United States Attorney's Office District of Connecticut
Press Release

ANOTHER INDIVIDUAL INVOLVED IN FRANKEL SCHEME PLEADS GUILTY, SENTENCED

Kevin J. O'Connor, United States Attorney for the District of Connecticut, today announced that Father PETER JACOBS, age 78, of Rome, Italy, has pleaded guilty to his involvement in Martin Frankel's multi-million dollar fraud against several insurance companies. In proceedings this morning before Senior United States District Judge Ellen B. Burns in New Haven, JACOBS pleaded guilty to a one-count Information charging him with conspiracy to commit wire fraud and to launder money. Pursuant to a plea agreement between JACOBS and the Government, Judge Burns immediately sentenced JACOBS to a five-year term of probation.

According to documents filed with the Court, in 1998, JACOBS was introduced to Martin Frankel as "David Rosse," a wealthy individual who had an interest in furthering the work of the Catholic Church through charitable donations. JACOBS understood that Frankel wanted to establish a foundation, within and under the auspices of the Vatican. The Foundation would acquire insurance companies and, when the companies were sold, the profits would belong to the church. In order to further explore this goal, JACOBS introduced Frankel to Monsignor Emilio Colagiovanni, the President of the Monitor Ecclesiasticus Foundation. JACOBS, Colagiovanni and another person then traveled to Connecticut to meet with Frankel. At this meeting, Frankel offered to donate a large amount of money to the Catholic Church and sought to establish a foundation at the Vatican. Thereafter, JACOBS introduced another person to Vatican officials in Rome for the purpose of discussing the donation and the proposed foundation so as to seek Vatican approval.

Ultimately, JACOBS learned that Frankel intended to donate $50,000,000 to the Foundation, but that Frankel would maintain control of the monies and the investments made by the Foundation. He also understood that Frankel's involvement with and control over the funds of the foundation was to remain concealed. Later that year, JACOBS learned that Frankel had established his own foundation, the Saint Francis of Assisi Foundation ("SFAF"), and that Frankel wanted to conceal his funding of this foundation by transferring funds from his own accounts, through an account in the name of the MEF, to accounts of the SFAF, with his ultimate use of the funds being the purchase of United States insurance companies. JACOBS agreed to be named as a proxy on an MEF account to be held at the Vatican Bank in connection with Frankel's plan, though the precise purpose for such was not explained to JACOBS. JACOBS then executed documents for the Vatican Bank reflecting his status on this account.

JACOBS further agreed to be both the "President" and/or "Trustee" for the SFAF, even though he did not maintain decision making authority independent of Frankel. JACOBS recognized that he was being asked to, and he agreed to, make misrepresentations regarding the source of funding for the SFAF, specifically, that the funds were received by persons or entities other than Frankel, who JACOBS knew to be the true source of the funds. For his part, Frankel agreed to donate $5 million to the MEF, which would be available for charitable purposes.

In April 1999, JACOBS traveled from Rome to the United States to appear at a government regulatory hearing in Mississippi. On April 29, 1999, JACOBS and others attended a meeting in Jackson, Mississippi with officials of the Mississippi Insurance Department. During the meeting, false representations were made to the effect that the funds provided by the MEF to the SFAF for the purchase of insurance companies had been obtained from the Vatican. JACOBS also signed an affidavit in which it was falsely represented that the MEF had donated over $1.2 billion to the SFAF.

Martin Frankel pleaded guilty to his involvement in this scheme in May 2002 and is awaiting sentencing. Monsignor Emilio Colagiovanni also pleaded guilty and on September 9, 2004, Judge Burns ordered him to pay a fine in the amount of $15,000.

This case was investigated by the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. This matter is being prosecuted by Assistant United States Attorney Kari A. Dooley.

CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov