Vatican bank open to money laundering: Inquiry

Rome, PTI | Updated : 06 July 2013, 04:09 PM

Italian investigators have said that the Vatican bank operated in a way that facilitated money laundering, according to leaked papers quoted by two Italian newspapers on Saturday following a three-year inquiry.

The bank, officially known as the Institute for Works of Religion (IOR in  Italian) did not carry out enough checks on its clients and account holders  were allowed to transfer large sums on behalf of others.

 “There is a high risk that the way the IOR operates, without specifying its  real clients, can be used as a screen to hide illegal operations,” prosecutors  wrote in a document that was quoted by Corriere della Sera.
 
They also faulted Italian banks that accepted transfers from the IOR for  failing to probe the origin of the money, which is then moved into other banks.
 
“The IOR can easily become a channel for the laundering of money with a  criminal origin, they said.
 
They also contradicted IOR statements that its account holders are all  religious congregations or clergy.
 
“There are also private individuals who, because they enjoy a particular  relationship with the Holy See, can deposit money and open accounts,” they said.
 
The investigation centred on a 23-million-euro ($30-million) transfer made  from the Vatican bank to Italian lender Credito Artigiano in September 2010.
 
Three million euros were then sent on to Banca del Fucino and 20 million to  JP Morgan Frankfurt.
 
The transfer was signed off by IOR’s then director general Paolo Cipriani  and his deputy Massimo Tulli, who both resigned last week.
 
Prosecutors are set to file charges against them.
 
La Repubblica said the two were also being accused over a dozen other  smaller transfers to JP Morgan.
 
Pope Francis has set up a committee to investigate the bank and is said to  be planning a major shake-up of the scandal-ridden institution as part of  broader reforms of the Vatican bureaucracy.
 
The Vatican is reforming its finances in order to be included on a “white  list” of states that respect international rules against money laundering.
 
Italian police last month arrested a senior cleric on suspicion of money  laundering and fraud for allegedly plotting to smuggle millions of euros into  Italy.
First Published: Saturday, July 06, 2013 04:03 PM
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