Pope Francis Implicated In Jaw Dropping Money Laundering Case

Pope Francis Implicated In Jaw Dropping Money Laundering Case

By Lucy Caulkett-

Vatican prosecutors have alleged a jaw-dropping series of scandals in the biggest criminal trial in the Vatican’s modern history, which opens on Tuesday in a modified courtroom in the Vatican Museums.

A once-powerful cardinal and nine other people are accused of bleeding the Holy See of tens of millions of dollars in donations through bad investments, deals with shady money managers and apparent favours to friends and family.

They face prison sentences, fines or both if convicted.

The trial, which will likely be postponed for several months after the first hearings on Tuesday and Wednesday, is the culmination of a two-year investigation into the Holy See’s flawed 350 million-euro London property venture.

It follows a two-year probe into how the Secretariat of State — the key department in the Vatican’s central administration — managed its vast asset portfolio and, in particular, who knew what about a disastrous 350-million-euro ($415 million) London investment.

Two London-based Italian financiers were involved in buying the 17,000-sq metre building — a former Harrods warehouse in Chelsea intended for conversion into luxury apartments.

Gianluigi Torzi and Raffaele Mincione are charged with embezzlement, fraud and money laundering.

The building’s purchase at an inflated price meant “substantial losses for the Vatican, and dipped into resources intended for the Holy Father’s personal charitable work”, the Holy See said before the trial.

That operation exposed the Vatican’s once-secret financial dealings and its structural dysfunction, which allowed just a few people to do so much damage to the Vatican’s finances and reputation, with little expertise or oversight.

But the prosecutors’ case also suggests that Pope Francis and his top lieutenants were not only aware of some of the key transactions, but in some cases explicitly authorised them, even without full documentation or understanding the details.

One Vatican monsignor who until recently was considered by prosecutors to be a key suspect, Monsignor Alberto Perlasca, managed to avoid indictment.

Mgr Perlasca’s office handled the London investment from start to finish and his boss had identified him as the main in-house culprit in obscuring the deal’s costly outcome.

But prosecutors suggested that Mgr Perlasca flipped and became an important witness, in part after coming under pressure to recant his evidence by the lone cardinal on trial, Angelo Becciu.

Francis, who as absolute monarch wields supreme legislative, executive and judicial power in Vatican City, has in many ways already convicted Becciu.

Last year, Francis presented Becciu with evidence that he had sent 100,000 euros in Vatican funds to a Sardinian charity run by Becciu’s brother.

Francis secured Becciu’s resignation as head of the Vatican’s saint-making office and then stripped him of his rights as cardinal, a sanction that was announced immediately by the Vatican press office.

Becciu, who is charged with embezzlement and pressuring Mgr Perlasca to recant, has denied any wrongdoing.

The onetime chief of staff in the Vatican secretariat of state, Becciu is also linked to a mysterious figure who is also on trial, Cecilia Marogna, whom he hired in 2016 as an external security consultant.

Prosecutors allege Marogna embezzled 575,000 euros in Vatican funds that Becciu had authorised for ransoms to free Catholic hostages.

Bank records from her Slovenian front company show the Vatican wire transfers were used instead to pay bills at luxury shops and boutique hotels.

ollows a two-year probe into how the Secretariat of State — the key department in the Vatican’s central administration — managed its vast asset portfolio and, in particular, who knew what about a disastrous 350-million-euro ($415 million) London investment.

– ‘Substantial losses’ –

Two London-based Italian financiers were involved in buying the 17,000-sq metre building — a former Harrods warehouse in Chelsea intended for conversion into luxury apartments.

Gianluigi Torzi and Raffaele Mincione are charged with embezzlement, fraud and money laundering.

The building’s purchase at an inflated price meant “substantial losses for the Vatican, and dipped into resources intended for the Holy Father’s personal charitable work”, the Holy See said before the trial.

The first part of the purchase happened while Becciu was No. 2 at the Secretariat of State, and in charge of the purse strings.

Between 2013 and 2014, the Secretariat of State borrowed over 200 million dollars, mainly from Credit Suisse, to invest in Mincione’s Luxembourg fund. Half went to buying part of the London property.

The rest was for stock market investments, but Mincione used it for high-risk ventures. The Holy See, which had no control over where the money went, tried to pull out in 2018.

– Taking control –

Torzi was brought in and tasked with brokering the purchase of the rest of the building and cutting ties with Mincione — but he instead allegedly joined forces with him.

He arranged for the Holy See to give Mincione £40 million (48 million euros; $55 million) for the shares in the part of the London building it did not already own.

But Torzi then allegedly inserted a clause into the paperwork which gave himself control of the property. He is accused of demanding 15 million euros to relinquish control.

Marogna says the money was legitimate compensation and reimbursement for her intelligence-related expenses.

The London property deal dates to 2014, when the Vatican’s secretariat of state decided to invest an initial 200 million euros in a fund operated by Italian businessman Raffaele Mincione, with half the money put into the London building, half in other investments.

By November 2018, the original investment had lost 18 million euros, prosecutors say, prompting the Vatican to seek an exit strategy while retaining its stake in the building in London’s swank Chelsea neighbourhood.

The Vatican in Rome, viewed from the top of St Peter’s Basilica (Phil Noble/PA)

The Vatican in Rome, viewed from the top of St Peter’s Basilica (Phil Noble/PA)

Two London-based Italian financiers were involved in buying the 17,000-sq metre building — a former Harrods warehouse in Chelsea intended for conversion into luxury apartments.

Gianluigi Torzi and Raffaele Mincione are charged with embezzlement, fraud and money laundering.

The building’s purchase at an inflated price meant “substantial losses for the Vatican, and dipped into resources intended for the Holy Father’s personal charitable work”, the Holy See said before the trial.

But prosecutors say Torzi then hoodwinked the Holy See by secretly restructuring 1,000 shares in the property’s new holding company in a way that gave him full voting rights.

Prosecutors say Torzi then extorted the Vatican for 15 million euros to get control of the building that it thought it had already acquired.

Mincione and Torzi, who are accused of fraud, money laundering, embezzlement and other charges, have denied wrongdoing.

Brokering

Torzi was brought in and tasked with brokering the purchase of the rest of the building and cutting ties with Mincione — but he instead allegedly joined forces with him.

He arranged for the Holy See to give Mincione £40 million (48 million euros; $55 million) for the shares in the part of the London building it did not already own.

Torzi then allegedly inserted a clause into the paperwork which gave himself control of the property. He is accused of demanding 15 million euros to relinquish control.

Becciu’s successor as chief of staff, Archbishop Edgar Pena Parra, told prosecutors that Francis had made clear by November 2018 that he wanted to lose as little money as possible to finally secure ownership of the building and “turn the page and start over”.

It was a message Francis repeated to Torzi himself during a January 2019 meeting, Archbishop Pena Parra told prosecutors.

After realizing that Torzi actually controlled the building and based on Francis’ desire to move forward, the arhchbishop said the Vatican had two choices.

Those were to sue him or pay him off for the 1,000 voting shares that he owned.

The archbishop said the Vatican’s concern was that suing him could take years and even possibly end in Torzi’s favour.

“Between these two options, with the advice of lawyers and experts, option number two was chosen because it was considered more economical, with more contained risks and in a more manageable time frame,” the archbishop wrote in his evidence.

“It also simply aligned with the desire of the Superior,” a reference to Francis.

The Vatican in Rome, viewed from the top of St Peter’s Basilica (Phil Noble/PA)
The Vatican in Rome, viewed from the top of St Peter’s Basilica (Phil Noble/PA)
And yet the payout of 15 million euros to Torzi is at the heart of the case.

Prosecutors accuse Torzi of extorting the Vatican for the money and the Vatican’s financial oversight agency of failing to stop the deal.

The oversight’s managers say the Vatican had no choice but to pay Torzi, given the Secretariat of State, knowingly or not, signed legally binding contracts that gave Torzi control of the building.

Prosecutors say the secretary of state, Cardinal Pietro Parolin, was deceived into approving Torzi’s contract by a lawyer who drafted a one-page memo describing the deal but omitting key details, including Torzi’s voting stake.

Archbishop Pena Parra said only later did the Vatican realise the lawyer was associated with Torzi.

Quoting Cardinal Parolin’s own notes, the archbishop said the cardinal approved the deal based on the lawyer’s brief memo and assurances from Mr Perlasca and another Vatican money manager, Fabrizio Tirabassi.

Cardinal Parolin, Archbishop Pena Parra and Mgr Perlasca were not charged.

Tirabassi is charged with corruption, extortion, embezzlement, fraud and abuse of office; he denies wrongdoing.

 

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