* Pilgrims stunned by scandal
* Fear could cause lasting damage to Church
* Stand by pope
By Silvia Aloisi
VATICAN CITY, May 29 Clerics and pilgrims visiting St Peter's basilica on Tuesday expressed shock over a scandal that has shaken the Vatican and led to the arrest of the pope's butler, fearing it would hurt both the pontiff and the Church.
"It's awful and very sad that something like that can happen right at the heart of the Vatican," said David Kaberia, a priest from Meru in Kenya, standing under the sun in a queue snaking through half of St Peter's Square to tour one of the holiest sites of Roman Catholicism.
"This is an inside job by greedy people and I think it will inevitably affect the Church worldwide because this is the centre of the Church's power," he told Reuters.
The scandal exploded last week when, within a few days, the head of the Vatican's own bank was sacked, the pope's butler was arrested over leaks of sensitive documents and a book was published alleging conspiracies among cardinals and corruption in the Church's financial dealings with Italian business.
"This is a warning for all of us in the Chuch community, that we should only look after spiritual things and not be corrupted by matters of money, career and power," said Father Francesco, a priest frorm Florence.
Italian press reports quoting leakers said the butler, who had access to the pope's private apartment, was merely a scapegoat in a behind-the-scenes struggle for power in the Holy See and that the plot went much higher and wider than him.
"I am not so shocked by the idea that bad apples also exist in the Church, people who are after money and influence," said a teacher from Pordenone, in northern Italy, who gave her name only as Lucia.
"What pains me is that it can get so close to the pope, it's an attack on him while he should be untouchable," she said.
Critics of Pope Benedict say a lack of strong leadership has opened the door to infighting among his powerful aides, and potentially to the corruption alleged in some of the leaked documents.
FAITHFUL STAND BY POPE
But nuns and priests mingling with thousands of lay visitors to catch a glimpse of St Peter's imposing dome, designed by Italy's greatest Renaissance masters including Michelangelo, stood by the ageing pontiff and said they hoped he could quickly draw a line under the worst crisis in his papacy.
"We all feel involved because we are a big family. But as the Bible teaches us, in every family there is a Judas, there is temptation and betrayal, but also repentance and forgiveness" said Estrella Villaran, a Peruvian nun with the Franciscan Sisters of the Sacred Heart.
"This is a test for the pope, but it also an opportunity to relaunch the church and make it stronger," she said, clutching a wooden cross in her hand.
Jay Finelli, a diocesan priest from Rhode Island in the United States, dismissed concerns that the scandal could cause lasting damage to the Holy See.
"The Church is made up of saints and sinners, so we just have to pray and God will sort it all out," he said.
"We have been around for 2,000 years. Of course people must be wondering what's going on, but nothing can destroy the Church. The gates of hell will not prevail."
Even non-believers who came to admire the frescoes of the Sistine Chapel were surprised by news of the butler's arrest, with one Californian tourist, Kay Prichard, comparing it to the intrigues of Dan Brown's bestseller "The Da Vinci Code".
Others said they were worried, but for different reasons.
"I just hope it does not hurt business here," said Josef, an illegal street hawker from Afghanistan who promises tourists he can help them jump the long queue for a guided tour of St Peter's Basilica for 45 euros.
(Reporting By Silvia Aloisi; editing by Barry Moody)