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Under scrutiny, Vatican bank opens its doors
Institute’s shift a response to money-laundering inquiries
Question of the Day
VATICAN CITY — The Vatican bank, one of the most secretive institutions in the secrecy-obsessed Vatican, opened itself up to a little external scrutiny Thursday in a bid to show it is serious about fighting money-laundering and being more financially transparent.
During a nearly three-hour PowerPoint presentation to a few dozen journalists, the bank’s director, Paolo Cipriani, highlighted the peculiar nature of the Institute for Religious Works, the bank’s official name, and stressed its internal and external financial controls.
But more important, he sought to refute media allegations that the institution has been less than cooperative with requests for financial information from banks, including JPMorgan Chase & Co., and Italian authorities.
At one point, Mr. Cipriani displayed a letter from Italy’s financial police thanking him for his “timely and exhaustive response” in signaling a suspect transaction to them even before the Vatican’s new law banning money laundering went into effect last year.
And he described in detail the exhaustive checks carried out by the institute to ensure that the money that goes into and out of its accounts is clean.
The institute, known by its Italian acronym IOR, long has been the subject of rumor and scandal - earned in part because of its role two decades ago in one of the most spectacular banking collapses in Italy - and ongoing suspicions by Italian investigators that it hasn’t abided by rules against money-laundering norms.
Mr. Cipriani, in fact, remains under investigation by Rome prosecutors regarding a 2010 suspect transaction, though he hasn’t been charged. He has said the transaction merely involved moving money from one IOR treasury account to another and was not a client transfer, which requires more information to be provided.
In his first-ever news conference, Mr. Cipriani said his aim in coming before reporters was to “remove the veil and shadow of the past and do the utmost to respect the needs of the Holy See.”
However, TV cameras and recording devices were barred, and Mr. Cipriani didn’t take spontaneous questions from reporters.
Instead the Vatican spokesman selected some that had been submitted earlier and posed them to Mr. Cipriani, an affable, fast-talking Italian who nevertheless seemed a bit overwhelmed by the whole encounter.
The visit comes on the eve of a crucial decision by a Council of Europe committee on whether the Vatican has complied with a host of financing norms involving money laundering and terrorism.
A good compliance grade will enhance the Vatican’s chances of eventually getting on the so-called “white list” of countries that share financial information - a keen aim of both the pope and Mr. Cipriani, because the bank has to deal with financial institutions that insist that its books are clean.
The Institute for Religious Works was founded in 1942 by Pope Pius XII to manage assets destined for religious and charitable works.
Located in a squat stone tower just inside the Vatican City gates, it is not open to the public and isn’t even a bank per se but rather an institution that provides financial services, such as bank transfers and financial advice, for church entities in 150 countries.
It has about 35,000 accounts belonging to congregations, dioceses, Holy See offices, diplomats and Vatican officials. Mr. Cipriani said it has about $7.5 billion in assets.
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