VATICAN CITY (CNS) — The Vatican’s financial watchdog agency has beefed up its investigations with increased outreach to foreign authorities in a continued effort to prevent suspected money laundering and the financing of terrorism.
Given the growing number of agreements it has made to share information with other foreign financial intelligence authorities and the “increasing complexity of potential money laundering schemes,” the Vatican Financial Intelligence Authority (AIF) made more than 700 requests to foreign authorities in 2016 — up from about 200 requests in 2015 and just 20 requests in 2014. The requests can be for documents, data and information deemed relevant for preventing or countering criminal activity.
“The main driver of the increase of the figures relating to the international cooperation and exchange of information is, on the one hand, the preventive and proactive approach taken by AIF at the international level and, on the other hand, the increase of counterparts, and lastly the sophisticated feature of cases … involving several subjects and foreign jurisdictions,” said the agency in its annual report for 2016.
Rene Brulhart, president of the Financial Intelligence Authority, and Tommaso Di Ruzza, its director, presented the report at a Vatican news conference May 16.
The 28-page paper noted a drop in the number of reports of suspicious activity AIF received: 207 reports in 2016 compared to 544 reports in 2015. Vatican law requires the reporting of suspected funds or activities to the AIF.
The agency said the number of reports was still higher than those received before 2015, which indicates improved and increasingly effective “implementation of reporting requirements” by the entities the agency oversees. The authority monitors financial operations at the Vatican bank, formally known as the Institute for the Works of Religion (IOR), to ensure they meet international norms against money laundering and the financing of terrorism.
A handful of cases were then forwarded on to the office of the promoter of justice at the Vatican City State’s tribunal after the agency determined there were reasonable grounds to suspect money laundering or the financing of terrorism.
The finance agency did not specify the number of suspicious cases it had looked into, listing only the number of reports — 22 — it made, which included updates and added information about ongoing cases, Di Ruzza said.
Early this year, the Vatican’s chief prosecutor, Gian Piero Milano, said just two cases led to indictments and three cases were dropped in 2016. He said that from 2012 through 2016, the Vatican Financial Intelligence Authority reported 23 cases of suspicious transactions to the court and 17 of those cases still were under investigation.
European experts on preventing financial crimes have said that the Vatican’s lack of indictments and prosecutions for financial crimes needed improvement.
Moneyval — the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism — released a report in December 2015 praising the Vatican for significant steps in establishing laws and procedures in line with international protocols, but called for “real results” in cracking down on infractions.
The Financial Intelligence Authority said in its report that it blocked four transactions totaling more than 2.1 million euros (about $2.3 million) and froze one account of more than 1.5 million euros in 2016; however, it did not specify the nature or result of the preventative interventions, which may have been temporary.
It was the fifth public report since the agency was established by Pope Benedict XVI in 2010 to monitor Vatican financial operations and ensure they met international norms against money laundering and the financing of terrorism.
In 2013, Pope Francis restructured the agency and revised its statutes to expand its role to include “preventive” vigilance, which involves ensuring the proper organization and trustworthiness of all Vatican financial operations. However, at the end of 2015, the agency no longer had oversight control of the Administration of the Patrimony of the Holy See, commonly referred by its Italian acronym APSA, just as the authority was calling for investigating allegations APSA accounts had been used for money laundering, insider trading and market manipulation.
After reforms instituted by Pope Francis, APSA’s financial activities were defined as being those of a procurement agency — the assets it manages are owned by the Holy See and are used just to fund activities of the Roman Curia — and not a “professional” finance institution that the Financial Intelligence Authority would oversee.
Pope Francis’ creation of the Council and Secretariat for the Economy in 2014 meant APSA would be supervised by that entity, which is in charge of supervising all administrative and financial activities at the Vatican, and implementing the norms made by the Council for the Economy. Its own auditor’s office investigates signs of corruption, fraud and “anomalous activity” or irregularities concerning financial activities, budgeting, bookkeeping and the offering of outside contracts or services.
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