Is the Vatican Finally Getting Serious About Cleaning Up Its Finances? The Appointment of an Antimafia Magistrate Is A Promising Sign

Questions about Vatican finances have dogged the Church for decades. In 2012, leaked documents revealed allegations of extensive cronyism and money laundering; these documents suggested, for example, that the Church’s main charitable mission, Peter’s Pence, was being used to fund the lavish lifestyle of some members of the clergy. Though Pope Benedict XVI had attempted to institute financial auditing procedures, his efforts proved insufficient, and the scandal was widely seen as part of the reason for his controversial decision to resign the papacy. Unfortunately, the scandals have continued under Pope Francis. In 2015, the Church purchased a bankrupt Italian hospital in part with money borrowed illicitly from a publicly funded Italian hospital; the transaction, arranged off-the-books, was partly coordinated by a Swiss bank with a reputation for money laundering. In 2019, it was revealed that the Vatican had invested roughly $200 million, at least in part from Peter’s Pence, in luxury real estate in London. The purchase was partially financed through a since-discredited Swiss bank, and the loans were not properly recorded in the Vatican’s internal records. It was also revealed that the Vatican was investing millions of dollars through the Centurion Global Fund, which is connected to the same Swiss bank that ran the London purchase, as well as to a pair of banks that have been linked to a Venezuelan bribery and money-laundering scandal. While it is possible that some or all of these transactions may prove to have been the product of poor financial decision-making rather than corruption, these and other incidents have called into question the Church’s management of its finances as well as the integrity of its internal watchdog mechanisms

Pope Francis, who ascended to the papacy with promises of reform, has publicly acknowledged that there is corruption within Vatican finances and has pursued measures to restore confidence in the Church’s financial management. However, many of his attempts to institute more rigorous reforms have been frustrated by internal Vatican power struggles. For instance, in 2016 the powerful Archbishop Giovanni Becciu unilaterally stopped a scheduled audit of Vatican finances, and in 2017 the Vatican’s auditor-general was forced out of office, allegedly after finding evidence of financial irregularities. But in late 2019, Pope Francis stepped up his efforts to crack down on malfeasance and get the Vatican’s financial house in order. Francis took a particularly high-profile step in October 2019, when he appointed one of Italy’s leading antimafia magistrates, Giuseppe Pignatone (who retired from the Italian judiciary in May 2019), as head of the Vatican’s criminal tribunal, which is tasked with investigating corruption and fraud, among other crimes. Although some have portrayed Pignatone’s appointment as a sign of desperation by a Pope who cannot control his own bureaucracy, this choice was in fact a wise move by Francis to consolidate his reformist agenda. Pignatone’s former position as one of Italy’s most prestigious antimafia magistrates means that he is particularly well-placed to address Vatican corruption, for three reasons. Continue reading

Can Religion Reform Cultures of Corruption? Lessons from the Philippine Catholic Church

During his visit to the Philippines earlier this year, Pope Francis called on the Philippine government to put an end to corruption in the country, and challenged citizens “at all levels of society, to reject every form of corruption which diverts resources from the poor.” While the Pope’s admonishment may seem like mere rhetoric to some, his call to action may have more significant political implications in a country where nearly 83% of the population identifies as Catholic, and where the Church plays a major institutional role in the nation’s culture and government.

In his 2010 piece “’Good News’ in the Fight Against Corruption,” and more recently in a June 2014 working paper on systemic corruption, Professor Roberto Laver highlighted the role religion plays as a cultural force in society, which in turn may impact how societies respond to corruption in government. Religion can affect ethical behavior in obvious ways, but it can also affect how public power and authority are arranged within society. Professor Laver argued that religion, which is often overlooked as a resource for anticorruption efforts, should be used as an “entry point” for a “second generation of reforms” to battle entrenched cultures of corruption.

Assuming Professor Laver is correct that religious institutions are not playing a large enough role in anticorruption efforts worldwide, the Philippine Catholic Church may be an exception to that rule. The Church has been at the center of numerous political debates for decades, and, if the Pope’s speech earlier this year is any indication, it will continue to play a major role in issues involving development, poverty, and corruption. The Philippine example highlights the essential role an institution like the Catholic Church can play in addressing systemic corruption. And by the same token, it demonstrates the costs that come with entrusting that power to religious institutions and leaders.

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