a productive relationship with APSA, and in particular I have had the pleasure of working with Mr. Giorgio Stoppa as well as with Mr. Mennini on questions related to your account with us. I canât wait to maintain and improve the relations between our two institutions, and I canât wait to develop effective working relations with the deputies during this transitional period for APSA ⦠I hope that my conversation with him during this transitional period will not be a cause of difficulty for you, Cardinal, or for APSA. I am preparing a note with APSA on the provision of banknotes in US dollars, and I would be happy to know to whom you would prefer that I address it at APSA.
In the next few months Menniniâs activities would continue to be monitored discreetly. He still had important posts with the APSA real estate agents in Europe, which led de Franssu, in a letter of January 22, 2014, to ask Cardinal Calcagno to quickly have Mennini removed from the various boards of the companies associated with APSA, âconsidering the risks to our reputation we believe that this matter has to be addressed with a certain sense of urgency.â 3
Sample Audits: 94 Million in Off-the-Books Accounts
The Commission continued to comb through the books of the administrative bodies of the Holy See. The international banking community and the institutional oversight bodies, starting with Moneyval (the Council of Europeâs Committee of Experts on Anti-Money Laundering Measures), had always viewed Vatican banking with a certain skepticism. In its first mutual evaluation report of the Holy See in July 2012, Moneyval had already identified various gaps in the financial statements. The Vatican had long resisted the anti-money-laundering regulations adopted in modern countries. The proponents of greater transparency at the Vatican tended to be punished rather than rewarded, like Monsignor Viganò, who was banished to Washington, and former IOR President Ettore Gotti Tedeschi, who was ousted from the bank on May 24, 2012 after being subjected to a smear campaign.
During the first year of Francisâs papacy, Vatican bookkeeping was found noncompliant with common modern and transparent accounting standards. When COSEA started to sift through the accounts, the situation the examiners found was even worse than they had expected. According to a document in my possession submitted to the cardinals in February 2014, âThere are significant amounts of money, properties and other assets that are not recorded in the annual financial reports of the Holy See.â 4 In other words, âthere is an unidentified amount of money in the bank accounts that is not recorded.â
This was a denunciation of a system that had been in place since the times of Marcinkus and the IOR scandals. During critical moments it was kept quiet. To prevent reforms, it came out again forcefully as soon as the crisis was over. Large sums of money were being held in bank accounts listed to nonexistent charitable foundations. Hidden assets were kept off the books. Securities were not included in the normal bookkeeping so that they could be used for obscure purposes. The international auditors had repeatedly expressed their alarm, reporting the existence of âslush funds,â enabled by a kind of double-entry bookkeeping practiced by some departments. But the Pope did not ignore the reports, and he requested further exploration and verification. The size and the extent of the problem becomes even more disturbing when we read the confidential internal documents:
An analysis of the four sample entities reveals an amount of at least 94 million that is not recorded in the annual financial statements of the Holy See as of December 31, 2012. With 43 million to the Congregation for Asian Churches, 37 to the Nunciatures, 13 to Propaganda Fide and 1 to the Congregation for Saints. 5 This is caused by the lack of preventive oversight whereby the various
In the next few months Menniniâs activities would continue to be monitored discreetly. He still had important posts with the APSA real estate agents in Europe, which led de Franssu, in a letter of January 22, 2014, to ask Cardinal Calcagno to quickly have Mennini removed from the various boards of the companies associated with APSA, âconsidering the risks to our reputation we believe that this matter has to be addressed with a certain sense of urgency.â 3
Sample Audits: 94 Million in Off-the-Books Accounts
The Commission continued to comb through the books of the administrative bodies of the Holy See. The international banking community and the institutional oversight bodies, starting with Moneyval (the Council of Europeâs Committee of Experts on Anti-Money Laundering Measures), had always viewed Vatican banking with a certain skepticism. In its first mutual evaluation report of the Holy See in July 2012, Moneyval had already identified various gaps in the financial statements. The Vatican had long resisted the anti-money-laundering regulations adopted in modern countries. The proponents of greater transparency at the Vatican tended to be punished rather than rewarded, like Monsignor Viganò, who was banished to Washington, and former IOR President Ettore Gotti Tedeschi, who was ousted from the bank on May 24, 2012 after being subjected to a smear campaign.
During the first year of Francisâs papacy, Vatican bookkeeping was found noncompliant with common modern and transparent accounting standards. When COSEA started to sift through the accounts, the situation the examiners found was even worse than they had expected. According to a document in my possession submitted to the cardinals in February 2014, âThere are significant amounts of money, properties and other assets that are not recorded in the annual financial reports of the Holy See.â 4 In other words, âthere is an unidentified amount of money in the bank accounts that is not recorded.â
This was a denunciation of a system that had been in place since the times of Marcinkus and the IOR scandals. During critical moments it was kept quiet. To prevent reforms, it came out again forcefully as soon as the crisis was over. Large sums of money were being held in bank accounts listed to nonexistent charitable foundations. Hidden assets were kept off the books. Securities were not included in the normal bookkeeping so that they could be used for obscure purposes. The international auditors had repeatedly expressed their alarm, reporting the existence of âslush funds,â enabled by a kind of double-entry bookkeeping practiced by some departments. But the Pope did not ignore the reports, and he requested further exploration and verification. The size and the extent of the problem becomes even more disturbing when we read the confidential internal documents:
An analysis of the four sample entities reveals an amount of at least 94 million that is not recorded in the annual financial statements of the Holy See as of December 31, 2012. With 43 million to the Congregation for Asian Churches, 37 to the Nunciatures, 13 to Propaganda Fide and 1 to the Congregation for Saints. 5 This is caused by the lack of preventive oversight whereby the various
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