Vat­i­can bank mired in laun­der­ing scan­dal

The Pak Banker - - Company& -

VAT­I­CAN CITY: This is no or­di­nary bank: The ATMs are in Latin. Priests use a pri­vate en­trance. A life-size por­trait of Pope Bene­dict XVI hangs on the wall.

Nev­er­the­less, the In­sti­tute for Re­li­gious Works is a bank, and it's un­der harsh new scru­tiny in a case in­volv­ing mon­ey­laun­der­ing al­le­ga­tions that led po­lice to seize euro23 mil­lion ($30 mil­lion) in Vat­i­can as­sets in Septem­ber. Crit­ics say the case shows that the "Vat­i­can Bank" has never shed its pen­chant for se­crecy and scan­dal.

The Vat­i­can calls the seizure of as­sets a "mis­un­der­stand­ing" and ex­presses op­ti­mism it will be quickly cleared up. But court doc­u­ments show that pros­e­cu­tors say the Vat­i­can Bank de­lib­er­ately flouted an­ti­laun­der­ing laws "with the aim of hid­ing the own­er­ship, des­ti­na­tion and ori­gin of the cap­i­tal." The doc­u­ments also re­veal in­ves­ti­ga­tors' sus­pi­cions that clergy may have acted as fronts for cor­rupt busi­ness­men and Mafia.

The doc­u­ments pin­point two trans­ac­tions that have not been re­ported: one in 2009 in­volv­ing the use of a false name, and an­other in 2010 in which the Vat­i­can Bank with­drew euro650,000 ($860 mil­lion) from an Ital­ian bank ac­count but ig­nored bank re­quests to dis­close where the money was headed.

The new al­le­ga­tions of fi­nan­cial im­pro­pri­ety could not come at a worse time for the Vat­i­can, al­ready hit by rev­e­la­tions that it shel­tered pe­dophile priests. The cor­rup­tion probe has given new hope to Holo­caust sur­vivors who tried un­suc­cess­fully to sue in the United States, al­leg­ing that Nazi loot was stored in the Vat­i­can Bank. Yet the scan­dal is hardly the first for the cen­turies-old bank. In 1986, a Vat­i­can fi­nan­cial ad­viser died af­ter drink­ing cyanide-laced cof­fee in prison. An­other was found dan­gling from a rope un­der London's Black­fri­ars Bridge in 1982, his pock­ets stuffed with money and stones. The in­ci­dents black­ened the bank's rep­u­ta­tion, raised sus­pi­cions of ties with the Mafia, and cost the Vat­i­can hun­dreds of mil­lions of dol­lars in le­gal clashes with Ital­ian au­thor­i­ties.

On Sept. 21, fi­nan­cial po­lice seized as­sets from a Vat­i­can Bank ac­count at the Rome branch of Cred­ito Ar­ti­giano SpA. In­ves­ti­ga­tors said the Vat­i­can had failed to fur­nish in­for­ma­tion on the ori­gin or des­ti­na­tion of the funds as re­quired by Ital­ian law. The bulk of the money, euro20 mil­lion ($26 mil­lion), was des­tined for JP Mor­gan in Frank­furt, with the re­main­der go­ing to Banca del Fu­cino. -PB News

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