ROME — The Istituto per le Opere Religiose, commonly known as the Vatican Bank, is under investigation by Italian authorities for money laundering.
In particular, bank Chairman Ettore Gotti Tedeschi and Director-General Paolo Cipriani are under investigation for alleged failure to observe Italy’s money laundering laws.
Law enforcement officials have also seized $30 million (23 million Euros) in bank assets as part of their investigation into claims that the two senior officials had violated anti-money laundering laws by failing to disclose information about the bank’s financial transactions.
“The Holy See is perplexed and astonished by the initiatives of the Rome prosecutors, considering the data necessary is already available at the Bank of Italy,” the Vatican said in a statement.
The Vatican also backed he two officials under investigation.
“The Holy See wants to express the maximum confidence in the president and in the chief executive of the IOR,” it said.
Gotti Tedeschi has been in charge of the bank for about a year.
It is the first time such action has been taken against the IOR, which is considered a non-European Union bank and does not fall under the jurisdiction of EU banking laws.
The Vatican is an entirely sovereign state, so it is unclear exactly how much the Italians can do.
The probe was started by Rome to determine whether a 2007 Italian law on transparency in regard to the identity of account holders was violated.
The Vatican Bank is one of the most secret banks in the world, and judicial sources said the probe was centered on clarifying the “opaque screen” which hid the identity of the organizations that had actual control over the IOR accounts.
The investigation is focused on two wire transfers the Vatican Bank had asked a small Italian bank called Credito Artigianato to carry out, including the transfer of 20 million euros to JP Morgan in Frankfurt and 3 million euros to another Italian bank, Banca del Fucino. Authorities say the IOR did not disclose enough information about these transactions.
"I wish to express my personal solidarity to the President of the IOR, Ettore Gotti Tedeschi, which I know the seriousness and professional integrity,” said Roman Mayor Gianni Alemanno. “I hope that this story will be clarified as soon as possible.”
The Vatican Bank last faced legal scrutiny in 1982 when its governor, the American Archbishop Paul Marcinkus, was implicated in a scandal that led to the murders of two of its top executives, one of whom was found hanging from Blackfriars Bridge in London. Upon the election of Pope John Paul II, Marcinkus was promoted within the Vatican bank and remained in office for several years before the scandal widened, when the body of Calvi, whose Banco Ambrosiano had dealt with Marcinkus, was found hanging over the bridge in June 1982.
It was a scene that was loosely mirrored in “The Godfather Part III.”