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Rotten rich Vatican

Published:Sunday | December 7, 2014 | 12:00 AM
Pope Francis (right) embraces his predecessor, Pope Emeritus Benedict XVI, whose resignation is now being linked to financial scandals.
Pope Francis leaves after a wedding ceremony in St Peter's Basilica at the Vatican.

Pope's financial czar says Holy See has millions of euros extra

VATICAN CITY (AP):The Vatican's economy czar says the Holy See's finances are in better shape than he thought, revealing that hundreds of millions of euros were kept off the balance sheet and that reforms are forging ahead to make the Vatican "boringly successful".

In a frank essay published last Friday in Britain's The Catholic Herald, Cardinal George Pell outlined his vision for a Vatican that follows international accounting standards, is transparent and audited externally, and uses its proceeds to help the poor.

Pope Francis was elected in 2013 on a mandate to get the Vatican's finances in order after years of scandal at its bank and waste in its administration. Pell was among the most vocal in calling for reform, and was named by Francis to head the new Secretariat for the Economy to oversee the process.


In the essay, Pell disparaged the Vatican's past practices of financial secrecy, defending fiefdoms and dragging its feet in implementing international anti-money laundering norms.

He resurrected two of the most recent scandals — the "sacking" of the Vatican bank president and the leaks of documents by the papal butler — which he said had "severely" damaged the Holy See's reputation.

In saying they were a "heavy cross" for Emeritus Pope Benedict XVI to bear, Pell suggested that Benedict's resignation was indeed linked to the scandals. The reforms, however, are going ahead to make the Vatican "boringly successful", Pell said.

He said his team had discovered that the financial situation was "much healthier than it seemed, because some hundreds of millions of euros were tucked away in particular sectional accounts and did not appear on the balance sheet".

"It is important to point out that the Vatican is not broke ... the Holy See is paying its way, while possessing substantial assets and investments," said Pell.

Pell didn't say that the euros were unknown to Vatican authorities, just that they didn't feature into the balance sheet.

Nor did Pell suggest any wrongdoing but said Vatican departments had long had "an almost free hand" with their finances and followed "long-established patterns" in managing their affairs.

"Very few were tempted to tell the outside world what was happening, except when they needed extra help," he said, singling out the once-powerful Secretariat of State as one department that had especially jealously guarded its independence.

"It was impossible for anyone to know accurately what was going on overall."

Pell is an outsider from the English-speaking world transferred by Pope Francis from Sydney to Rome to oversee the Vatican's often muddled finances after decades of control by Italians.

Last month, his office sent a letter to all Vatican departments about changes in economic ethics and accountability.

As of January 1, 2015 each department will have to enact "sound and efficient financial management policies" and prepare financial information and reports that meet international accounting standards.

"Each department's financial statements will be reviewed by a major international auditing firm," the letter said.

Since the pope's election in March, 2013, the Vatican has enacted major reforms to adhere to international financial standards and prevent money laundering. It has closed many suspicious accounts at its scandal-rocked bank.

In his article, Pell said the reforms were "well under way and already past the point where the Vatican could return to the 'bad old days'."