Europe

Vatican bank managers resign in wake of monsignor’s arrest

Moves come days after Pope Francis set up inquiry to get to grips with bank’s problems

A flower mosaic is created in Saint Peter’s Square at the Vatican. The director and deputy director of the Vatican’s bank have resigned following the arrest of a senior cleric with close connections to the bank who is accused of plotting to smuggle €20 million into Italy from Switzerland. Photograph: Franco Origlia/Getty Images

Mon Jul 1 2013 - 20:03

The director and deputy director of the Vatican bank resigned today following the arrest of a senior cleric with close connections to the bank who is accused of plotting to smuggle €20 million into Italy from Switzerland.

A statement from the Vatican said Paolo Cipriani and Massimo Tulli had handed in their resignations, three days after the arrest of Msgr Nunzio Scarano, an accountant in a Vatican department who is the subject of two separate investigations by Italian magistrates.

Ernst von Freyberg, the bank’s president, will take over as interim director-general, and a new position of chief risk officer will also be created to improve compliance with financial regulations.

In the latest of a series of blows to the Vatican's scandal-plagued bank, Msgr Scarano (61), was arrested on Friday along with Giovanni Zito, a secret services agent, and financial broker Giovanni Carenzio.

READ MORE

The three are accused of plotting to bring €20 million in cash to Italy from Switzerland for Msgr Scarano’s shipping industry friends in the southern city of Salerno, where Msgr Scarano is facing a separate investigation on suspicion of money laundering.

Special inquiry

News of the resignation of two of the top managers at the Vatican bank, known formally as the Institute for Works of Religion (IOR), comes only days after Pope Francis set up a special commission of inquiry to get to grips with the bank's long-standing problems.

As part of the management changes announced today, Rolando Marranci was named as acting deputy director-general and Antonio Montaresi was named as acting chief risk officer. A selection process has begun to make permanent appointments.

The future of the IOR has been clouded by uncertainty since the arrival of Pope Francis, who has laid great emphasis on cleaning up the financial scandals which have tainted the bank for decades.

The IOR gained notoriety in 1982 when Roberto Calvi, an Italian banker with close connections to the Vatican bank, was found hanging from Blackfriar's Bridge, near the financial district in London. A court ruled he had been murdered, but the crime has never been solved.

Reuters

LATEST STORIES