Italy court releases seized Vatican money

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The Sydney Morning Herald

02 June 2011

AFP

An Italian court has released 23 million euros ($A.1 million) it had seized from the Vatican bank last year amid an inquiry into allegations of money-laundering.

The investigation centred on suspicious cash transfers in 2009 of 20 million euros to a branch of US bank JP Morgan in Germany and a further three million euros to the Italian Banca del Effacing.

Rome prosecutors said on Wednesday that their decision to release the money was based on the Vatican’s swift move to set up a new financial authority aimed at tackling allegations of money-laundering.

“The Holy See appreciates the release of the IOR funds,” Vatican spokesman Federico Lombardi said in an interview with Vatican radio, referring to the bank’s official name, the Institute for Religious Works (IOR).

“It confirms the correctness with which the IOR wants to operate and the seriousness of the Holy See’s commitment to stick to international standards for the prevention and fight against illegal financial activity,” he said.

New rules at the Holy See which came into effect on April 1 impose sentences of up to 12 years in prison for money-laundering and up to 15 years for “financing terrorism”.

Pope Benedict XVI created the new financial authority in December to address “the prevention and opposition to illegal financial activity.”

The move came despite insistence from the Vatican that the IOR was blameless.

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