in Italy, where statutes of limitations are up to 15 years, to continue trying to extradite him for trial on charges of fraudulent bankruptcy, which could carry a 15-year penalty.