Mr Martelli, the former right- hand man to Bettino Craxi, the discredited Socialist leader and former prime minister, has been spearheading the campaign to unseat his former boss, presenting himself as the clean, younger-generation leader able to save his moribund party. His resignation is clearly intended to preserve this image, for such a move is by no means automatic in Italy and other politicians have preferred to cling to their jobs no matter what the charges against them.
Mr Martelli's name was dragged into the morass of corruption investigations by Silvio Larini, a close friend and associate of Mr Craxi who, after several months in apparently luxurious hiding in France, Switzerland and a south Pacific island, gave himself up to the Italian authorities at the weekend and started telling at least part of what he knew.
One of the things he knew about was a numbered account with the Union des Banques Suisses in Lugano, which he reportedly confessed was opened in his name and into which the Socialist Party allegedly had some of the vast proceeds from corruption paid. And in particular a certain sum of dollars 7m ( pounds 4.9m) allegedly paid in by Roberto Calvi, the crooked former head of the Banco Ambrosiano, on behalf of his ally Licio Gelli, the sinister spider at the centre of the P2 Masonic web of conspiracy to subvert and take over Italy.
The money was allegedly a kickback on a loan which the Socialist leaders had organised to help bail out the ailing Banco Ambrosiano. Rumours that Mr Martelli was connected with the account have been circulating since investigations into the P2 plot started 12 years ago and he has always flatly denied them. Learning that formal investigations were now to be opened against him he resigned.
According to leaks from the Milan public prosecutor's office, Mr Larini has also allegedly stated that millions of pounds' worth of kickbacks from work on the Milan underground railway were actually destined for Mr Craxi himself. Mr Larini is involved in a company that technically owns a beautiful villa in Hammamet, Tunisia, where members of the Craxi family spend their holidays.
Mr Larini's return and his confessions came only a couple of days ahead of the Socialist Party national assembly, due to open tonight, in which Mr Craxi is supposed to bow out and a successor be nominated. Mr Martelli yesterday also resigned from the party and probably will not be there, but in any case his bid seemed doomed as it would have hopelessly divided the leadership.
Who will take over from Mr Craxi after 15 years of autocratic leadership, and try to salvage the century-old party that is rapidly losing almost all the voters it had, is still undecided. The Socialist secretariat, which failed to produce a successor on Tuesday night, meets again this morning, and the assembly is due to vote tomorrow.
Mr Craxi has received notifications of four separate investigations against him for corruption and related crimes. But the scandals involve the other ruling parties too. This week the former Christian Democrat party (DC) secretary, Arnaldo Forlani, the head of DC's Rome branch, Vittorio Sbardella, nicknamed 'The Shark', and two leading members of the Republican Party have either been served notice of investigations or allegedly been implicated by witnesses.Reuse content