Pope tightens Vatican Bank safeguards

ATM-in-LatinIn a further move designed to bolster reform of the troubled Vatican Bank, Pope Francis has issued a decree designed to ensure that the Istituto per le Opere di Religione (IoR), to give it its proper name, cannot be used for money-laundering by criminals and terrorists.

The motu proprio — a decree on the personal initiative of the Pope — has bolstered the powers given to the Vatican’s watchdog, the Financial Information Authority (FIA), over the IoR and other departments in the Vatican involved in finance. (See Reuters here, BBC here.)

The move follows a recommendation by MoneyVal, the European watchdog brought in by Pope Benedict, which recently carried out a second audit.

“In today’s world, it is all about resisting increasingly insidious forms of financial criminality,” said Fr Lombardi, Vatican spokesman. “We have to be equal to the challenges in order to protect legality, and not be left behind.”

According to the Vatican statement, the motu proprio

  • strengthens the supervisory and regulatory function of the Financial Information Authority;
  • establishes the function of prudential supervision over entities habitually engaged in financial activities, in response to a recommendation of the MONEYVAL Committee of the Council of Europe, and assigns that function to the Financial Information Authority;
  • establishes the Financial Security Committee, whose Statutes are appended to the Motu Proprio, for the purpose of coordinating the competent authorities of the Holy See and the Vatican City State in the area of prevention and countering of money laundering, the financing of terrorism and the proliferation of weapons of mass destruction.

The decree is the latest in a long series of reforms begun under Benedict XVI to bring the IOR into line with international best practice in transparency and accountability. (For detailed background, see previous CV Comment post here.)

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