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Red flags in the Vatican financial trial

By Phil Lawler ( bio - articles - email ) | May 12, 2022

The Vatican’s financial “trial of the century” is limping toward a conclusion that, when it finally comes, is likely to satisfy no one. With each new court session it seems less likely that the Vatican tribunal will reach a clear conclusion. Meanwhile each new revelation confirms suspicions that Vatican officials should not be trusted with major financial investments.

Last week’s appearance before a Vatican tribunal of Cardinal Angelo Becciu, the most prominent defendant, could have provided the dramatic highlight of this judicial marathon. But the complexity of the case, the uncertainties surrounding his defense, and the unfamiliar structure of the Vatican judicial system all make it difficult to follow the drama. For readers willing to take a deep dive into the arcana of the case, I recommend the coverage offered by The Pillar, whose reporters have carefully followed both the legal maneuvering in this case and the equally labyrinthine financial shenanigans that prompted the prosecution.

For other readers—for those who lack the patience to follow the intricacies of the case, and/or are willing to wait until the Pillar journalists write the definitive book on the trial—let me offer a few observations on the latest developments:

  1. Cardinal Becciu’s defense is full of holes. When Cardinal George Pell referred to the Becciu testimony as “somewhat incomplete,” he was being courteous. Reading Cardinal Becciu’s courtroom account of his financial stewardship, anyone accustomed to Anglo-American jurisprudence would expect a skillful prosecutor to rip into it, exposing the gaps and anomalies and outright contradictions, providing the drama court-watchers crave. But a Vatican tribunal does not function by the same adversarial system; the cardinal was not subject to hostile cross-examination.
  2. If the Becciu account is accurate—a big “if”—Pope Francis authorized the payment of ransom to kidnappers. Cardinal Becciu said that he made large payments to a shadowy “security consultant” to expedite the release of a nun who was held captive in Mali. (Italian security officials claim that they arranged for the nun’s release, giving no credit to any Vatican involvement.) An AP report accurately observed that this testimony “could pose serious security implications for the Vatican and the Catholic Church.” If kidnappers come to believe that the Church will pay ransom, the kidnapping of clerics and religious becomes a more attractive proposition.
  3. Earlier testimony suggested that Pope Francis had pushed for completion of a controversial London real-estate transaction, despite evidence of criminal activity. Several witnesses have now testified that they were told Pope Francis acknowledged the possibility of fraud, but—prompted by other ranking Vatican officials—chose to go ahead with the deal, in the belief that a criminal trial would be more damaging to the Vatican. Well (again, assuming that these witnesses were testifying accurately) how has that worked out? When will Church leaders finally learn the painful lesson that the cover-up only aggravates the initial offense?
  4. The mysterious Becciu transfers to Australia loom larger than ever. In his appearance last week, the cardinal triumphantly announced that the million-dollar transfers, which had never been explained, were for a top-level internet domain for the Holy See, and were approved by none other than Cardinal Pell himself. Not so fast. Cardinal Pell responded that he had indeed approved one large payment for that purpose. But the payment he authorized was made by the Pontifical Council for Social Communications, not the Secretariat of State, where Cardinal Becciu was working. It makes perfect sense that the Pontifical Council for Social Communications would be handling the Vatican’s internet operations. Why would the Secretariat of State take over the payments? And the payment authorized by Pell represented only a fraction of the total transferred to Australia. Now that the Pope has lifted the pontifical seal, why is there any secrecy remaining about all these transfers? Is it conceivable that millions of dollars changed hands without any records, any receipts, any log of wire transfers? The crucial questions remain unanswered.

Even on the most benign reading, the story that Cardinal Becciu told the Vatican tribunal is a tale of unsupervised, even reckless investing, without even a hint of proper accountability. No wonder Cardinal Becciu fought so ferociously against Cardinal Pell’s plan for a thorough audit. Reacting to his old rival’s testimony, Pell observed that Becciu “did not explain his role in the sacking of the auditors PriceWaterhouseCoopers, and in the resignation of the Auditor, Libero Milone: both mandates to investigate Secretariat of State records.”

This week the European banking watchdog, Moneyval, gave the Vatican solid grades for closing down opportunities for money-laundering and other financial mischief. But the generally favorable Moneyval report included one strong caution: “a red flag for potential abuse of the internal system by mid-level and senior figures (insiders) for personal or other benefits.” The current financial trial is not a matter of potential abuse. It is a case in which, by all credible accounts, one of the most powerful figures at the Vatican was able to shut down all efforts to audit the transactions that he engineered. Then a few years later that same official stands trial for financial misconduct, and answers the charges by saying that all his actions were authorized.

The Moneyval report is right; the system’s built-in deference to senior prelates is a red flag. And if this trial winds down without a clear finding of guilt somewhere, that red flag will still be waving.

Phil Lawler has been a Catholic journalist for more than 30 years. He has edited several Catholic magazines and written eight books. Founder of Catholic World News, he is the news director and lead analyst at CatholicCulture.org. See full bio.

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  • Posted by: feedback - May. 15, 2022 7:31 AM ET USA

    These ongoing revelations point to network of corrupt compromised individuals at the top levels of Church hierarchy. I'm afraid that the rumors of selling out Catholics in China by the Vatican starts to look very plausible. There is no doubt that the communist regime would do it in a heartbeat if given the opportunity, and none other but McCarrick was the designated negotiator of the "top-secret" agreement. The honorable thing to do would be a slew of resignations ASAP for the good of the Church

  • Posted by: ewaughok - May. 13, 2022 6:01 PM ET USA

    Expect this trial to end with no convictions, no reforms, no legal conclusions. Becciu (and Bergoglio) will wriggle free … only if Italian or UK authorities bring charges will the corruption be fully revealed …