Vatican Finances Aboveboard, Affirms Aide

Laments Misunderstanding That Could Have Been Easily Clarified

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VATICAN CITY, SEPT. 23, 2010 ( Current media attention on the Vatican’s Institute for the Works of Religion is rooted in a misunderstanding that “could have been clarified with great simplicity,” according to a Vatican spokesman.

Jesuit Father Federico Lombardi, director of the Vatican press office, affirmed this in a statement today published by the Financial Times.

The issue was first reported Tuesday, when the Vatican Secretariat of State announced its perplexity that Italian finance authorities seized some €23 million ($30 million) of Vatican funds.

The procurator’s office in Rome also announced an investigation of Ettore Gotti Tedeschi, the president of the Vatican institute, and Paolo Cipriani, the director-general.

In today’s statement, Father Lombardi affirmed that the international nature of the Institute for the Works of Religion [IOR] and Gotti Tedeschi’s well-known status in the financial world moved him to “seek to avoid the spread of inaccurate information and to ensure that no damage is caused to the institute or the good name of its managers.”

The Vatican spokesman went on to clarify that the IOR is “not a bank in the normal definition of the term.”

Rather, he said, “It is an institute that administers the assets of Catholic institutions, who aim to further a religious and charitable apostolate at an international level. The IOR is located within the territory of Vatican City State, beyond the jurisdiction and surveillance of various national banks.”

Father Lombardi noted efforts to include the Holy See on the Organization for Economic Co-operation and Development’s [OECD] “white list,” but he explained that the “particular status [of the IOR] means that its position in the system and the regulations of international finance require a series of agreements to establish the procedures necessary.”

“[T]his is especially true in light of the new norms laid down by the European Union to combat terrorism and money laundering, he added.


In this context, Father Lombardi affirmed that the president, Gotti Tedeschi, from the “day of his appointment” and “in accordance with the mandate he received from the highest Vatican authorities” has been working “with great commitment to ensure the absolute transparency of the IOR’s activities, and its compliance for the norms and procedures which will allow the Holy See to be included in the white list.”

Mentioning the “intense and fruitful contacts” that are ongoing with the Bank of Italy, the European Union, the OECD and the the Financial Action Task Force, he said it is “for this reason that the Vatican Secretariat of State expressed its perplexity and amazement at this investigation by the Procurator’s Office in Rome, which has come at a time in which this commitment is being clearly shown and these contacts are being made in order to reach lasting solutions as soon as possible.”

Father Lombardi contended that the “nature and aims of the transactions under investigation could have been clarified with great simplicity.” He said they were cash transactions the beneficiary of which is the institute itself, on accounts it holds at other credit institutions. 

“The current problem was caused by a misunderstanding — now being examined — between the IOR and the bank which received the transfer order,” he said. 

Thus, the spokesman affirmed that the Holy See reiterates “complete confidence in the managers of the IOR, and its desire for complete transparency in the financial operations the institute undertakes, in accordance with the procedures and norms required today to ensure the security and transparency of transactions in the field of international finance.”

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