The Chicago Tribune
11:40 a.m. CDT, May 25, 2012
Philip Pullella Reuters
VATICAN CITY (Reuters) – Pope Benedict’s butler was arrested on Friday in connection with an investigation into leaks of confidential documents, some alleging cronyism and corruption in Vatican contracts, a senior Vatican source said.
The scandal, which has come to be known as “Vatileaks”, involves the leaking of a string of documents to Italian media in January and February, including personal letters to the pope.
Some of the documents involved allegations of corruption, mismanagement and cronyism in the awarding of contracts for work in the Vatican and internal disagreement on the management of the Vatican bank.
The president of the Vatican bank, Ettore Gotti Tedeschi, was ousted by its board on Thursday.
Vatican spokesmen said earlier on Friday that a person in possession of confidential documents had been arrested but that they could not disclose his position or identity until they were given permission from Vatican investigators.
The Vatican source confirmed reports by Italian media that the person arrested was the butler.
“It’s all very sad,” another senior Vatican source said, commenting on an episode that is the latest in a string of embarrassments for the Vatican.
The pope’s butler serves in the apartments of the Apostolic Palace, serving at the papal tables, handing rosaries to visiting dignitaries and riding in the first seat of the popemobile at papal audiences.
As an intimate member of the papal household, he is privy to the goings on in the most reserved and private rooms in the Vatican.
Italian media said investigators had found documents in his apartment.
The pope, who has been shocked and saddened by the leaks, ordered several investigations, including one headed by Vatican police and another by a commission of cardinals.
The leaked documents included letters by an archbishop who was transferred to Washington after he blew the whistle on what he saw as a web of corruption and cronyism, a memo which put a number of cardinals in a bad light, and documents alleging internal conflicts about the Vatican Bank.
In January, an Italian television investigation broadcast private letters to Secretary of State Cardinal Tarcisio Bertone and the pope from Archbishop Carlo Maria Vigano, the former deputy governor of Vatican City and currently the Holy See’s ambassador in Washington.
The letters showed that Vigano was transferred after he exposed what he argued was a web of corruption, nepotism and cronyism linked to the awarding of contracts to Italian contractors at inflated prices.
In one letter, Vigano wrote of a smear campaign against him by other Vatican officials who were upset that he had taken drastic steps to clean up the purchasing procedures. He begged to stay in the job to finish what he had started.
Bertone responded by removing Vigano from his position three years before the end of his tenure and sending him to the United States, despite his strong resistance.
(Editing by Alison Williams)
Vatican bank chief ousted in no-confidence vote
The Kansas City Star
24 May 2012
By NICOLE WINFIELD
In this Dec. 21, 2011, file photo, Ettore Gotti Tedeschi, head of the Vatican bank I.O.R., leaves after greeting Pope Benedict XVI at the end of a weekly general audience at the Vatican. Gotti Tedeschi was ousted after a no-confidence vote of the Vatican bank I.O.R. governing body on Thursday, May 24, 2012.
VATICAN CITY — The president of the Vatican bank has effectively been ousted after receiving a unanimous vote of no-confidence from bank overseers for having leaked documents and failed to do his job at a critical time in the Holy See’s efforts to show financial transparency, the Vatican and officials said.
Ettore Gotti Tedeschi has been a polarizing figure ever since he was named president of the bank, known as the Institute for Religious Works, or IOR, in 2009. He is under investigation for alleged money laundering by Italian magistrates, but the investigation isn’t believed to have factored into the decision since the Vatican considers the probe to be motivated by outside political interests.
The Vatican said in a statement Thursday that the vote was taken because of Gotti Tedeschi’s failure to fulfill the “primary functions of his office.” He himself has told prosecutors that he barely paid attention to the bank’s works, showing up only two days a week while tending to his primary position as head of Spain’s Banco Santander’s Italian unit in Milan.
In addition, Gotti Tedeschi was found to have leaked confidential documents to serve his personal and political interests, according to a person familiar with the Vatican’s investigation. The person requested anonymity because he was not authorized to speak about the matter.
The Vatican is in the midst of a scandal over leaked documents and has begun a criminal investigation into the source of the leaks, as well as appointed a commission of cardinals to get to the bottom of it.
In the statement, the Vatican said the board had grown increasingly concerned about the governance of the bank and that the situation had deteriorated recently.
During a regularly scheduled board meeting Thursday, the five superintendents, who include the former No. 2 at Deutsche Bank, Ronaldo Hermann Schmitz, and Carl Anderson, head of the Knights of Columbus, a major U.S. Catholic fundraising organization, unanimously adopted a no-confidence motion and recommended that Gotti Tedeschi’s mandate be terminated.
His fate isn’t final. On Friday the cardinals who sit on the IOR’s governing council are to meet to consider the board’s decision. While it wasn’t clear if they could ignore the no-confidence vote, the Vatican made clear the search was already on for a replacement.
“The council is now looking forward to search for a new and excellent president who will help the institute rebuild relationships between the institute and the financial community based on mutual respect based on internationally accepted banking standards,” the IOR said.
The no-confidence vote comes at a critical time for the Holy See in its efforts to shed the IOR’s image as a secretive tax haven battered by years of scandal.
The Holy See is heading into a July meeting of Moneyval, a Council of Europe committee that will determine whether it has complied with international norms to fight money laundering and terror financing. Transparency of the IOR’s finances has been one of several criteria that the Moneyval evaluators have investigated.
It wasn’t clear if the timing of Gotti Tedeschi’s ouster was aimed at sending a message to the Moneyval investigators, but just last week the Holy See met with them to discuss the preliminary findings of their report.
Gotti Tedeschi has long painted himself as the symbol of Vatican financial transparency, but the vote Thursday indicated that his primary collaborators on the board had found him to be anything but. He was faulted for not keeping the board of superintendents apprised of the work of the bank, among other failings.
Recently, he raised eyebrows when he made a joke about Hitler, war and economics.
Gotti Tedeschi was a frequent contributor to the Vatican newspaper and went on a very public speaking tour extolling the benefits of a morality-based financial system and citing frequently from the pope’s encyclical on the subject, “Charity in Truth.”
Italian authorities placed Gotti Tedeschi and the IOR’s top manager under investigation in September 2010 and seized (EURO)23 ($30 million) from a Vatican bank account at the Rome branch of Credito Artigiano Spa, after the bank informed the Bank of Italy about possible violations of anti-money laundering norms.
Gotti Tedeschi and the Vatican have denied any wrongdoing, calling the investigation a misunderstanding. No charges have been filed, and the money was subsequently released after the Vatican passed a series of measures to combat money laundering and create a financial watchdog authority – key requirements for the Moneyval process.
The Vatican bank was founded in 1942 by Pope Pius XII to manage assets destined for religious or charitable works. Located in a tower just inside the gates of Vatican City, it also manages the pension system for the Vatican’s thousands of employees.
The bank is not open to the public. Depositors are usually limited to Vatican employees, religious orders and people who transfer money for the pope’s charities.
The Vatican bank’s finances have long been shrouded in secrecy. Most famously, it was implicated in a scandal over the collapse of the Banco Ambrosiano in the 1980s in one of Italy’s largest fraud cases. Roberto Calvi, the head of Banco Ambrosiano, was found hanging from Blackfriars Bridge in London in 1982 in circumstances that remain mysterious.
Banco Ambrosiano collapsed following the disappearance of $1.3 billion in loans the bank had made to several dummy companies in Latin America. The Vatican had provided letters of credit for the loans.
While denying any wrongdoing, the Vatican bank agreed to pay $250 million to Ambrosiano’s creditors.
For a year Nuzzi was a conduit for sensitive documents that surfaced from deep within the Curia Romana, which he highlighted in his Italian television show The Untouchables. This week, he published the documents in full in a book called Sua Santità—Le Carte Segrete di Benedetto XVI or Your Holiness: The Secret Papers ofBenedict XVI. He says he kept the documents on a USB key sewn into his neckties, and he worried constantly that someone might try to harm him or steal them back.
Since his first television program, VatiLeaks has made a major impact in Rome. The reopening of the criminal investigation into the disappearance of Emanuela Orlandi, the 15-year-old daughter of a Vatican employee who disappeared 30 years ago, has come to symbolize the VatiLeaks scandal and a small victory for transparency in the Roman Catholic Church. And earlier this month, the Holy See conceded to allow the opening of the tomb of a notorious mobster who was interred inside a Vatican church in an unprecedented act of cooperation with Italian police who want to find the truth in the Orlandi case. “The people who provided these documents did it because they’d had enough of the lies,” Nuzzi told The Daily Beast. “They did it at great risk, and if they are ever found out, they will likely disappear without a trace.”
Nuzzi had touched a nerve with his 2010 Vatican SPA, an investigative book on the Vatican banking practices. He says he was likely chosen as the messenger for these documents because he had challenged the church before. When he was summoned to meet his main source, “Maria”—whose gender and age remain a secret—he says he didn’t know what to expect.
He was given keys to a nondescript apartment in the Prati district of Rome, which was completely void of furniture except for one plastic chair in the middle of the marble-floored living room. “As a journalist you often follow blind leads and meet with people who know little or nothing,” Nuzzi says. “But I knew right away that this was going to be the biggest thing I’d ever been involved with.”
The two had a standing meeting at the apartment on Thursdays to avoid having to use the telephone or other traceable means of communication. Sometimes other informants would come, other times “Maria” would fail to show up, so Nuzzi would go back the following week. He says he thinks his sources gave him the documents out of duty after witnessing years of lies and manipulation by the church. “Since Karol Wojtyla [Pope John Paul II] died, I started putting copies of documents aside that I came across in my job at the Vatican,” Nuzzi quotes “Maria” in the book. “The truth emerging in the newspapers and the official discourse within the Holy See was so different, the hypocrisy reigned supreme, and the scandals were multiplying. I’m not talking only about the pedophilia and murder cases like the killing of the Swiss Guard and the disappearance of Emanuela Orlandi, but about money laundering, corruption, and threats.”
Vatican slams new book of leaked documents as ‘criminal’
Published: 20 May, 2012, 10:11
Edited: 20 May, 2012, 20:41
Pope Benedict XVI ( REUTERS/Max Rossi)
The Vatican is threatening to take legal action against those responsible for publishing a new book of leaked internal documents. The book sheds light on power struggles and corruption inside the Holy See and the thinking of its embattled top banker.
Pope Benedict XVI has already appointed a commission of cardinals to investigate the “Vatileaks” scandal. It erupted earlier this year with the publication of leaked memos alleging corruption and mismanagement in Holy See affairs and internal squabbles over its efforts to comply with international anti-money-laundering norms.
The publication Saturday of “His Holiness” by Italian journalist Gianluigi Nuzzi, added fuel to the fire, reproducing confidential letters and memos to and from Pope Benedict and his personal secretary which, according to the Vatican, violated the pope’s right to privacy.
Vatican spokesman Rev. Federico Lombardi said in a statement Saturday the book was an “objectively defamatory” work that “clearly assumes characters of a criminal act.” He warned the Holy See would get to the bottom of who “stole” the documents, who received them and who published them. He warned the Holy See would seek international cooperation in its quest for justice, presumably with Italian magistrates.
The Vatican had already warned of legal action against Nuzzi after he published letters in January from the former second-highest Vatican administrator to the pope. In those letters the administrator begged not to be transferred for having exposed alleged corruption that cost the Holy See millions of euros in higher contract prices. The prelate, Monsignor Carlo Maria Vigano, is now the Vatican’s US ambassador.
Nuzzi, author of Vatican SpA, a 2009 volume laying out shady dealings of the Vatican Bank based on leaked documents, said he was approached by sources inside the Vatican with the trove of new documents. Most of them are of fairly recent vintage and many of them painting the Secretary of State, Cardinal Tarcisio Bertone, in a negative light.
Much of the documentation is fairly Italy-centric: about a 2009 scandal over the ex-editor of the newspaper of the Italian bishops’ conference, a previously-unknown dinner between Benedict and Italy’s president, and even a 2011 letter from Italy’s pre-eminent talk show host Bruno Vespa to the pope enclosing a check for 10,000 euro for his charity work and asking for a private audience in exchange.
But there are international leaks as well, including diplomatic cables from Vatican embassies from Jerusalem to Cameroon. Some concern the conclusions of the pope’s delegate to the disgraced Legion of Christ religious order. In a memo sent to the pope last autumn he warned that the financial situation of the order, beset by a scandal over its pedophile founder, “while not grave, is serious and pressing.”
Ettore Gotti Tedeschi, the head of the Institute for Religious Works, otherwise known as the Vatican Bank, gets significant ink. His private memos to the pope with his take on the Vatican’s response to the global financial crisis and how to handle the church’s tax exempt status amid Italian government efforts to crack down on tax evasion have also been published.
The bank has been trying for some two years to remedy its reputation as a shady tax haven beset by scandals. One of them is the collapse of Italy’s Banco Ambrosiano and the death of its head, Roberto Calvi, who also helped manage Vatican investments and was found hanging from London’s Blackfriars Bridge in 1982.
In a bid to show it has mended its ways, the Institute for Religious Works this week invited ambassadors from 35 countries in for a tour and a chat with its managing director as part of a new transparency campaign. The tour came on the same day Holy See representatives were in Strasbourg discussing the first draft of a report from a Council of Europe committee on the Vatican’s compliance with international norms to fight money laundering and terrorism financing.
British Ambassador Nigel Baker, who went on the Institute for Religious Works tour, later blogged that the Vatican’s reputation depends on showing that its institutions are transparent.
“Plenty still needs to be done. But the Holy See needs to stick to its guns. It is in their interest, and ours,” Baker wrote.