Vatican’s former audit chief launches €9.3m legal case over dismissal

The Vatican’s former chief auditor and his deputy, who were dismissed in 2017 after trying to investigate the Catholic church’s “off the books” Swiss bank accounts, have launched a €9.3 million legal action against the Holy See.

Libero Milone and his number two Ferruccio Panicco are claiming damages for lost earnings, emotional distress and loss of reputation over how they were forced from their jobs after being accused of misconduct. They were later publicly accused by then-powerful Cardinal Giovanni Angelo Becciu of spying on the private lives of their Holy See superiors, including Becciu himself.

Milone, a former head of Deloitte Italy, had been picked in 2015 to establish an auditor-general’s office for the Holy See, as Pope Francis sought to clean up the church’s financial affairs, including management of millions of euros in charitable contributions from Catholic faithful around the world.

But Milone said he and his team were stonewalled in their requests for details of Vatican-owned Swiss bank accounts later found to have been used by the Holy See to invest about £300 million between 2014 and 2018 in a luxury property development in central London. The transactions were authorised by the Vatican secretariat, of which Becciu was the second-in-command.

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Though Vatican authorities claimed there was “irrefutable evidence” against Milone at the time of his departure, they subsequently shelved the case but never publicly exonerated him.

I’m put on the cross because I did the right things. There’s a small mafia in the Vatican that tries to block any change and keep things as they are

Milone, who has always denied wrongdoing, said the episode effectively destroyed his professional life and reputation.

“I’m put on the cross because I did the right things,” he told reporters at a briefing in his lawyer’s office this week. “There’s a small mafia in the Vatican that tries to block any change and keep things as they are. They still live in the medieval era.”

Since Milone’s departure, the Vatican has suffered embarrassing public revelations over its financial decisions, prompting a reorganisation of the management of its charitable donations. The Vatican realised well over £100 million in losses when the London property at the centre of the revelations was sold to Bain Capital for £186 million a few months ago.

Becciu, once a close aide of the Pope, was stripped of his responsibilities in the Vatican in 2020. He and nine other people were indicted by the Vatican prosecutor last year for financial wrongdoing, including embezzlement and abuse of office in connection with investments into the London property project. Becciu has always denied any wrongdoing. His trial is ongoing.

Milone said his years at the Vatican were the “most difficult” of his career. Though he expected the assignment to be “an opportunity to contribute to the modernisation of the church”, he ran into fierce resistance from powerful individuals uncomfortable with his efforts to bring transparency and accountability.

The former chief auditor said he initially met monthly with the Pope to brief him on his work, but had been denied any papal audiences for the entire year before he was forced out. He had also found his office was bugged within weeks of starting the job.

“We did what we had to do but, unfortunately, what we had to do was very embarrassing [for the Vatican],” he said.

Milone also said the continuing ambiguity over his departure from the Vatican had undermined his ability to find work in Italy, where the Holy See carries great influence in public life.

“In Italy, there is a high level of embarrassment when the Vatican is involved. You can’t go and cross the Vatican,” he added.

The Vatican press office declined to comment on Milone’s claims. But it said the Holy See’s promoter of justice, who is the city-state’s chief prosecutor, had reopened the suspended probe into Milone’s case in the spring. – Copyright The Financial Times Limited 2022