Date
22 January 2017
The Vatican has been successful in cleaning up financial shenanigans but has been too slow to prosecute wrongdoers, according to a European financial watchdog. Photo: historycooperative.org
The Vatican has been successful in cleaning up financial shenanigans but has been too slow to prosecute wrongdoers, according to a European financial watchdog. Photo: historycooperative.org

Watchdog: Vatican should step up prosecution of financial crimes

The Vatican has made great strides in cleaning up its scandal-plagued bank and other financial institutions but it’s not doing enough to prosecute wrongdoers.

It should be more aggressive in dealing with people suspected of financial crimes such as money laundering and step up prosecutions and indictments, Reuters reports, citing a European finance watchdog.

Moneyval, the monitoring body of the Council of Europe, said the Vatican is excessively timid on the judicial front.

In a statement, Vatican officials said investigations are difficult and long because they often need cooperation from other countries.

However, they welcomed Moneyval’s recommendation for more “incisive” penal investigations that would lead to the punishment of crimes.

The Strasbourg-based watchdog evaluates how a country’s financial legislation and practices comply with international standards on combating money laundering and other financial crimes.

Pope Francis has made cleaning up Vatican finances a priority and Holy See staff worked with the Moneyval evaluators.

The detailed 150-page report, Moneyval’s third evaluation of the tiny sovereign city state since 2012, said many past deficiencies had been addressed.

“There still remains, however, a continued lack of indictments for money laundering or for related serious proceeds-generating offences in the three years since (the 2012 report). This situation needs to be improved,” the report said.

It said that while 29 money laundering investigations had been started and over 11 million euros (US$12.13 million) frozen in Vatican accounts, “there are no real results emerging by way of serious prosecutions in any of the outstanding enquiries”.

The report appeared to be referring to at least two major pending cases of suspected financial crimes, such as embezzlement and money laundering, in the past year.

Ten months ago, an investigation was opened after an internal report said a department of the Holy See which oversees real estate and investments was used in the past for possible money laundering, insider trading and market manipulation. 

A year ago, the Vatican’s top prosecutor froze 16 million euros in bank accounts owned by two former Vatican bank managers and a lawyer as part of an investigation into the sale of Vatican-owned real estate.

There have been no indictments in either case, even though they reached the highest levels of the Vatican’s financial structure.

By comparison, the Vatican’s judiciary, known as the Office of the Promoter of Justice, moved quickly to indict five people, including two journalists, currently on trial over a leaks scandal.

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