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| Upheaval Lifts Vatican Bank’s Veil of Secrecy By Guy Dinmore The Peninsula October 18, 2009 http://www.thepeninsulaqatar.com/Display_news.asp?section=Business_News&subsection=market+news&month=October2009&file=Business_News20091018225147.xml Originally founded in 1887 and housed within a medieval bastion at the heart of the papal state, the closely guarded secrecy of the Istituto per le Opere di Religione, the Vatican’s bank, is slowly being prised open, although the surprise resignation of its director has only added to the mysteries surrounding the Church’s finances. The departure of Angelo Caloia, after 20 years at the helm but 18 months before his term was to expire, was announced briefly and without explanation by the Vatican last month in a sweeping change of the bank’s management. Cardinal Tarcisio Bertone, the Vatican’s number two, thanked him for his “generous services” and announced Ettore Gotti Tedeschi, a Milan banker and professor of ethical finance, as his successor. The bank, known as IOR, does not publish accounts but is believed by bankers to hold assets of some $5bn (ˆ3.4bn, ?3.1bn). It is overseen by five key cardinals, has no shareholders and its profits are used for charitable purposes. Mr Caloia said a year ago the bank had not invested in derivatives and survived the global crisis through prudent management. IOR has for decades rarely been free of controversy. It was thrust uncomfortably into the spotlight in 1982 with the fraudulent collapse of Banco Ambrosiano - in which it was the largest shareholder - and the death while on the run from the law of Roberto Calvi, the head of the failed bank who was found hanging from Blackfriars Bridge in London, a presumed victim of the Mafia. The Vatican invoked a treaty that gave it immunity from Italian investigations. While denying all wrongdoing connected to Banco Ambrosiano, it agreed in 1984 to pay $244m to creditors of the collapsed bank in exchange for the dropping of further claims against the Vatican. In this context Caloia was appointed in 1989 as the new broom to bring IOR into the modern world, for instance employing outside auditors for the first time. But still IOR did not entirely escape critical attention. It emerged during the so-called Enimont trial in the early 1990s that IOR accounts had been a conduit for bribes paid to Italian government officials. IOR co-operated with the investigation and was not accused of any wrongdoing. The bank’s activities were again the subject of public scrutiny several months ago following the publication of Vaticano S.p.A. (Vatican Inc), a best-selling book by Gianluigi Nuzzi, a journalist who says he was leaked many internal Vatican documents by a disgruntled priest. Nuzzi’s book claims that political bribes passed through IOR accounts in the Enimont case and that funds donated for charitable purposes were misappropriated by the bank’s administrators. The documents also purport to show how IOR, despite promises of full co-operation with Italian investigators of the Enimont scandal, may have kept back information. The priestly whistleblower, an IOR employee, is said by Nuzzi to have written to the bank’s chief lawyer of the need to avoid “leading [the investigators] into temptation”. Neither the Vatican nor IOR have commented on the book’s allegations. The Vatican reiterated that it had nothing to say on the matter. One commentator, Philip Willan, author of The Last Supper, a book about Banco Ambrosiano’s collapse, said: “Nuzzi’s book was embarrassing for Caloia.” Some Vatican insiders have also suggested that Pope Benedict and Cardinal Bertone sought Mr Caloia’s resignation as part of their purging of the Vatican administration of the “old guard” linked to the late John Paul II. The shadow of the G20 and its assault on tax havens and money-laundering is also said by bankers in Italy to hang over the world’s smallest state, and that one of the tasks facing Gotti Tedeschi, IOR’s new director, will be to bring the Vatican in line with modern practice. Gotti Tedeschi is reported to have advised the Pope in publishing his encyclical, Charity in Truth, which condemned the “grave deviations and failures” of capitalism. A 64-year-old father of five, Gotti Tedeschi is the head of the Italian division of Bank Santander and an adviser to Giulio Tremonti, Italy’s finance minister. He did not respond to requests for comment. |
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