Holy See reduces fraud risk

Vatican watchdog welcomes improvements, but some international agenceis point to slow judicial follow-ups
Holy See reduces fraud risk

A file image of a member of the Pontifical Swiss Guard at the Vatican. (Pixabay.com photo)

The Holy See has greatly reduced the risk of misconduct taking place in relation to its business dealings, according to the Vatican's Financial Information Authority (FIA).

The 2018 annual report was publicly released May 21 by the authority's president, Rene Brulhart, and Tommaso Di Ruzza, who is the director.

The report included a warning that every time money changes hands, there is a risk of improper dealings.

Brulhart said that Vatican City State's independent status, as the headquarters of the Catholic Church for missions and religious orders around the world, required tailor-made measures to prevent illicit financial activities.

And Di Ruzza said that while the Holy See had "fewer worries" on this front than the governments of most nations, there was still a need for preventive strategies.

"Given the peculiarity of the Holy See, there is a level of caution, especially on a moral scale, that must be maintained," he added.

In 2018, the FIA received 56 reports of suspicious financial activities compared to 150 in 2017 and 207 in 2016.

Eleven of the 56 reports were forwarded to Vatican judicial officials for further investigation and the possible laying of criminal charges.

An assessed "low to medium" risk of money laundering was attributed to a large number of procurement and building contracts signed with entities outside the Vatican.

The risk of becoming embroiled in the financing of terrorism has been categorized as low.

International agencies complimented the Vatican for its new rules and structures to prevent money laundering and terrorism financing, but some complained about the slow pace of follow up by the Vatican's police and courts.

In December 2018, for the first time, a Vatican court recorded a conviction for money laundering following an investigation based on an FIA report.

Angelo Proietti, an Italian contractor who is appealing his conviction, was sentenced to two-and-a-half years imprisonment for using a Vatican Bank account for money laundering.

FIA also is increasingly cooperating with similar agencies in dozens of countries to investigate financial impropriety, the report said.

Without mentioning specifics, it referred to a case in which the owners of an "alleged non-profit organization" presented themselves as local affiliates of a Vatican-related institution in order to collect donations in its name.

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Thanks to information shared with the country, several people were arrested on charges of criminal conspiracy. Money, valuables and firearms were seized.

The case mentioned in the report corresponds to the arrest in Spain in February 2018 of three Spaniards and a Colombian who were allegedly operating a fake branch of the Vatican Bank.

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