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Vatican bankers quizzed over laundering

September 30, 2010

By Guy Dinmore in Rome

Published: September 30 2010

Rome magistrates leading an investigation into a suspected breach of money laundering regulations by the Vatican bank questioned its top two officials for several hours on Thursday for the first time since the probe was opened and €23m in Vatican funds were seized.

Leaving the judiciary complex in Rome after their meeting, Ettore Gotti Tedeschi, head of the Institute for Religious Works (IOR) as the Vatican bank is formally known, repeated to reporters the Vatican’s explanation that the events were the result of a “misunderstanding” which he intended to clarify.

Nello Rossi, the magistrate leading the probe, declined to comment after questioning Mr Gotti Tedeschi and Paolo Cipriani, IOR director-general, in the presence of their lawyer.Rome’s finance police revealed on September 21 that they had seized €23m ($31m) held by IOR in an account at Credito Artigiano, an Italian bank, after IOR tried to make two transfers to accounts held at two other banks.

Banking sources said the Vatican bank had repeatedly failed to provide information requested by Credito Artigiano and the bank of Italy on the beneficiaries and the reason for the transfers.

After the funds were seized the Vatican released a statement expressing its “perplexity and amazement”. It said the requested information “could have been clarified with great simplicity” and that IOR held the accounts to which the money was being transferred.

The issue is highly sensitive for the Vatican which, exactly a year ago, appointed Mr Gotti Tedeschi – a veteran banker and lecturer in ethics in finance – to continue the work of putting IOR in order following its entanglement in the fraudulent collapse of Banco Ambrosiano in the 1980s and the Enimont corruption trials involving payments to Italian government officials a decade later.

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