HOW DOES A BANK BECOME INVISIBLE?
Before this day in 1942, none of the cardinals even knew the room existed. Behind the heavy doors is a long table. A stout man with a beard sits at its head. His expression is serious. Bernardino Nogara is a financial advisor to the Vatican, as well as the organisation’s treasurer – and what he’s about to say will change the Catholic Church forever. “Hitler will lose the war,” he exclaims, before going on to insist that something needs to be done quickly to prevent the Church’s treasures in Germany becoming the Allies’ spoils of war.
A few days later, on 27th June, that something happened. Nogara convinced Pius XII to outsource the Vatican bank under the name Institute for Works of Religion (IOR) – transforming the harmless asset management system of the Church into a network that branched into more than 70 banks within a few years. It was a brilliant move that made the Vatican bank virtually invisible as a financial institution, meaning large amounts of money could be moved across borders during the war. At the same time, Vatican speculators undermined the global economy, investing billions by purchasing blocks of shares. Using shell companies, they hoarded shares in the insurer Generali, defence group Finmeccanica, oil giant Shell, carmakers Alfa Romeo and General Motors, tech firm IBM and the pharmaceutical company Sereno – later one of the manufacturers of the contraceptive pill.
Why bother, you ask? In a word: camouflage. Because the Vatican bank no longer just looked after Church property, it had become a lucrative business model and the perfect tool to launder money for criminal gangs around the world. The first sin of ‘God’s bank’ involved truckloads of Nazi loot appearing at its headquarters in Rome…