Penny Lernoux

In contrast to a hypergeneralising style common in conspiracy talk (and political talk), Penny Lernoux wrote about high-stakes conspiracies without relying on group abstractions, capitalized nouns or other rhetorical crutches. Her book, In Banks We Trust (IBWT) overwhelms with verifiable specifics – names, dates, places, etc, and avoids what RAW called “panchrestons” (explanations that seem too broadly inclusive and ‘low-resolution’).

I first heard Bob mention IBWT in the late 1980s (during a talk, I think*). He seemed very interested in the “God’s Banker” case (Roberto Calvi/P2/Vatican); he said he bought and read all the books covering the subject – IBWT was one of them. He then revisited the theme, sometimes at length, in several of his own books. You can find RAW’s references to Lernoux’s book in the following:

The Widow’s Son  (footnotes, pages 300-301 of my 1989 Lynx edition)
Cosmic Trigger II  (‘The Friends of Roberto Calvi’)
Everything is Under Control  (section devoted to IBWT)
Chaos and Beyond  (chapter eight)
TSOG  (chapter titled ‘TSOG: The Thing That Ate the Constitution’)
Coincidance  (‘The Godfathers and the Goddess’)

(And probably in a few others. He certainly mentioned IBWT in several talks, articles, interviews, etc).

In Everything is Under Control, Bob remarks that “Lernoux is particularly good at explaining clearly the labyrinthine system of drug deals involving the World Finance Corporation in Miami, Cisalpine Bank in the Bahamas, and the P2 group in Italy, and the links of all of them with the CIA.” (EIUC, pages 250-251, Harper Perennial edition, 1998)

But those expecting something akin to a Netflix series – with accompanying content warnings: DRUGS WEIRD VATICAN NAZI SEX ARCHBISHOPS MAFIA CIA VIOLENCE (etc) – may be disappointed, as IBWT doesn’t have a sensational tone (although imaginative screenwriters could probably create a dramatic TV series by using its content as a starting point).

Mickey Mouse ears & sheik’s robe

Not directly related to God’s Banker, RAW also cited Lernoux’s surreal story of William G. Patterson, vice president in charge of loans at Penn Square Bank in Oklahoma City:

‘Patterson poured out money as though he owned the mint. One borrower of $7 million said that on the day he met with Patterson to propose a large, unsecured loan, the banker was wearing his Mickey Mouse cap. “He just listened and said, ‘I think we can handle that’ ” – all the while “tugging on those strings on each side of the hat that make the ears wiggle.”
– Lernoux, IBWT (citing The Wall Street Journal, July 27, 1982)

Patterson, age 34 at the time, was in charge of 80% of the bank’s loans, but had no previous lending experience, according to Lernoux.

Incidentally, there’s a slight misattribution in some of Wilson’s citations – eg in Everything is Under Control and The Widows Son. Lernoux doesn’t in fact write that Patterson also dressed as an Arab sheik for an executive conference, but that John R. Boyd did (Boyd knew Patterson, and was in charge of energy loans at a different bank – Seattle-First National). Patterson did however sometimes wear a “hollowed-out duck decoy” around the office, according to IBWT.

Reality is What You Can Get Away With

I didn’t read IBWT until after the 2008 global banking meltdown (I couldn’t get hold of the book in England, pre-internet 80s/90s, when RAW mentioned it a lot). So I’d already read books on the 2007-2008 financial crisis (John Lanchester’s Whoops! sticks in my mind) by the time I read IBWT.

Lernoux covers the period leading up to the early 1980s (with Reagan/Thatcher in the ascendant). What struck me reading IBWT was the seemingly reckless belief in their own infallibility that the 70s/80s bank execs exhibited – like aggressive booze/cocaine-fuelled gamblers on an apparent winning streak – and the absence of any reining in by regulatory bodies. In fact, pretty much like the descriptions I’d read of the milieu that led, three decades later, to Credit Default Swaps becoming the financial WMDs that shattered the world economy.

Lernoux comments on Citibank and the U.S. Securities and Exchange Commission (SEC), citing a 1982 report:

‘After proving conclusively that Citibank had been systematically breaking the law, the SEC’s enforcement staff refused to take any action against the bank on the ground that its pursuit of unlawful profits accorded with “reasonable and standard business judgment.” The SEC also concluded that Citibank’s management had no duty to disclose improper actions since the bank had never claimed its top officers possessed “honesty and integrity.” ‘
– Lernoux, IBWT (Chapter Two)

Incidentally, the chairman of the SEC, and head of its enforcement division, were both Ronald Reagan appointees. The latter (John Fedders) was reported by The New York Times (18 Feb 1982) as saying “I do not subscribe to the theory that a company that violates tax and exchange control regulations is a bad corporation.”

‘CUT TO:  RONALD REAGAN saying “I don’t remember.” This clip repeats five times, each time at slower speed so his voice grows more slurred with each rerun.’
– Robert Anton Wilson, Reality is What You Can Get Away With


So far we’re only upto chapter three of IBWT. CIA subversion of international politics begins in Chapter four, which looks at the Nugan Hand Bank in Australia.

In 1980, Frank Nugan, co-owner of the bank, was found dead in his car in a puddle of blood. Beside the body were a rifle and a bible with a meat-pie wrapper as bookmark. On the wrapper were written the names of William Colby (former CIA director) and Bob Wilson (not our Bob, but a Republican Congressman).

As Penny Lernoux points out, the bank officers of Nugan Hand “read like a Who’s Who of the CIA”. Its main business was laundering money from the heroin trade. Michael Hand, the bank’s other co-owner – a former green beret who claimed he worked for the CIA – went into hiding following the bank’s collapse in 1980. He was recently traced and filmed by the TV show, 60 minutes (Australia).

It seems quite a story. Pine Gap, a Pentagon-operated satellite surveillance base in the middle of Australia, was repeatedly criticised by Australia’s Labor Prime Minister, Gough Whitlam – which aggravated US and Australian intelligence (Whitlam had also condemned Nixon for the bombing of Hanoi). Nugan Hand bank was apparently used to fund operations planned jointly by the CIA and ASIO (Australian Intelligence) to destabilize Whitlam’s Labor government. According to Lernoux, the bank “played an important role” in the government’s fall in 1975 “by financing bugging and forgery operations.”


The second half of IBWT covers the following: corrupt bankers in Florida and Miami; connections between drug-money laundering, Latin-American terrorists and US intel agencies; the World Finance Corporation; relocation of Nazis such as Klaus Barbie… and finally goes into detail on the involvement of the Vatican bank and members of P2, with a detailed look at the activities of Michele Sindona (the mob-connected banker, P2 member, Vatican Bank adviser… and later convicted murderer).

“While checking Sindona’s abduction story, in March 1981 the Italian police obtained a warrant to search the Arezzo villa of P-2 Masonic master Licio Gelli. There they discovered a cache of sensational documents, among them a list of 953 P-2 members, including: the heads of Italy’s intelligence agencies; numerous generals and admirals; and key men in government ministries, the courts, industry, banking and the press… The revelations set off a major scandal in Italy, causing the fall of the government of Arnaldo Forlani.”
– Lernoux, IBWT (Chapter Nine)

Along with the accounts of rightwing political conspiracies (eg “the strategy of tension”), murder and bombings, Lernoux also provides interesting incidental detail – eg Sindona’s compulsion to fold origami boats of a kind called “heaven and hell” (they filled his desk, apparently): “Moving his hands one way, he would make the inside of the boat open on blue paper, for heaven; moving them another way, the interior would be red, for hell.”

How to report conspiracies

For those inclined to obtain IBWT, I repeat what I wrote above: don’t expect sensational drama – the prose style leans towards “thoroughgoing” and understated rather than “electrifying bestseller”. It serves as a journalistic model, providing a stark contrast to the “WTF clickbait” type content popular at present.

At the beginning of each chapter, Lernoux gives us a “ROGUES’ GALLERY”, listing the names of the key figures implicated. IBWT was published in 1984 (Lernoux began her research in 1980), when much of the malign/criminal activity described (or corresponding investigation into it) was still ongoing – with the named parties in many cases still at large, and presumably not wanting bad publicity. Four decades later, it seems easy to forget the bravery that was probably required to go public with much of this material.

The UK Observer/Guardian ran a couple of updates on the “God’s Banker” story in 2003 and 2012.

* Here’s one talk given in Britain that I remember – RAW mentions the Calvi/Vatican case, and cites David Yallop and Stephen Knight, but not Lernoux on this recording.

One thought on “Penny Lernoux

Add yours

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Blog at

Up ↑

%d bloggers like this: