Pearls and Irritations

Sensational news stories about Vatican finances are two-a-penny. But for the first time Australia features in a scandal with claims that since 2014 €1.4 billion (A$2.3 billion) of Vatican money ended-up in the Great South Land.

An old chestnut in the Australian media is ‘the enormous wealth of the Vatican.’ Many mistakenly think the Vatican owns the worldwide Catholic church, lock, stock and barrel, or that it is somehow a bottomless pit of Mafia money-laundering.

Another regular complaint is: ‘Why doesn’t it sell its art treasures to feed the poor?’ Abstracting from the difficulty of moving the Sistine ceiling, or the walls on which the Stanze of Raphael are painted, perhaps these questioners would prefer that a large chunk of the artistic heritage of the West be sold off and locked away in private collections in Texas, or other undesirable place?

So here we go again with another Vatican financial ‘scandal’. Following an October 2020 question from Liberal Senator Concetta Fierravanti-Wells, the government agency responsible for tracing ‘dirty’ money, AUSTRAC, told Senate Estimates that A$2.3 billion had been transferred in some 47,000 separate payments from the Vatican since 2014 ‘to a person or persons in Australia.’ AUSTRAC also ‘provided information to the Australian Federal Police and Victoria Police.’

The AFP have since ‘reviewed the relevant information’ and have passed ‘aspects of this matter to the Victorian Independent Broad-based Anti-Corruption Commission.’ At the time of writing AUSTRAC are still talking to the Vatican, trying to sort out who sent the mysterious billions and why.

First, where did this story originate? It began with a report in early-October 2020 in the usually reliable Milan-based newspaper, Corriere della Sera, which claimed that large amounts of money, including a transfer of €700,000, were sent from the Vatican to an account in Australia ‘possibly in connection with [Cardinal] Pell’s trial.’

While no evidence was offered, the name of Cardinal Giovanni Becciu, an enemy of Pell when he ran the Holy See’s Secretariat for the Economy, was mentioned by Corriere as the key suspect in the transfers. Becciu was a leader among those in Rome who opposed Pell’s entirely justifiable attempts to introduce accountability and transparency into the convoluted and arcane finances of the Vatican when he ran the Holy See’s Economy Secretariat between 2014 and his return to Melbourne for his 2018 trial. An incurable financial wheeler and dealer who was sacked by Pope Francis in September 2020, Becciu was also a key figure in dragging the Vatican into various financial deals, including a convoluted transaction surrounding an over-priced property in London’s Knightsbridge (Pearls and Irritations, 13 October 2020 www.johnmenadue.com/paul-collins-the-beginning-of-the-end/).

By late-December 2020 Corriere’s €700,000 had become, according to AUSTRAC, A$2.3 billion! Despite all the myths about Vatican wealth, this is a gobsmacking amount for an outfit with a loss-making annual budget (in 2019) of €318 million and an income of €307 million. In December last year Pell – and he’d know – told Reuters that the Vatican was slowly ‘going broke.’

Nowadays we have good knowledge of the Vatican’s finances thanks to the Council of Europe’s experts on anti-money laundering and financing of terrorism, Moneyval. In 2012, at the invitation of Pope Benedict XVI, Moneyval investigated and issued a detailed and informative report on the Vatican’s finances focused on the Holy See’s two financial institutions: the Institute for Works of Religion (IOR), i.e. the ‘Vatican Bank’, and the Administration of the Patrimony of the Holy See (APSA).

The IOR is a small bank with about €6.3 billion under management; for comparison the CBA has A$976.5 billion. The IOR acts as a bank largely for deposits from dioceses, parishes, religious orders, bishops, and a tiny and restricted number of laypeople. In total it has about 33,500 accounts, 47 of them based in Oceania, presumably most in Australia.

APSA administers the property and manages the funds and budget of the Vatican, including paying the salaries of the 4,800 people who work there. It has about €685 million under management and invests in financial markets and real estate in France, Switzerland and the UK. APSA had nothing to do with Becciu’s Knightsbridge debacle.

So, if the Vatican shifted some A$2.3 billion to Australia, where did the money come from? It just doesn’t have that kind of cash. APSA sent some €800,000 to Australia between 2014 and 2020, mostly for salaries and expenses for the Vatican Nunciature (embassy) in Red Hill, Canberra. In the same period the IOR sent money to its clients in Australia, but it was nothing remotely like the amounts mentioned by AUSTRAC.

The Australian bishops are just as bemused as the Vatican. President of the Bishops’ Conference, Brisbane Archbishop Mark Coleridge, told The Australian: ‘What is certain…is that the Australian bishops didn’t know about these transfers until the AUSTRAC disclosure…and we were astonished at the scale of the transfers.’ He also said that the funds were not used for settlements with sexual abuse victims, nor to fund legal costs for Cardinal Pell.

It is highly unlikely that the A$2.3 billion came from the Vatican. So, what’s happening? According to the London-based weekly The Tablet’s man in Rome, Christopher Lamb, its likely ‘the transfers were made through “cipher accounts” of individuals using the Vatican’s name to move money around.’ What AUSTRAC needs to tell us is who controls these accounts and where the money is going.

The one person to emerge from all this with credit is George Pell. His mantra could be ‘Don’t say I didn’t warn you’ after he tried very hard to get accountability and transparency into Vatican finances. This saga will enhance Pell’s standing in Rome, while Giovanni Becciu awaits his fate out in the cold.

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