The new statute of the Vatican Financial Information Authority (AIF) better aligns the Authority with new Vatican legislation, and with international standards. It also develops a new kind of Authority. Conceived by the drafter of the first Vatican money laundering law as a sort of «monocratic» authority (a Vatican dicastery presided by a cardinal with broad overall powers) the Financial Information Authority is taking a new shape as a result of progressive improvements to its statue.  

The appointment procedures for the president of the authority have changed. According to article 4 of the old motu proprio that established the Authority, the president was appointed by the pope, just like the head of a Vatican dicastery, and so it was taken for granted that the president should be a cardinal, or at least an archbishop. From November 21 on – when the new statutes has come into effect – the president will be chosen, together with the other four members of the board of directors, «among persons of proven reputation, free from any conflicts of interest and having recognized professional competence in the legal, economic and financial fields as well as in the subject-matters that fall within the scope of activity of the Authority.»

The statute of the Financial Information Authority makes the Authority brand new. The director becomes one of the statutory office holders, to be appointed together with a deputy director. Both are appointed by the Secretary of State.

This is how the Vatican legal/institutional framework to counter money laundering and prevent the financing of terrorism has been further improved, following the recommendations given by MONEYVAL, the Council of Europe’s committee that evaluates the path to financial transparency of its member states.

Tracing back the path that led to this new statute helps us to appreciate all the work done at an institutional level by the Vatican.

The old money laundering law, modeled in the Italian money laundering law, focused the Authority’s functions on its president, just as if he was the head of a Vatican dicastery. Cardinal Attilio Nicora, one of the sponsors of the former law, was appointed president of the Authority. Nicora is still the president of the reformed Authority, which will oversee all the Holy See’s financial and economic affairs.

At the time he was appointed president of the AIF, Nicora was also president of the Administration of the Patrimony of the Apostolic See (APSA) and a member of the board of cardinals of the Institute for Religious Works (IOR) and of the Governorate of Vatican City State. All of these entities were under his supervision as president of the AIF.

The former money laundering law had several shortfalls. For example, a division of labor was missing. The responsibilities of the Vatican Gendarmes Corps, Vatican City State Governorate and Secretariat of State were not precisely delineated. The international cooperation system did not take into account the Holy See’s idiosyncrasies.

These «shortcomings» were a result of the law having been written by external consultants, surely competent on money laundering, but seemingly not cognizant of the Holy See’s sovereignty and its particular nature.

This is why Holy See officials had to adjust the legal/institutional framework. The new money laundering law was issued in a decree on January 25 and met many of the MONEYVAL evaluators’ observations. The new law represented the first quick fix of the institutional framework, to give more weight to the Secretariat of State and to build a customized financial system, tailored to Vatican City State’s particularities (such as the Vatican having no banks and no market economy.)

The MONEYVAL plenary assembly welcomed the changes, and it issued in July 12, 2012 a generally positive report on the Holy See/Vatican City State. The report, as could be expected, requested some adjustments to the law.

Some of these adjustments regarded the Financial Information Authority, and the Holy See carried forward the reform process step by step. In December 2012, two adjustments to the money laundering law gave the AIF the power to issue memorandums of understanding with its counterparts in other countries without the prerequisite of a nihil obstat (no objection) from the Secretariat of State.

These two adjustments further improved the procedures for cooperation and international exchange, and facilitated the AIF joining the Egmont Group (comprised of financial intelligence units from all over the world) in July 2013.

The enhanced authority of the AIF led to the signing of several memorandums of understanding, the most important of them with the U.S.’ FinCEN and with the Italian Unit for Financial Information.

In the meantime, a more general reform of the Vatican financial system was being prepared. With a motu proprio issued August 8, 2013 Pope Francis established the Financial Security Committee (whose members include the director of the Authority), and in October 8, 2013 a new law was issued, which gave the Holy See a sort of «single reference text for financial issues,» according to its characterization by the Vatican Secretary for the Relations with States, Monsignor Dominique Mamberti.

There are three important novelties in the new AIF statute: first of all, it strengthens the independence of the Authority, thus protecting it from possible interferences and power struggles among very prominent people within the Roman Curia; it officially assigns to the Authority prudential supervision, an important issue noted in the MONEYVAL report; and, lastly, as requested by the evaluators, it distinguishes the two functions of the Authority, by establishing two different departments, the Office of Supervision and Regulation and the Office of Financial Intelligence. This distinction made some observer note that the Authority for Financial Information could even be renamed “Authority for Oversight and Financial Information.”

The new AIF president will probably be a lay person, while the tenure of current board of directors seems to be reaching to an end. The board is comprised of Italians, coming (with a couple of exceptions) from the Bank of Italy milieu, who view their work through the anachronistic lens of  a Vatican-Italy special relation.

The appointments of the new president and board of directors, expected soon, will put an end to the only conflict of interest that the MONEYVAL report highlighted. The report did not name the person in the conflict of interest, but it was evident that it was Cardinal Nicora. In paragraph 797, the report underscores that «one of the members of the Cardinals’ Committee is also President of the AIF. This could raise concerns regarding a serious conflict of interest. It is therefore strongly recommended that the same person should not hold positions in the supervisory body and a supervised body.»

One of the very last actions of Benedict XVI was the renewal of the IOR cardinals’ commission. In the commission, Nicora was replaced by Cardinal Domenico Calcagno, his successor as head of the APSA. The decision was clearly to avoid a conflict of interest, but it was nevertheless criticized.

In the Holy See Press Office Bollettino that broke the news about the issuing of the new AIF statute, it was also announced that the professional services agency Ernst & Young was being hired by the Vatican City State Governorate as a consultant. According to the Bollettino, the choice was made after a «procedure of selection, » but this note cannot dispel the shadow of a conflict of interest, since Francesca Immacolata Chaouqui, one of the members of the commission that Pope Francis appointed to rationalize expenses and functions in the 37 Vatican offices, works for Ernst & Young.

Are external consultants really able to understand the Vatican’s peculiarities? The progression of the money laundering law proved that, ultimately, only institutional decisions taken within the walls of the Vatican succeed in projecting the Vatican forward to face new challenges in the world.

The experts of the Promontory Financial Group, retained by the IOR to screen its accounts, are doing nothing more that carrying out what the IOR was already doing. MONEYVAL’s report praised the IOR’s commitment, welcomed the Institute guidelines to apply international transparency standards, and underscored (in paragraph 476) that «the IOR launched a process of client  database review and update in November 2010. The IOR demonstrated a clear commitment and dedication to complete this process by the end of 2012. Six persons are involved in this project and are actively approaching clients to receive updated information.»

Some complaints are already percolating inside the Vatican Walls. It is rumored that the hiring of the Promontory Financial Group has been particularly expensive, although it is not known how much it is actually costing. It would also be interesting to know how much the Vatican is spending to have the Spanish bank Grupo Santander (whose representative in Italy is Ettore Gotti Tedeschi, former president of the IOR Council of Superintendency until he got a no confidence vote) to counsel the Prefecture for the Economic Affairs of the Holy See.

While nothing is known about these costs, there is a downsizing of the Vatican dicasteries’ personnel taking place. It has been explained as a response to a needed austerity and spending review. Five people have been reportedly removed from the Congregation for the Clergy, and it is rumored there is a list of 30 people in the various Vatican dicasteries ready to leave, some of them recalled by their dioceses but others sent back by initiative of the dicasteries themselves. This list would have been put together at the request of Cardinal Giuseppe Bertello, President of the Vatican City State Governorate and, it seems, a veritable deus ex machina inside the Vatican.

Reasons for downsizing the Curia would be part of a wider project of reform. Instead of sending Vatican officials around the world to report back any problems, the Vatican Congregations would be asking the countries’ conferences of bishops to report any problems, leaving them the possibility to take decisions and thus making Roman central power gradually less important. Pope Francis’ reform is intended to give more power to the «peripheries». In the meantime, in the very center of the «empire», there is a risk of a multiplication of small conflicts of interest that would damage the Holy See’s reputation. Consultants are external, with a finite commitment defined in contracts subject to expiration and early termination. The mandates of the commissions appointed by Pope Francis are also limited in time.  Is it truly a good idea to base the reform of the Curia on the advice of outsiders? Is outsourcing in the Vatican really the solution?

The next consistory (the official ceremony where the selection of new Cardinals is confirmed) will be a good test. The consistory will take place Feb. 22, while a meeting of the Council of Eight cardinals will be held on Feb. 17-18 and the Council of the Synod will meet on Feb. 24. Altogether, there will be about 15 days of consultations of cardinals, taking into account that a meeting of the council of cardinals for economic and managerial affairs of the Holy See (the so-called Council of Fifteen) will be held in February, the week before the meeting of the Council of Eight.

A Vatican official told Mondayvatican Oct. 30: «More than a consistory for the creation of new cardinals, I have the impression that this will be mostly a sort of synod of cardinals. It will represent a new way to offer advice, with cardinals from all over the world, giving everybody the opportunity to share their opinions. It will be something very similar to the CELAM assembly, which the cardinals in the group of eight have clearly said inspired their thinking about a reform of the synod of bishops.»

Cardinal Maradiaga is the coordinator of the group of eight cardinals, while Errazuiz Ossa is one of its most influential members. With more frequency in recent times, Maradiaga has expanded on his ideas about the Curia reform. He has also raised the reform of the IOR (the Institute for Religious Works, the so-called Vatican bank), although it is not part of the curia reform. He has shared with the media many details about what he thinks these reforms should entail.

That of the Congregation for the Laity is his most recent proposal, and some Canon law experts, as well as committed layman in the Catholic Church, have received the idea with skepticism.

In the Roman Curia, there are two different kinds of departments (a.k.a. dicasteries): the Congregations and the Pontifical Councils. While the Congregations have executive powers, the Pontifical Councils do not, and are more in the background. Broadly speaking, Congregations are part of the Church’s government, while the Pontifical Council are about the presence of the Church in the world.

A possible streamlining of the Curia has been widely discussed. It seems that Benedict XVI wanted to consolidate the responsibilities of different pontifical councils. This is the reason why one of his fist moves was to make the Pontifical Council for Interreligious Dialogue part of the Pontifical Council for Culture. At the same time, he left for some time the Pontifical Council for Justice and Peace and that for the Pontifical Council for Migrants under the same president.

Internal pressures and opposition, the need to find a balance between his men and the «system», and the Curia’s very strong old guard headed by the former Secretary of State Angelo Sodano (still very influential, also with the press) led Benedict XVI to renounce to redesigning the Curia.

Realizing that an overall reform would take too long, Benedict XVI opted for a different approach, one attracting less attention but even more challenging: to anchor everything strongly on Doctrine,  develop a solid juridical-legal framework, and to aim for a change in attitudes.

Benedict XVI implemented the reform of the criteria of admission to seminaries; the global reform of Vatican finances; the reform of the Penal Code, which has gone into effect under Pope Francis; the new constitution of Caritas Internationalis; the motu proprio about Catholic charities; and the reform of discipline in seminaries, which are now under the administration of the Congregation for the Clergy.

Pope Francis’ project seems to be of a different kind. More than consolidating pontifical councils and thus streamlining the «consultative» dicasteries, it seems that he aims at integrating the pontifical councils within the congregations, even by elevating some pontifical councils to the rank of congregation. It is rumored that the confirmation of the leadership of some Vatican dicasteries in their posts, until the expiration of their mandates, supports this hypothesis. This is the case, for example, with the Pontifical Council for Justice and Peace, which could become a Congregation encompassing the Pontifical Council for the Family, Migrants, and the Laity.

A Congregation for the Laity (which in Maradiaga’s vision would encompass the Pontifical Council for the Family, the Pontifical Academy for life, and the current Pontifical Council for the Laity) is a brand new proposal.

Commenting on it, an official of one of the dicasteries that would be interested in this possible reform told Mondyavatican that «this proposal would in fact ‘clericalize’ these dicasteries.»  A Congregation for the Laity, he adds, «would put issues relating to the family and the laity under one of the Roman Curia’s strongest type of structure. The members of congregations and pontifical councils are cardinals and bishops, rarely laymen. But giving the laity a congregation does not mean give laymen more importance within the ranks of the Church. More likely, it is about about putting the laity under one umbrella.»

The same official underscores that «lay people are very important within the ranks of dicasteries, where they oversee key portfolios and hold posts at the highest levels. Should there be a (political) will to expand the role of laymen, more of them should, above all, be made members of congregations and councils, and not just consultants in them.»

In fact, Pastor Bonus states that «the dicasteries are composed of the cardinal prefect or the presiding archbishop, a body of cardinals and of some bishops, assisted by a secretary, consultors, senior administrators, and a suitable number of officials»  (art. 3).  It also foresees that, «according to the specific nature of certain dicasteries, clerics and other faithful can be added to the body of cardinals and bishops.»

Pastor Bonus can obviously be changed. But there would also be a need to change Canon Law, which establishes that some posts are reserved for clergy only.

A brand new Pastoral Constitution to replace Pastor Bonus is in fact what the group of eight cardinals is thinking about. At the same time, Archbishop José Carballo, Secretary of the Congregation for Institutes of Consecrated Life and Societies of Apostolic Life, has spoken about the possibility of reforming Canon Law. Taking the floor Oct. 29 at a conference about vocational perseverance, and speaking about religious brothers and sisters abandoning consecrated life, Carballo asserted that «there seems to be a need for a specific path for each novice,»  and also «a novitiate longer than what is contemplated in Canon Law,» to allow for better discernment.

According to canon 648 of the Code of Canon Law, the novitiate must last from a minimum of 12 months to a maximum of 2 years.

A reform of the Code could be an option, because Canon Law «is not the Gospel, it is written by men,»  Carballo said. At that point, Cardinal Joao Braz de Aviz, Prefect of the Congregation, commented: «That is what Pope Francis told us.» In a conversation after his remarks, Carballo told the author of this blog that «a reform of Canon Law should not only be about the novitiate, it could also be more comprehensive.»

In fact, no reform of the Code of Canon Law is expected at this time. Perhaps in the more distance future. The new code of Canon Law was issued in 1981 after decades of work. It took 16 years to draft «Pastor Bonus»  – which was mostly a realigning of the Curia more than a revolution. The reform of the Synod of Bishops will also take some time, which is the reason why the minor adjustments of every synod are portrayed as exceptions – not changes – to the norm.

The general impression is that we are at the stage of general consultations, more or less open. The group of eight cardinals will meet Dec. 3-5, and it is possible that in February there will be a broader consultation of cardinals, maybe extending it to the members of the General Secretariat of the synod. Paul VI even thought about having the members of the General Secretary of the Synod participate in conclaves. He was dissuaded from doing so, Benny Lai reported, by Cardinal Giuseppe Siri, who thought that the members of the General Secretary of the Synod could be influenced by others. 

That of February may be a sort of mini informal council, partly corresponding to the notion of the permanent assembly that Pope Francis wishes for the Church. This sort of a reform of synodality, a concept close to the Pope’s heart.

John Finnis had the courage to go beyond this instructions book. A legal positivist in the past, he then changed his point of view – he also converted to Catholicism -, and looked beyond the written «one way» history often taught in schools. He decided to identify, as the founder of modern thought, a theologian — a Dominican friar whose philosophic vision cannot stand without his faith.

How many «John Finnis» are in the world? A lot, indeed. There are those who studythe history of human rights and reveal they did not rise with Enlightenment and legal positivism, but much earlier, with the Salamanca Dominican School and the report of the Indias by Bartolomé de Las Casas. There are those who study the history of the law, and show that, yes, the Inquisition degenerated horribly, but the reason why it came into being was to reform judicial procedures, and to institute a person-centered trial. Before, accused persons had to defend themselves from any given accusation.  In the Inquisition’s trials, the accused is presumed innocent until proven guilty.

There is a whole visible – and yet hidden – world delineating the contours of a culture directly rooted in Catholicism.A world that Catholic-inspired institutions should call our attention to. Recently, much has been written and said about Benedict XVI’s Twitter account. A really big deal? Not at all. In fact – as father Antonio Spadaro, director of the Jesuit bi-monthly Civiltà Cattolica, rightly put it – Benedict XVI’s twitter account is a direct consequence of the radio messages inaugurated by Pope Pius XI.  Radio messages that, with Pius XII during the Second World War, acquired the very force of a social encyclical.

The issue is not about having a Twitter account or not, or about reaching out to bloggers – as the Vatican did in a Meeting for Bloggers held the day after John Paul II’s beatification. The issue is not even the need to have a portal like news.va, a news aggregator which also works as a Vatican official channel for news. All of this is important, but it is just cosmetic. And the way it is managed can serve to increase visibility, but fails in delivering content, which is most important. It seems it was a long time ago that Pope Pius XI, conscious of the importance of the Church’s message, hired Guglielmo Marconi to build and start the Vatican Radio.

But many – inside the Holy See – are not fully aware of the value of the message that they have a role in transmitting.  They are not conscious of the importance to tell and communicate that message. This is ultimately the reason why there is little coverage of the lively Catholicism of parishes, and why Catholic culture and transmitting the Church’s history are not supported. Much should be rewritten in history books, to show the role of Catholicism in the world. But the Catholic intelligentsia seems not to be conscious of it. It is so unconscious about it that – for example – the administration of seminaries is transferred to the Congregation for the Clergy and taken away from the Congregation for Catholic Education– despite the fact that the latter provided a comprehensive education, not just one for sacristies.

Catholic thought is now spread thanks to some small initiatives. Far from being just “local”, these initiatives can be considered small flowers that blossom in the desert.They need to be fully appreciated. In Italy, there are at least two noteworthy examples.

The Circolo San Tommaso d’Aquino is a cultural association of young people and for young people, founded in Aquino – the birth place of Thomas Aquinas – in 2009. It publishes I Quaderni Aquinati, book series, which most recent additionis Thomas Aquinas’ Integral Humanism, by the philosopher Massimo Cacciari, the theologian Inos Biffi, and Card. Gianfranco Ravasi, president of Pontifical Council for Culture.  The mission of the Circolo San Tommaso d’Aquino is to spread Thomas Aquinas’ thoughts and works. This is why every year it promotes an International competition – called Veritas et Amor – awarding two 3,000 euro scholarships to scholars up to 35 years old: the first scholarship is for a paper or thesis that updates the relevance of Thomas Aquinas thought – not only regarding theological issues, but also diplomatic, political and social issues; the second scholarship is awarded to an art work inspired by Thomas Aquinas’ writings. All of the Circolo San Tommaso initiatives have been inspired by what Paul VI said when he visited Aquino in 1974 to celebrate the 700 anniversary of Aquinas’ death. On that occasion, Paul VI spoke off the cuff. The Circolo found the recording of that speech and published it in a Dvd. «Where, if not in Aquino – Paul VI said – can anyone study theology?»

The Cardinal Michele Giordano Prize (in memory of cardinal Michele Giordano) has been sponsored by L’Orientale Editrice publishing house. Established in memory of the mourned archbishop of Naples (he died in 2010), the prize recognizes a book of religious interest published in 2012 (a commission will choose three finalists, and the winner will be elected via a facebook vote), thus stimulating and rewarding Catholic publishing. The prize was inspired by Cardinal Giordano’s keen appreciation for the media. As archbishop of Naples, he came up with the “Premio Buone Notizie” (good news prize), which he awarded to prominent journalists.

The development and promotion of Catholic culture is linked to initiatives like the ones promoted by Circolo San Tommaso e L’Orientale Editrice. The Catholic world lacks organizations with open-minded criteria, institutionally supported, that can invest on these initiatives and help to promote Catholic thought. Institutional coordination is also lacking. This coordination could be managed by the Pontifical Council for Social Communications, so that every initiative, even small ones, be assessed and appreciatedat the international level. And so, there is still a visible, yet hidden, Church. Individual initiatives are the engine that supports the history, thought and life of the Church. Yes, this is subsidiarity – i.e., if a single, a small community can do something, the central institution must not interfere – a cardinal principle of the Social Teaching of the Church. However, subsidiarity also needs support from the top-levels. And this support cannot always be just a sponsorship