Belfast Telegraph

Tuesday 16 September 2014

Vatican bank 'failed to act on money laundering'

The Vatican's scandal-struck bank has failed on seven counts to clean up its act and will not be allowed on a list of financially virtuous nations, EU inspectors indicated yesterday.



The report, by Moneyval, a department of the Council of Europe, means the institution will remain outside the "white list" of countries that abide by global norms on fighting money laundering, the financing of terrorism and tax evasion.



The failures by the bank, known as the Institute for Works of Religion (IOR), in the 16 key areas of financial transparency include: insufficient customer due diligence; insufficient compliance on the reporting of suspicious transactions; and insufficient supervision and monitoring.



Rome magistrates are investigating the bank regarding suspicious transactions that came to light in 2010. But the whiff of financial scandal about the bank, which is housed in the 15th-century Tower of Nicholas V overlooking Pope Benedict's apartment, has been present since 1982, when it was implicated in the fraudulent bankruptcy of Banco Ambrosiano.



The IOR's president, Italian Gotti Tedeschi, was ousted in a boardroom battle on 24 May. He said he was fired because he was too keen on improving transparency; the Vatican said he was an obstacle.



The Moneyval report "strongly recommended" that the bank be "independently supervised by a prudential supervisor".



The Vatican's Undersecretary of State, Monsignor Ettore Balestrero, said the report had noted some progress and that "both the praise and criticism" from the Moneyval committee on financial transparency were welcome. He added that the Vatican has always had "a clear determination to fight money laundering and terrorist financing".

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