Religion : American Prelate Retires From Vatican Service : Papacy: Archbishop Marcinkus will serve as parish priest in Chicago. Former bodyguard to Pope, he was president of bank rocked by scandal.

After four decades abroad, Archbishop Paul C. Marcinkus, the best known--and most controversial--American prelate at the Vatican, has retired from papal service to return to his native Chicago as a parish priest.

Built like a linebacker, his street Chicago accent and idiom unblunted by 40 years of Vatican propriety, Marcinkus first drew international attention as the Pope’s chief bodyguard and later as the hapless president of a Vatican bank rocked by monumental financial scandal.

Marcinkus, the 6-foot, 4-inch son of a Lithuanian window cleaner in Cicero, Ill., said in a brief statement Tuesday that he would return to the United States “to make myself useful in whatever pastoral work I may be able to do, much like many priests of my diocese are doing.”

Pope John Paul II accepted the 68-year-old Marcinkus’ resignation as deputy governor of Vatican City at his request, the Vatican announced Tuesday, and named him to an honorary post as a consultant to the city-state.

In a statement, Chicago Cardinal Joseph Bernardin praised Marcinkus’ “great dedication to the church and his personal integrity,” saying “the door to his home diocese will always be open to him.”

Marcinkus, an avid sports fan who reminisced with gusto one recent night about his adventures trying to teach Italian boys to play baseball, retained his Vatican City post after resigning in March, 1989, as president of the Vatican bank, called the Institute for Religious Works, after 19 years.

His presidency was marred by Italy’s largest postwar banking scandal, which cost the Vatican $250 million in a 1984 goodwill settlement to creditors of the failed Banco Ambrosiano. The bank, which collapsed in 1982 with the still-unresolved disappearance of $1.3 billion, was Italy’s largest private bank. The Vatican was a major shareholder.

Two Italian bankers with whom Marcinkus dealt, Roberto Calvi and Michele Sindona, were convicted of fraud after their banks collapsed. Both died mysteriously--Sindona in jail and Calvi hanging from Blackfriars Bridge in downtown London in 1982.

Marcinkus has always staunchly denied any wrongdoing, and the Vatican has supported him, insisting while making the $250-million settlement that it bore no moral or legal blame for the Ambrosiano collapse.

On foreign trips of Pope Paul VI and John Paul II, Marcinkus often ran broad-shouldered interference as unofficial chief bodyguard. In 1987, Italian prosecutors issued warrants for Marcinkus and two lay officials at the Vatican bank, accusing them of being accessories of Banco Ambrosiano’s fraudulent bankruptcy. An Italian court ruled that Italian officials had no jurisdiction over the papal enclave, which is surrounded by Rome but recognized as a sovereign city-state.

For nearly a year, Marcinkus made no secret that he was lobbying for retirement. As its acceptance was announced Tuesday, he told an Associated Press reporter: “I don’t want to have sour grapes. I want to leave here on a happy note.”