A European financial crimes watchdog on Dec. 15 called on the Vatican to prosecute those caught money laundering, stating the Holy See must act to ensure the success of its financial reforms.
“There is a need now for the anti-money laundering and counter terrorist financing system, to deliver effective results in terms of prosecutions, convictions and confiscation,” said the report by the Council of Europe’s Moneyval oversight agency.
Although the Holy See has adopted new legislation in recent years to tackle money laundering within the city-state, there have been no indictments or prosecutions as a result of the new rules.
Pope Francis’ promised reforms of the Vatican bureaucracy are starting to take shape, with new leaders appointed to oversee the troubled Vatican bank and plans to overhaul the Catholic Church’s approach to global communications.
Six new lay members, including Mary Ann Glendon, a former U.S. ambassador to the Holy See and Harvard law professor, will join the bank’s board.
Profits plunged by more than $100 million at the Vatican bank last year after thousands of accounts were shut down in a radical overhaul of the scandal-scarred institution.
In its 2013 annual report released Tuesday, the bank, officially known as the Institute for Religious Works, said its net profit totaled 2.9 million euros ($3.9 million) last year, a dramatic drop from the 86.6 million euros ($117.8 million) it reported in 2012.
The bank said the slump was due to extraordinary expenses, losses related to externally managed investment funds and fluctuations in the price of gold.
Losses included a controversial $20.5 million loan granted to a production company owned by a friend of Cardinal Tarcisio Bertone, the former Vatican secretary of state who has faced criticism for mismanagement as the church’s No. 2 official under retired Pope Benedict XVI.
Pope Francis and his council of eight cardinals are unlikely to complete a radical shakeup of the Holy See’s administration, or Curia, before 2015, the Vatican said Tuesday.
Francis joined the council’s discussions in between events on an intense appointment schedule that included an audience with King Juan Carlos of Spain after the historic double canonizations of Popes John Paul II and John XXIII on Sunday.
Pope Francis on Monday launched a sweeping reform of the Vatican’s scandal-plagued financial system by naming one of his closest advisers on reform, Australian Cardinal George Pell, to head a powerful new department that will oversee the Vatican bank and the entire economic system of the Holy See.
The new Secretariat for the Economy, with Pell acting as a unique kind of Vatican comptroller, will have “authority over all economic and administrative activities” in the Vatican, according to a statement summarizing Francis’ decree.
The changes also provide for an official who will be empowered “to conduct audits of any agency of the Holy See and Vatican City State at any time” — a remarkable degree of authority in a bureaucracy where offices are known for zealously guarding their own turf.
Two top managers of the Vatican Bank resigned on Monday, just five days after Pope Francis appointed an independent commission to conduct a top-to-bottom review of the scandal-plagued bank.
The surprise resignation of the bank’s director general, Paolo Cipriani, and of his deputy, Massimo Tulli, follows the arrest of a senior Vatican official with close ties to the bank who was charged on Friday with attempting to smuggle 20 million euros into Italy from Switzerland.
Cipriani, 58, served as the bank’s director general since 2007 and will be replaced on an interim basis by the bank’s president, German financier Ernst von Freyberg, who was appointed last February in one of Pope Benedict XVI’s last official acts.
As the Vatican prepares for the opening of the conclave today to elect a new pope, officials announced that the personal secretary of former Pope Benedict XVI will return to Rome for the first time since Benedict’s resignation on Feb. 28.
The Vatican’s chief spokesman, the Rev. Federico Lombardi, confirmed on Monday that Gaenswein will be one of the senior Vatican officials to take part in the solemn procession of cardinals into the Sistine Chapel that will open the conclave on Tuesday afternoon.Archbishop Georg Gaenswein, who was Benedict’s closest aide when he was pope, moved with Benedict to the papal summer residence of Castel Gandolfo when the retired pope left the Vatican on Feb. 28.
His presence will once again highlight the unprecedented situation — and potential complications — of having a retired pope still living just as cardinals gather to elect his successor.