It may be inside baseball, but Vatican financial reform still matters

It may be inside baseball, but Vatican financial reform still matters

It may be inside baseball, but Vatican financial reform still matters

Members of the Swiss Guard march in front of the Torre di Niccolo, the headquarters of the Institute for the Works of Religion, better known as the "Vatican bank." (Credit: Stock image.)

The intrigues and unanswered questions surrounding Vatican finances may seem minor in comparison to the world's great challenges, but there are several reasons why the effort for reform matters.

News Analysis

ROME – This week, a letter emerged written by Giulio Mattietti, a former adjunct director of the Institute for the Works of Religion, better known as the “Vatican bank,” asking for an explanation of why he was fired on Nov. 27, the same day Pope Francis arrived in Myanmar for the start of a six-day trip to Asia.

At the time, no reason was offered for the move, despite the fact reports suggested security agents not only escorted Mattietti out of the bank but off the physical territory of the Vatican. A few days later, amid mounting speculation, officials of the bank issued a statement saying the firing was “fully legitimate” and “normal and physiological,” and that the reasons had not been communicated “solely to protect the interests of those involved.”

That didn’t really satisfy anyone, apparently including Mattietti.

In the absence of a compelling explanation, many observers – myself included – couldn’t help but connect the Mattietti dismissal with other recent mysterious disappearances of people involved in Vatican financial administration, such as the June ouster of former Auditor General Libero Milone, once again without any motives stated.

RELATED: Latest Vatican mystery raises more questions about pope’s financial reform

To be fair, those of us who drew the connection should have been clear that we were engaging in a somewhat apples-and-oranges exercise.

Milone was a key figure on the Vatican landscape, the number one official in an office that was presented to the world in 2014 as the lynchpin of the pope’s financial reform. It was described as the bulwark of accountability that would keep everyone honest, and Milone’s personal background and integrity were said to be important guarantees.

Mattietti, on the other hand, as an “adjunct” director of the bank, maybe wasn’t quite middle management, but he certainly wasn’t the top dog. That’s French economist and finance expert Jean-Baptiste de Franssu, who’s held the post since July 2014, and who’s very much the one calling the shots.

To be honest, prior to Nov. 27, even most veteran Vatican observers had never heard of Mattietti. To suggest that anything crucial rises or falls with his departure, therefore, probably would be a stretch.

Another factual point that shouldn’t be lost is that enormous strides have been made in recent years to clean up operations at the Vatican bank, beginning with the creation of the Financial Information Authority (known by its Italian acronym AIF) under Pope Benedict XVI to exercise due diligence, including flagging suspicious transactions. By now, most illegitimate accounts at the bank have been closed and industry-standard paper trails have been established.

Also of importance is a memorandum of understanding signed in 2013 between AIF and the Financial Information Unit of the Bank of Italy. The message that sent to the financial community was loud and clear: Don’t try parking your assets in the Vatican bank anymore to avoid Italian tax obligations, because they’re going to know.

In other words, whatever questions the Mattietti case may raise, the overall record of movement in the right direction shouldn’t be lost.

Still, the circumstances of both departures clearly suggest transparency remains a work in progress. Assuming the Vatican has good reasons for forcing these figures out, why don’t they simply tell us?

It won’t do anymore to say the aim is to protect the reputations of those involved, because by now both Milone and Mattietti will be surrounded by a permanent cloud of suspicion until things are cleared up. Frankly, whatever they may have done is unlikely to be as bad as some conspiracy theories already posit.

At this point, many people may be tempted to ask: Who cares?

All this can seem the ultimate in insider baseball, something that only a handful of real Vatican junkies could possibly find relevant. We’re talking about obscure personalities, horribly complicated storylines, and relatively small stakes – to take the Vatican bank, its $8 billion in assets isn’t exactly chump change, but it’s hardly a financial colossus either. By way of comparison, JP Morgan, the largest bank in the U.S., controls $2.5 trillion in assets.

It’s totally reasonable to argue that preaching the Gospel, feeding the hungry, ending war and saving the planet are all far more important than who’s up and down in Vatican power games, or massaging the fine points of how its systems work.

Still, there are at least three reasons why the financial operation of the Vatican matters.

First, the Vatican sets a tone for church operations in other parts of the world. For decades now, dioceses and other church operations that have adopted state-of-the-art financial protocols have done so in spite of the Vatican’s example, not because of it. It would obviously be nice if it were the other way around.

(More times than I can count over the years, I’ve heard cardinals and bishops from around the world laugh over the mysteries of Vatican finances. The thing is, of course, the situation is funny until it isn’t – until some new scandal erupts, creating yet another impediment to getting the Church’s message across.)

Second, financial reform is an important litmus test of Francis’s credibility. He speaks a great deal about the corrupting power of money and the need to resist it, but if he can’t make that stick in the environment over which he has most direct personal control, then one may legitimately wonder whether it’s all just hollow rhetoric.

Third, Catholics the world over have a right to expect that money they donate to the Church will be well-managed. It’s probably a miracle that so many continue donating despite clear evidence to the contrary in far too many cases, but abusing the generosity of the rank-and-file obviously is no excuse for failing to get serious.

To be clear, it may be that getting serious is precisely what’s going on with both Milone and Mattietti. If one pillar of reform is transparency, however, then eventually someone probably is going to have to say so out loud, and to explain why.

Latest Stories

Most Read

Crux needs your monthly support to keep delivering the best in smart, wired and independent Catholic news.

I want to support Crux!

Latest Stories