New woes and new faces at Vatican FIU
Chris Hamblin, Clearview Publishing, Editor, London, 10 July 2014
Vatican City's Financial Intelligence Authority, the financial intelligence unit that doubles as the anti-money-laundering regulator, is looking into Vatican Bank’s practice of blacking out the names of high-net-worth account holders in its transactions with Italian banks.
Rene Bruelhart, the director of the Financial Intelligence Authority in the tiny but well-connected jurisdiction of Vatican City in Rome, is looking into Vatican Bank’s practice of blacking out the names of high-net-worth account holders in its
transactions with Italian banks. The private bank is formally known as the Institute for Religious Works.
Vatican Bank has embarked on a process of internal reform partly because of pres- sure from large banks with which it has always had a business relationship. These banks, which include Deutsche Bank, JP Morgan, HSBC and UniCredit, have themselves come under regulatory pressure because of their Vatican connections.
Pope Francis recently sacked the entire board of the Financial Information Authority, which serves as the Holy See’s internal regulatory office and financial watchdog. The pontiff replaced its outgoing members with four experts from Italy, Singapore, Switzerland and the United States. This was thought to be in line with the wishes of Bruelhart, Liechtenstein’s former top anti- money laundering expert who was dissatisfied with the old board-members, Italian Catholic laymen to a man.
Only now, more than a decade since the UK forced ‘retrospection’ on its banks and all its overseas territories, is the Vatican finally catching up. Every account going back to Charlemagne is under scrutiny, according to the FIA. Bruelhart’s annual report has revealed that 202 suspicious transaction reports were made in 2013 compared with only six a year earlier and just one in 2011, but he attributes this ‘spike’ to the backlog. A mere five cases are in the hands of Vatican prosecutors.The day before a US company called Promontory Financial Group started screening all accounts, according to the Italian press last year, the bank closed 900. These included embassy accounts for Indonesia, Iran and Iraq. One of these reportedly moved €½ million for the purposes of ‘refurbishment’ without another word of explanation. Such movements are said to have been common.
