Vatican Praised for Efforts to Combat Money-Laundering
European evaluators urged Vatican prosecutors on Tuesday to move ahead and bring charges in some of the 25 money-laundering investigations they have opened over the past few years as part of beefed-up measures to prevent illicit activity at the Vatican’s scandal-marred bank.
The Council of Europe’s Moneyval committee issued the appeal in a periodic progress report on the Holy See’s compliance with international norms to fight money-laundering and terror financing.
Moneyval praised the Holy See for addressing most of the outstanding legal loopholes flagged in the committee’s 2012 evaluation. But it said it remained unclear how the laws were being implemented, since prosecutors have yet to hand down a single indictment, despite having 25 money-laundering investigations open.
“All in all, the basically sound legal structure that has been put in place to prevent and prosecute money-laundering now needs to deliver some real results on the prosecutorial side,” the report concluded.
It noted that a “major” fraudulent bankruptcy case is expected to be prosecuted shortly by the Vatican — an apparent reference to an Italian businessman involved in building and construction contracts in the Vatican.
In response, the Vatican said Tuesday the cases were complicated and in many instances involved foreign citizens and crimes committed in other countries, requiring an international exchange of information that takes time.
The Vatican submitted to the Moneyval evaluation process after it signed onto the 2009 EU Monetary Convention and in a bid to shed its image as a financially shady tax haven whose bank has long been embroiled in scandal.
In recent years, the Vatican has written laws criminalizing money-laundering, entered into financial information-sharing agreements with dozens of countries, closed nearly 5,000 accounts at its bank and made sure it knows the background of all clients.
Moneyval in 2012 gave the Vatican a passing grade in its first evaluation, and has given it increasingly positive marks in follow-up reports. On Tuesday, it said that since the last review in 2013, some 25 money-laundering investigations had been launched, 13 in 2015 alone.
The spike this year was the result of an unusually high 329 suspicious transaction reports received by the Vatican watchdog, the Financial Information Authority. The spike is believed to be related to the Vatican’s toughened line on suspected tax evasion among bank clients.
While praising Vatican prosecutors for freezing significant assets in their investigations — currently 11.2 million euros has been sequestered — Moneyval questioned why no one had yet been indicted.
The Vatican spokesman, the Rev. Federico Lombardi, said the Holy See welcomed Moneyval’s recommendation to reinforce its tribunals and gendarmerie to better investigate and punish financial crimes.