JACKSON, Miss. (AP) - Five state insurance commissioners have sued the Vatican, alleging the church was involved in $200 million-plus insurance fraud scheme run by now jailed financier Martin Frankel.
The federal lawsuit, filed Thursday by the commissioners of Mississippi, Tennessee, Missouri, Oklahoma and Arkansas, accuses the Vatican and Monsignor Emilio Colagiovanni of racketeering and fraud.
"We're not trying to embarrass the Vatican, we're just trying to do what we have to do under the statutes," said Lee Harrell, Mississippi's deputy insurance commissioner. "We wouldn't be suing them if we didn't think they did some things wrong and that they owed us money."
The Vatican said it had no immediate comment on the lawsuit.
The lawsuit says Frankel's insurance companies were "shell" companies and were stealing the assets from the larger insurance companies, Harrell said.
The suit was filed in Mississippi because some 70 percent of the more than $200 million allegedly stolen was looted from Mississippi companies, Harrell said. He said most of the sham offices were based in Franklin, Tenn.
In a January 2000 lawsuit filed against Frankel, the five insurance commissioners are seeking more than $600 million in damages from him.
The states accused Frankel of using pseudonyms and partners to buy small insurance companies in their states, which have reputations for lax insurance regulations. Then, regulators say, Frankel siphoned money from the companies through his unlicensed brokerage run out of his Greenwich, Conn., home.
Mississippi Attorney General Mike Moore has filed criminal charges against Frankel.
Frankel was arrested in Germany in 1999 and is jailed in Rhode Island awaiting trial in U.S. District Court in New Haven, Conn., on charges of racketeering, fraud and conspiracy.
Colagiovanni was arrested in August 2001 on charges of wire fraud and conspiracy to launder money in connection with a multimillion-dollar insurance scam. He is accused of assisting Frankel using the St. Francis of Assisi Foundation to acquire insurance companies, while concealing Frankel's involvement.