Vatican bank investigated for money laundering

Vatican bank investigated for money laundering

In yet another scandal for the Catholic Church, Italian authorities are investigating the Vatican Bank on suspicion of money laundering: 

The Bank of Italy investigation was prompted by two wire transfers which the Vatican Bank asked Credito Artigiano to carry out, the Bank of Italy said.

The Vatican Bank did not provide enough information about the transfers — one for 20 million euros (about $26 million), and one for 3 million euros (about $4 million) — to comply with the law, prompting the Bank of Italy to suspend them automatically, it said.

The Vatican Bank is subject to particularly stringent anti-money laundering regulations because Italian law does not consider it to operate within the European Union.

This is not the first time the bank, formally known as the Institute for Works of Religion, has been under suspicion. The bank has been accused in the past of laundering money for the Sicilian mafia and the Gambino crime family as well as helping Croatia’s pro-Nazi wartime government steal the assets of Holocaust victims.

The current investigation could add more fuel to the current debate over Vatican sovereignty, which was prompted by the pope’s recent visit to Britain. Anti-pope campaigners like the British LGBT activist Peter Tatchell argue that the Holy See’s officially recognized sovereignty and observer status at the United Nations give it unwarranted authority in international debates over subjects like birth control, abortion and homosexuality while protecting priests and Vatican officials from prosecution. 

As I wrote in a recent explainer piece, the Holy See has worked hard to cement its sovereign status since it was first recognized under a treaty with Benito Mussolini’s Italy in 1929. It currently enjoys diplomatic relations with 176 countries in spite of the fact that has no fixed population and controls virtually no territory, usually prerequisites for statehood.

But in light of the fact that Vatican sovereignty can be used as a tool to protect both accused pedophiles and money launderers, it might be time to consider whether the Catholic Church deserves a special recognition under international law not granted to any other religion.