Frankel Sought Vatican Help
Four Others Linked To Charity Scheme
March 3, 2003
By DIANE SCARPONI, Associated Press
NEW HAVEN -- The first chapter in the prosecution of thieving financier
Martin Frankel has ended with guilty pleas and one jury conviction for
Frankel and seven key associates in the theft of $200 million from insurance
companies in five states.
Court witnesses have testified that four others helped Frankel set up
a phony Roman Catholic foundation to hide his scheme, which remains under
investigation by federal prosecutors.
Thomas Bolan, a prominent Roman Catholic lawyer and former federal prosecutor
from New York who worked on Ronald Reagan's presidential campaigns.
Thomas Corbally, a New York socialite with ties to the rich and famous
through a private investigation firm.
The Rev. Peter Jacobs, a Roman Catholic priest from New York whose friends
included the late Princess Grace of Monaco.
Thomas E. Quinn of Greenwich, who was barred from practicing law and from
securities trading after a fraud conviction.
Their efforts went as far as filing false papers with Mississippi insurance
regulators, the witnesses said. Some also met with Vatican officials to
persuade them to participate. The church ultimately declined.
Another associate has pleaded guilty in the bogus charity scheme: Monsignor
Emilio Colagiovanni, an Italian national who headed a Roman Catholic foundation
that publishes books on canon law.
Federal prosecutors have said Bolan is a target of the continuing investigation
into Frankel's scheme. They declined to comment on whether the other three
are part of the probe.
Mississippi prosecutors also are continuing to investigate.
"Our intent is to pursue prosecutions of anybody that was down here
helping him do this," said Carla J. Clark, special assistant attorney
Corbally, Jacobs and Quinn could not be reached for comment. Their former
lawyers said they are no longer representing them; some may be living
In previous interviews, some have said that Frankel duped them into thinking
he was an investment tycoon. "I was fooled like everyone else. He
was a consummate liar, a master of deception," Corbally once said.
Under plea deals, Frankel, Colagiovanni and others are required to aid
prosecutors in the investigation.
Bolan was a defense witness in the recent court case of Frankel associate
Mona Kim, despite knowing he is a target of the continuing investigation.
"I was always willing to testify, and there was no question of discussing
taking the Fifth Amendment," Bolan said.
Kim, convicted in January of fraud and racketeering, fled with Frankel
to Europe in May 1999 as insurance regulators began to uncover the fraud.
Bolan said he was introduced to Frankel under the alias David Rosse through
Frankel, unshaven and wearing a bathrobe, met Bolan in the summer of 1998
at his Greenwich house. He told Bolan he was a billionaire who made money
in the stock market, and that he wanted to help the poor by working with
the Vatican, which he thought had the best charitable reputation.
Frankel also said he was an admirer of St. Francis of Assisi and Pope
John Paul II.
"He said, `If you can't trust the pope, who can you trust?'"
Frankel offered to donate $55 million to the Vatican. The church could
use $5 million for whatever it wished, and the remaining $50 million would
be used to buy insurance companies.
Frankel said he would invest the insurance companies' assets and donate
the proceeds to Vatican charities. He wanted to donate the money anonymously,
so that he would not be besieged by other people seeking money.
"I never at any point, until Mr. Rosse fled, had any idea that this
man was a crook," Bolan said. "He always impressed me as the
most compassionate human being."
Bolan suggested Frankel meet with Jacobs, who had Vatican connections,
including Colagiovanni, the head of the Monitor Ecclesiasticus Foundation.
Colagiovanni said anonymity was fine, since Vatican law prohibits revealing
the names of donors, Bolan said.
Bolan and Jacobs met in August 1998 with officials from the Vatican treasury
and the Vatican secretary of state's office.
The secretary of state's office responded that the Vatican did not want
to operate or invest in insurance companies and said Frankel would have
to donate the money some other way.
But later, Colagiovanni said that his superiors authorized him to accept
the $55 million through his foundation. He kept $5 million, and the rest
was sent to the British Virgin Islands under a bogus charity Frankel set
up called the
St. Francis of Assisi Foundation.
Jacobs, Bolan and Quinn were appointed trustees of the St. Francis foundation.
In April 1999, Frankel, Bolan, Colagiovanni and Jacobs traveled to Mississippi
to meet with insurance regulators who were questioning the scheme.
Frankel filed papers with regulators to show that the St. Francis foundation
was taking over the company from the Thunor Trust, which Frankel set up
years ago to buy insurance companies anonymously.
Colagiovanni had signed an affidavit saying that St. Francis' money came
from his foundation and other Catholic sources when he knew the money
actually came from Frankel, federal prosecutors charge.
Bolan said he knew Colagiovanni was wrong and tried repeatedly to correct
him to say that the money came from an unnamed individual.
But, Bolan said, he did not speak up in the meeting with regulators out
of respect for Colagiovanni, a good friend who once blessed Bolan's dying
"At the meeting I did not want to humiliate Monsignor Colagiovanni
and say, `That's not so, Monsignor,'" Bolan testified.
Two days later, Bolan and the other trustees withdrew their application
with Mississippi regulators.
Frankel paid Bolan $175,000. He testified he did not return the money,
even after he found out that Frankel had stolen it, because he had worked
for the money and already had spent it.
Bolan's work was cheap compared to what Frankel paid Corbally, according
to testimony from Karen Timmins, Frankel's former office manager.
Corbally got $1.8 million for a Manhattan apartment, $500,000 worth of
Swiss francs, monthly credit card payments of $15,000 to $30,000 and at
least $10,000 in traveler's checks after each meeting with Frankel, Timmins
Corbally's job was to attract investors to Frankel's scheme. He also got
fake Greek passports to Frankel and others who were planning to flee with
him to Europe as regulators closed in, she said.
"He became involved in all aspects of Marty's business,"
Quinn got about $4 million, Timmins said. Frankel had sent him the money
for safekeeping, but when he wanted it back, Quinn said no and threatened
to beat Frankel's head in with a baseball bat.
"Tom Q. goes crazy. Threatens to kill me," Frankel wrote in
his journal in April 1999.
Jacobs, who had once angered Roman Catholic officials in New York by opening
an expensive restaurant for charity, had his living expenses paid for,
including credit card bills, Timmins said.
All these men knew that it was really Frankel's money funding the St.
Francis of Assisi Foundation, she said.