And he is doing it stepping on and continuing the path initiated by Benedict XVI. Since the Holy See committed to the path to financial transparency, the pace has been sometimes slowed down. The first anti-money laundering law, drafted by Marcello Condemi – one of the former members of the AIF’s board – had been almost completely a copy of the Italian anti-money laundering law — which itself had not been positively assessed by international bodies. The reform of the law, solicited by the Council of Europe MONEYVAL committee, put the Holy See on the right track.

Since the 25 January 2012 reform of the law, the Holy See’s path toward financial transparency has been ever more geared toward an international framework, beyond the possible “good neighbors” relations  that could have been established with any given country.

In December 2012, two modifications to the Vatican anti-money laundering law permitted the AIF to sign memoranda of understanding with its counterparts without the requirement of a “nihil obstat” from the Secretariat of State. Later, the reform of the Vatican penal code, the 8 August 2013 Motu Proprio issued by Pope Francis which became law on 8 October 2013, delineated a specific Vatican financial system with a Committee for Financial Security, and entrusted the AIF with prudential supervision. In November 2013, the Statute of the authority was reformed, its powers strengthened: an office for prudential supervision was established, the tasks of the board were clearly delineated, and the board was described as a body that sets the strategic goals for the Authority.

After the appointment of Bishop Giorgio Corbellini as ad interim president of the Authority, a change in the membership of the Council was natural, in order to give the board the required international profile.

Corbellini replaced Cardinal Attilio Nicora, the ‘creator’ and head of the Financial Information Authority since it was established. Nicora resigned due to age limits.  Earlier, he had been obliged to leave the post of President of the Administration of the Patrimony of the Holy See, because it was incompatible with the post of director of the financial watchdog. Nicora’s conflict of interest had been noted in the July 2012 MONEYVAL report, even if not by name.

Giuseppe Dalla Torre was also in a potential conflict of interests situation, because he was both a member of the AIF board and President of the Vatican Court: the AIF submits to the Vatican general prosecutor cases of suspect transactions for further investigation.

Other members of the board were Marcello Condemi, one of the drafters of the first Vatican anti-money-laundering law; Cesare Testa; Claudio Bianchi; and Francesco De Pasquale, a law expert who had been director of the authority until he was elevated to the rank of member of the board when René Bruelhart took over the post of director.

The former AIF board is replaced by four high profile international experts.  They are:

Marc Odendall, a financial consultant in the philanthropic sector, from Switzerland. He is in the board of the Caritas in Veritate Foundation, chaired by Archbishop Silvano Maria Tommasi, the Holy See Permanent Observer to the UN Office in Geneva. The Foundation engages the United Nations to elevate the international profile to issues of concern to Catholics. Odenall worked for JP Morgan during the 80s and for Merrill Lynch in the nineties. He is married and is the father of four children.

Joseph Yuvaraj Pillay, president of the Council of Consultors of the President of Singapore, was Managing Director of the Monetary Authority of Singapore and of the Investment Corporation of the government of Singapore from 1985 to 1989. He has also been president of Singapore Airlines and of the Development Bank of Singapore. The University of Singapore vested him with an honoris causa in law qualification in 1996.

Juan Zarate, senior advisor at the Center for Strategic and International Studies and Harvard professor of law. He was George W. Bush advisor for combating terrorism. He worked as U.S. Assistant Secretary of the Treasury for Terrorist Financing and Financial Crimes, combating the financing of terrorism, and he is an expert in combatting money laundering. He led the hunt for Saddam Hussein’s assets, recovering more than 3 billion dollars. He studied at the Catholic School Mater Dei in Santa Ana (California), where he grew up. He has been inducted in his school’s Hall of Fame.

The only Italian member of the new AIF board is Bianca Maria Farina, managing director of the Italian insurance companies Poste Vita and Poste Assicurazioni. She has always worked in the financial and insurance sector, where she has held important positions. She was part of the privatization of the Italian public insurance company INA Assitalia. After just a few years, she positioned Poste Vita as a leading company in the savings and social security sector in Italy. She is also vice-president of the National Association for Insurance Companies, a member of the Board of Directors of the Federation of Banks, and an advisor to «Save the Children».

In addition to the new board, the new position of Deputy Director of the AIF has also been filled. The post was inserted in the new AIF statute, to assist the director in controlling the AIF operational activity. The Secretary of State – who controls the appointment – chose Tommaso Di Ruzza, confirming the new international focus of the Holy See. Graduated in Law by the University of Siena and specialized in International Law at Oxford (UK), Di Ruzza has been a legal officer of the Holy See since 2005 and, since 2011, in charge of the AIF’s juridical and international issues. He is among the main drafters of the Holy See enhancements on financial matters to adhere to international standards. He oversaw some of the negotiations regarding MONEYVAL and the Egmont group (a forum which brings together the financial information units of many countries).

Six new memoranda of understanding have been announced just two days after the appointment of the new AIF board, confirming the Holy See’s international vocation. In Lima, while taking part to the plenary meeting of the Egmont Group, the Financial Information Authority signed memoranda of understanding with the UK, France, Malta, Peru, Poland and Romania. The new memoranda are in addition to the twenty-some previously signed, the most important being those with the U.S., Germany and Italy counterparts.

Now, the framework for the Vatican’s Financial Information Authority international cooperation is broader, involving other key countries in financial matters, like the UK and France. 

(Note: Vatican City State is a sovereign territory in the heart of Rome.  The Holy See is an equally sovereign and internationally recognized legal entity charged with the governance of the universal Catholic Church. Vatican City State provides the Holy See a base to facilitate and support the apostolic mission of the Church.  «Vatican official» is used to refer to Holy See or to Vatican City State officials.  End note.)

This reform strengthens the weight of the Holy See in the international arena. Supported by a modern State with modern laws (often Vatican laws surpass those of secular states), the Holy See’s credibility, importance and influenced is enhanced. Ultimately, «no State is an island» and «States are in continuous renewal to be in step with the times, » Giuseppe Dalla Torre, President of the Vatican City State Tribunal, explained.

So, through three laws, Vatican City State made its legal system more complete. It eliminated the possibility of life imprisonment as a sentence, an issue which is currently at the center of an important debate in Europe. It inserted in its legislation punishment for crimes against minors. It strengthened the penalties for money-laundering and corruption. All of these activities were considered crimes even before the reform. The reform makes their definition as crimes more specific.

There is more. The three laws are accompanied by a Papal motu proprio that extends these norms to the Holy See. Thus, the new legislation not only applies to all the employees and officials of the  Roman Curia: It also applies to Papal nuncios and Holy See diplomats, and to the employees of bodies or institutions linked to the Holy See, whether they happen to be located in Vatican City State territory or not.

It is not the first time that certain aspects of the Vatican’s legal code are extended to the Holy See. A precedent was the motu proprio released in 2010 together with the anti money-laundering law.

Does this undermine Canon Law, truly the fundamental law of the Holy See? Some believe it does. Dalla Torre explained that in fact it is simply a mandate the Vatican Tribunal is given to prosecute, in certain specific cases, some of the crimes that have occurred in Holy See environments. The mandate, ultimately, is given by the Pope, who heads both Vatican City State and the Holy See.

Mainstream media have emphasized the codification of crimes against minors, interpreting it as a commitment to combat pedophilia by priests. In fact, these crimes became part of Vatican law pursuant to the Holy See’s signature and ratification of several international conventions. Ultimately, the Holy See followed the regular procedure: after committing to certain principles under a convention, the penal legislation is adjusted to apply those principles.

The Vatican legal code dates back to 1929. In 1969, Paul VI made some modifications to update its penal legislation. However, they did not made the Vatican penal legislation applicable beyond Vatican territory.

Dominique Mamberti, the Vatican’s Secretary of Relations with States, noted in an article on the Vatican daily newspaper L’Osservatore Romano that Vatican City State at its birth «completely adopted Italian legislation, both the civil and penal codes.» Mamberti explained that this was thought «sufficient to regulate common law within a State which raison d’etre lies in supporting the spiritual mission of the successor of Peter. »

Obviously, it is not sufficient any more, for different reasons: the Vatican borders are within Europe; the world has experienced globalization; and the Holy See has signed international conventions obliging it to adapt its legislation to fulfill these treaties’ commitments, just like any other State.

This is why Benedict XVI began a judicial overhaul of Vatican City State.

One of the first turning points, and milestones, was the 2010 anti money-laundering law. The law is in abidance with the monetary convention the Holy See signed with the European Union in 2009. Through that convention, the Holy See became part of the euro zone, albeit not being part of the European Union.

The anti money-laundering law is a concrete sign that the Vatican’s borders are now with Europe. This turning point certainly disappoints those who were used to a privileged, bilateral relation between Italy and the Vatican. This turning point marks an assertive presence of the Vatican in the multilateral arena of international regimes.

The Holy See is thus strengthened in its international relations, making the smallest State of the world one of the most active as measured by the number and importance of formal diplomatic relations it maintains.

This has allowed the Holy See to meet international standards without losing its sovereignty and specificity. For example, the anti money-laundering law has been  improved, and Dalla Torre – in a media briefing on July 10 – announced there will be more news in September.

A complete overhaul of the Vatican financial system can be expected, given the Vatican’s decision to report to the Council of Europe MONEYVAL evaluators progress on a wide range of recommendations, beyond what regular procedures require.

It is noteworthy that the first revision of the anti money-laundering law was issued together with the signature or ratification of some international conventions. In fact, the Holy See’s goal is to earn the international community’s recognition and appreciation for these measures, instead of opting for very limited change and using it as a «fig leaf» to cover underlining problems.

Conventions also were the «engine» propelling the codification of particular cases of crimes in the Vatican penal system, on issues ranging from torture to crimes against humanity, pedophile pornography, corruption, and corporate legal responsibility standing side by side to personal legal responsibility.

This is the big revolution that Benedict XVI started. It does not grab newspapers headlines. It does tell, however, that the Vatican is enhancing its legal code, building a sound juridical structure, and exercising its own sovereignty to become more open to the world.  The MONEYVAL evaluation process represented a first push in this direction, but certainly not the only one or even the most important one.

Benedict XVI initiated other reforms. For example, the new constitution of Caritas Internationalis, which filled with juridical substance one of the most important international structures of the Church.

What we heard  during the very short trial that took place in Vatican City State last week showed how dangerous and careless it was to hire Paolo Gabriele for such a sensitive position. Recommended by Stanislao Dziwisz – now cardinal and archbishop of Cracow, previously John Paul II’s secretary – and by msgr. James Harvey – once assessor in the Vatican Secretariat of State and now prefect of the Pontifical House – Paolo Gabriele perfected over the years his knack for copying and stealing documents.  His version of events – that he began to gather documents in 2010, when the «Viganò’s affair» became public – contradicts the investigation’s findings. Georg Gaesnwein, Benedict XVI’s personal secretary, examined the papers. He noted that there were documents from 2006, 2007, 2008 and 2009. In their testimonies, the Vatican Gendarmes who searched Paolo Gabriele’s house confirmed that there were several documents taken before 2010. The Pope’s butler also maintained that he only took copies of documents. Facts denied it: there were several original documents in his house –everyone testifying  coincided on this.

Paolo Gabriele is not a scapegoat. He is certainly someone easy to take advantage of. It is so stated in both psychiatric examinations (the one requested by Paolo Gabriele’s lawyer and the one requested by the Vatican Promoter of Justice during the preliminary investigation) undertaken to analyze whether Paolo Gabriele was insano de mente or not. The butler knows and weighs the consequences of his actions. Yet in the psychiatric examination, Paolo Gabriele’s profile is that of an insecure person with a constant urge to meet with the approval of people he considered of a certain importance. During his testimony, Paolo Gabriele told how he used to take the car to go to work everyday, a mere 3-4 minutes commute on foot. Otherwise, he said, everybody could stop him to ask for favors, and he – being a good Christian – could not help but to listen and try to help everyone. Perhaps he took the car only to better hide the documents he stole.

When questioned, Paolo Gabriele almost brags. He says that he copied documents in front of everyone in his office – he had a desk in the room of the two Papal personal secretaries – because nobody would suspect him, since his intentions «were not evil». He explains that he «opened his heart» to Msgr. Gaenswein about his fears regarding the Vatican Gendarmes Corps. In fact, he has a sort of obsession with the Vatican Gendarmes. Somebody noted that it is the fixation of a person who could not become a Gendarme. Paolo Gabriele asks Gendarmes for copies of their regulations, he researches information about the Vatican Gendarme Corps, he reaches out to a certain Luca Catano – whom he though to be a magistrate – thinking he could get more information through him.

But the game Paolo Gabriele played during the trial is very odd. When he was held in custody, his lawyers declared that he was well and psychologically healthy. During the trial, he played the «torture card». Paolo Gabriele maintains that he was imprisoned for 20 days in a tiny cell, so narrow that he could not stretch his arms. He maintains that the light of his cell was kept on 24 hours a day. Giuseppe Della Torre, president of the Vatican Tribunal, opens an investigation about this «tortures». Members of the Vatican Gendarmes Corps are shocked. They treated Paolo Gabriele with kid gloves, and the butler had even thanked them. They deliver a press communiqué, responding point by point to each of Gabriele’s accusations. They counter the possibility of facing further accusations. The day after Paolo Gabriele’s interrogation, Vice Commissioner Cintia was called to testify, and asked that the court record note that «Paolo Gabriele thanked me». To which Paolo Gabriele reacts with a wide smile.

Paolo Gabriele’s defensive line is also questionable. It intends to show that the Pope’s butler was framed. His lawyer Arru insistently raised questions: about the use or not use of gloves during the search in his house (although for «paper searches there is no need for gloves»), about the search in Gabriele’s house in Castel Gandolfo, in Italian territory (although this search is not part of the trial); about the fact that the boxes where all of Paolo Gabriele’s things were placed were perhaps too large, insinuating there were originally more documents than those later considered necessary.  All this calling into question is to support the scapegoat thesis, where Paolo is the victim to a conspiracy. He is the hero framed, who takes the blame calmly.

Paolo Gabriele is not a hero. He is just one of many Vatican employees. Many of them handle documents. Not all of them steal documents. Many of them can have questions about situations, even be shocked. But they try to be loyal to the institution they have been sworn into. It is also true that others would do what Paolo Gabriele did, maybe to earn some extra-money, or for other reasons. There is, in fact, a «gang of malcontents», a sort of group made up of Vatican clerks and prelates. They do not hide their discontent, and they often speak about how to «help the Pope», which means to stir trouble for the Pope.

The existence of this gang of malcontents proves that the Vatican old boys’ club system has failed. Over the years, clerks, officials and even priests poorly selected were hired in the Vatican, and then have been able to advance in their careers, step by step. Mediocre people were able to reach very senior posts, and then co-opted people similar to them. There are almost three such generations. The Vatican must really overhaul its hiring practices.

Gabriele has even mentioned an enabling environment. Who swayed Paolo Gabriele? He talks about cardinals Sardi and Comastri; about Joseph Ratzinger’s long-term collaborator Ingrid Stampa; about Msgr. Cavina, bishop of Carpi, who served for a long time as an official in the Vatican Secretariat of State. The first three – together with Joseph Clemens, whom Paolo Gabriele oddly did not mention – were said to be the Vatileaks inspirers in an article in Die Welt which influenced public opinion (this article was excerpted from the trial, on Paolo Gabriele’s lawyer request). This article – whose contents were officially denied by the Vatican Secretariat of State – was excluded from the process on request by Paolo Gabriele’s lawyer. The butler drops these names, and then distance himself from the consequences. The day after giving testimony, Cristiana Arru maintains that the butler is «bothered» by the fact that the media has referred to these people as his accomplices.

Perhaps, one should look for Paolo Gabriele’s enabling environments elsewhere. Much higher, and also in everyday meeting places. Perhaps in some of the bars around the Vatican where the gang of malcontents gather to complain, and where a cardinal could casually pat someone on the shoulder and let him know that he can be a hero, that he can play a role to save the Pope from his obtuse collaborators. Who seduced Paolo Gabriele? Who had reasons to do so? Many are those who may have a grudge against this Pontificate, and against Bertone, Secretary of State. After almost 30 years, the machine of privileges was dismantled by the Pope and Bertone. They re-built the structures, and gave power to other people.

Once, these internal struggles took place inside the Vatican, invisible outside the Sacred Walls. The loyalty to the institution came above all. There was great consciousness about the importance of the Church in the world. That is no longer the case.

Vatileaks shed light on how prelates often put their personal interests before the Church’s interests. The sense of being Church has been lost. Careerism has grown – and it is not a case that the Pope held several speeches and homily blaming careerism. Much could be learned from the report of the cardinals’ commission appointed by the Pope to investigate how the documents were leaked. The three cardinals –Herranz, Tomko and De Giorgi—looked into the «enabling environment». They reached some conclusions, which they shared personally with the Pope. The issue is not whether someone would like to see Pope Benedict XVI killed or marginalized. The real problem is indifference toward the Church. The scant understanding of its mission, reducing it to a mere power structure. This is why Vatileaks is not over.  It may never be.

This last has been a sort of polar star for Benedict XVI. It was precisely on Saint Bonaventure’s theology of history that the young Joseph Ratzinger published, in 1959, his thesis for certification to teach theology. The novelty of this early text was that it compared, for the first time, Saint Bonaventure’s theology of history with the highly influential version of Joachim of Fiore.

Bonaventure – Benedict XVI said in the 10 march 2010 general audience – addressed the problem of the influence of Joachim Fiore,  who  affirmed – according to the Trinitarian rythm of the history he outlined – that the third age, that of the Holy Spirit, was up to come, and that the arousal of this new time would come from a new monasticism.  Joachim of Fiore affirmed that St. Francis and the new community he created, so different from the monasticism known up to then, called for a new interpretation.  Bonaventure understood that there was the practical need to embody Joachim of Fiore ideas  in the reality of the hierarchical Church,  and this had to be done on the basis of a theoligical foundation. He also knew that – although taking into account the necessary realism – it was not necessary to lose the novelty of St. Francis.

This is the reason why Bonaventure harmonized the positions. He remembered that Jesus Christ  is the last word of God: in him God has said all, giving and expressing himself. At the same, Bonaventure underlined that  Church is not immobile, fixed in the past and that novelties cannot be exercised in her. «Opera Christi non deficiunt, sed proficiunt», the works of Christ do not go backward, do not fail, but progress, says the saint in the letter De tribus quaestionibus. Christ is not the end of history. He is the center of history.

Bonaventure’s harmonization method  is at the basis of Joseph Ratzinger’s method. This was precisely the reason why the Papal pastoral visit  of yesterday to Arezzo, Sansepolcro  and La Verna – where in fact Benedict XVI could not go because fog and  bad weather  made the trip impossible – the Pope would have read a passage of the Itinerarium Mentis in Deum of Saint Bonaventure.

The one-thousandth anniversary of San Sepolcro – the first town founded on the basis of a theological project – has been celebrated by Benedict XVI his way. He affirmed that «today there is a peculiar need that the service of the Church to world is made up by enlighted lay, able to operate within the City of Man, willing to serve looking beyond  the private interests and the interests of only one part», and invited people to rediscover Christian roots.

And there it comes the Benedictin spirit of the Pope. When Joseph Cardinal Ratzinger took the name Benedict XVI in late April, observers immediately speculated as to what it meant. Although Benedict XVI has pointed to his desire to carry on the legacy of Pope Benedict XV (1914—22) as a primary reason behind the name, his choice of Benedict naturally called to mind St. Benedict of Nursia (c. 480—547), by far the most important figure in the history of Western monasticism. Some have said that just as St. Benedict and his monks rescued Europe during a time of general collapse, Pope Benedict hopes to rejuvenate a Europe adrift from its moorings, overcome by relativism, and unwilling even to reproduce itself.

Although many people know that St. Benedict’s monks were responsible for preserving much of the literature of the ancient world, that is where their knowledge of the subject ends. But the more familiar we are with the monastic tradition and its essential if largely unknown contributions to the West, the easier it is to understand why St. Benedict has vied with Charlemagne for the title of Father of Europe.

In the speech at College of Bernardins, the Pope explained that «it is through the search for God that the secular sciences take on their importance, sciences which show us the path towards language.  Because the search for God required the culture of the word, it was appropriate that the monastery should have a library, pointing out pathways to the word.  It was also appropriate to have a school, in which these pathways could be opened up».  Benedict called the monastery a dominici servitii schola.  «The monastery – he explained – serves eruditio, the formation and education of man – a formation whose ultimate aim is that man should learn how to serve God.  But it also includes the formation of reason – education – through which man learns to perceive, in the midst of words, the Word itself». But there is also the need for a further step. «The Word which opens the path of that search – the Pope said – and is to be identified with this path, is a shared word.  True, it pierces every individual to the heart (cf. Acts2:37).  Gregory the Great describes this a sharp stabbing pain, which tears open our sleeping soul and awakens us, making us attentive to the essential reality, to God (cf. Leclercq, p. 35).  But in the process, it also makes us attentive to one another.  The word does not lead to a purely individual path of mystical immersion, but to the pilgrim fellowship of faith».

And there it comes the character of Gregory the Great. His search for God brought him to strongly reform the Church. That of Gregorian reform is an heroic enterprise, brought on by a few man that works to re-moralized their society and so purify the Church. People gathered around Ildebrando of Soana begins a movement whose effect were so vast that a whole world change. Will this happen with the Benedict XVI’s Papacy?

Elected Pope with the name of Gregory VII, Ildebrando did not only care about the purification and moralization of the Church. He also began a movement to collect ancient sources, so creating a corpus of papers that will be the first global law of the world, the Canon Law. Gregory also defended the autonomy of the Church – its power standing upon any other power -, and  organized the Pontifical Legates network. He established two kind of Pontifical Legates: the one in loco, charged by the Pope to look after the application of Gregorian reform on a territory; and the one sent by  Rome to accomplish mission in a foreign countries. In some ways, Benedict XVI is changing the way Vatican diplomacy is ruled: he appointed Charles J. Brown, a non-diplomat that served in the Congregation for the Doctrine of the Faith, as Papal nuncio to Ireland; and even Tarcisio Bertone, secretary of State, is not a career diplomat, but a canonist that wants to be considered a Secretary of Church, more than of State.

Benedict, Bonaventure, Gregory VII: Benedict XVI’s pontificate is articulated through this three monastic characters. More: it is articulated on quaerere Deum. And this search for God is intended to have a less worldly Church, and to bring it back to God. The climax of Benedict XVI’s Pontificate will surely be the Year of Faith, and the Credo that will conclude it in every diocese of the world.

After adopting the new law, the Holy See began a complex path to adequate to the international standard, according to GAFI (Financial Action Task Force) recommendations. This path would finally lead the Holy See to be enrolled in the «White List», the list of states most active in preventing and fighting the financial crimes.. In november, advisors of the Council of Europe made an on-the-spot investigation in Vatican. The news was not widely covered by the medias, and it did not seem to interest analysts and public opinion.

Still, the motu proprio delivered one year ago signed the change of an era. Before it, Vatican did not have an Authority of Financial Information. Before it, Vatican boundaries were just with Italy, and monetary agreements were to be signed just with Italy. Vatican Lira (the coin issuanced before euro) was not the international lira, but Italian lira. The entrance in the European Union changed everything. The changes did not deal just with the Vatican. But the changes dealing with the Vatican had been widely covered by medias, mainly focusing on the I.O.R. issue. This interest letted show – according to some Vatican insiders – other kind of goals, as – for example – the attack to the sovereignty of Vatican City State, in order to undermine the diplomatic importance of the Holy See.

Let us make a step back in time. February 2009: European Commission communicates that the Monetary Agreements with Monaco, San Marino and the Vatican are to be reviewed. If the three countries wants to remain hooked to the European Monetary System, they need to uniform to European norms and procedures, peculiarly for what concerns the countering of money laundering and of financial aids to terrorism.  The European Commission also asked to introduce a new uniform method for calculating the ceilings of euro coins issuance of the three countries and any country that would sign a Monetary Agreement with the Community in the future. In order to reach the objectives of the revisions, ad hoc bilateral commissions had been established.

Since February 2009, Vatican and European Commission advisors (Italy is part of the table as observer) start up the job to define the new monetary agreement. European Union conditions immediately seem to restrictive. The relationship between Holy See and European Union are fraught. Vatican has the will to keep its autonomy, and so every single point of the agreement needs to be discussed and weighed up. But time is short. Mons. Carlo Maria Viganò, then secretary of the Governatory of the State of Vatican City, even proposed to unhook Holy See from the Euro area, in order to let the Holy See avoid to be subjected to too restrictive conditions. In some ways, it was a prophetic idea, considering the state-of-the-art of euro area and the choice of some countries – e.g. Great Britain – to keep out from the euro area. Someone also propose not to close the agreement within the year 2009, and to postpone the closure of the agreement to 2010. Hierarchies of the Holy See did not take in consideration both of the hypothesis. The costs would be so high, both for political and economical reasons. A postponing would bring – for example – to a suspension of the coins issuance and stamps issuance, which are among the most important incomes of Vatican City State. It is too complicated.

The monetary agreement is finally signed on December, 17th 2009. It is a day full of tensions. The monetary agreement would be signed contextually by Joaquin Almunia, Europen commissioner for Economical and Monetary Affairs, and mons. André Dupuy, Apostolic Nuncio to the European Union. Almunia refuse to sign the agreement in the same room with the pontifical representant, and so Dupuy and Almunia sign the agreement each one in their own office. Almunia fairly slight the Holy See, also because of the fraught relationships between the Spanish Socialists and Catholic Church. The same Almunia, once he will be appointed as European Commissioner for Concurrency, will start the procedure against the Italian State for favoritism toward the Church because of a special fiscal regime – in fact the fiscal regime enjoyed in Italy by Churches that signed a Concordat with Italian State.
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Inside the Vatican, things goes on quickly, even because time is short. The Vatican Law 127 is adopted and it is decided to extend the effects of the new regulations to the Holy See via a motu proprio by Benedict XVI. The Motu Proprio is released the 30th of December 2010, right in time not to let the agreement lapse. According to some Vatican insiders, the institution of the Authority for Financial Information would mean that the same Ettore Gotti Tedeschi, president of the Commission of Vigilance of the I.O.R., is not given a blank cheque by the Pope, since the I.O.R. itself is subjected to monitoring.

But it is not downhill from there. In September 2010, two money transfers of the I.O.R. are subjected to preventive seizure for a suspected  violations of the norms against money laundering. I.O.R. moved money from an account it owned toward the Credito Artigiano ,a «friend bank», whose president, Antonio De Censi, seated in the Commission of Vigilance of the I.O.R. The I.O.R. ordered Credito Artigiano to make two transfers with the money in that same account: one of 3 million to an account at Banca del Fucino in Rome, and another of 20 million to a JP Morgan account in Frankfurt. Both the account were owned by the I.O.R.

The Banca d’Italia (Bank of Italy) demanded detailed information on the ownership of the accounts of the I.O.R. and the recipients of the transactions, but all the explanations are considered not sufficient. The money are seized, waiting for further investigations. They will be un-seized just when the Vatican counter money laundering regulations has come into effect.

In the meantime, Ettore Gotti Tedeschi – taking an  unprecedent and (according to many insiders) questionable decision – agreed to be questioned by the magistrates of Rome, and is questioned in the offices of the public prosecutor in Rome. His deposition filled 91 pages of transcripts. In it, he explained his action as «a demonstration of the desire to comply with a new era», and he also explained why and how the transfer took places. The magistrates did not deem satisfactory the clarifications given.  Gotti Tedeschi’s deposition created a disagreeable precedent in the diplomatic relationships between Holy See and Italy: if Holy See is a sovereign country, magistrates of a foreign country – Italian ones included – must submit a request internationally,forwarding the request through diplomatic channels to the Holy See as a foreign state, to question one of its employees. More. The president of the body of a country cannot be questioned from a judicial authority of another country but renouncing his immunity. Otherwise, his personal choice would imply to the a de facto demission to the immunity of the body itself. Gotti Tedeschi’s choice is something incomprehensible in terms of international relations.

This is one of the topics in discussion within the Authority for Financial Information, headed by card. Attilio Nicora (former president of the A.P.S.A., a sort of “central bank” of the Vatican) and leaded by a directive council that enlists among his members Giuseppe Dalla Torre, one of the most authoritative and trusted people of the Holy See. Excepted Nicora, Dalla Torre and an internationalist jurist come from other charges within the Holy See, many members of the Authority for Financial Information come from Italian banks and from Bank of Italy, where they were not appointed in important charges. Is the composition of the board coherent with the universality of the Holy See, whose employees are traditionally chose internationally? The imbalance to Italy is considered by many Vatican insiders a sign of weakness and source of risks, more than of opportunity, since the troubles of the Holy See came from a request of the Bank of Italy headed by Mario Draghi (now president of the European Central Bank).

On September, 14th 2011, Holy See delivered to European Union a preliminary paper, in order to illustrate the normative and institutional framework of the Holy See and of Vatican City State, and to explain the initiatives issued to adequate the regulations to the international standards. At the end of November, the advisors of the European Council made an on-the-spot investigation. Contrary to expectations – maybe especially to Bank of Italy’s expectations – it seems that the I.O.R. has been found healthy regarding international standards.

At the half of 2012, MoneyVal – the body of the Council of Europe that ensure that its member states have in place effective systems to counter money laundering and terrorist financing and comply with the relevant international standards in these fields – will discuss the report on the Holy See and on the State of Vatican City. In the meantime, the reformation of Vatican finance is intensively in progress. The game is not yet over, and no one knows how it will end.

On September 6, the I.O.R. ordered Credito Artigiano to make two money transfers from an account of the I.O.R. deposited with the Italian bank: one of 3 million to an account at Banca del Fucino in Rome, and another of 20 million to a JP Morgan account in Frankfurt. Both of the recipients were identified only by their IBAN codes. On September 15, the office of financial information at Bankitalia notified Roman authorities about a possible violation by the IOR of the norms against money laundering. On September 20, the court of Rome ordered the preventive seizure of the entire sum deposited in the account of the IOR, and issued two notices of investigation of the president and director general of the Vatican bank, for omission of procedures against money laundering. The money are frozen, the I.O.R. is in the storm.

One year before, in September 2009, Rome Public Prosecutor investigated on money transfer o fan I.O.R. account deposited with a branch of Unicredit Bank based in via della Conciliazione, close to Saint Peter Church. The investigation led nowhere, but it was a signal that the “bank of the Vatican”, had more difficulties than in the past to make money transfers.

In fact, the I.O.R. is not a “true” bank, and it deposits accounts with branches of several banks all over the world to make money transfers. There are some privileged relationships, e.g. the ones with the Jp Morgan Bank and Unicredit. Since the last investigation, Unicredit strengthen the regulation, and asked to specify in a fairer way from who and why the money are deposited or moved in the account and to clarify even the bank check movements. Is the proverbial Vatican bank privateness going to collapse?

Many worried about the possible collapse of the Vatican privateness when  Ettore Gotti Tedeschi, president of the I.O.R., together with Roberto Cipriani, general director of the bank, agreed to be questioned by the magistrates of Rome. Their deposition filled 91 pages of transcripts, portions of which were leaked to the press.

It was a level of cooperation unprecedented in the history of the Vatican bank. In 1993, when he was called for questioning by the magistrature of Milan, Angelo Caloia, at the time  president of the I.O.R. , got the magistrates to submit a request internationally, with the request forwarded through diplomatic channels to the Holy See as a foreign state.  At that point, the I.O.R, responded with a written deposition, also forwarded through diplomatic channels. It delivered the proof of malfeasance – concerning Enimont “payoffs” of about 45 million euros – and received general approval in the press for having cooperated with the legal system. But his spontaneous deposition, Gotti Tedeschi did not succeed his goal, since the magistrates did not deem satisfactory the clarifications given, and responded “no” to the request to release the confiscated 23 million euros.

The goal had been reached with the the law no. 127 of the Vatican State, that adopts four new laws in implementation of the monetary convention – among the ones the Law concerning the prevention and countering of money laundering and of the financing of terrorism – and that regulates the competences of the Authority for Financial Information.

The president of the Authority for Financial information is the Cardinal Attilio Nicora, who also remains president of the Administration of the Patrimony of the Apostolic See. Among the members of the board, there are Marcello Condemi and Giuseppe Dalla Torre. Condemi was the deus ex machina of the new Vatican legislation against money laundering, while Dalla Torre represents the “Vatican” branch inside the Authority, since he is also president of the Court of the Vatican State. The members of the board have the job to give an international warranty to the transparency of the Ior operation, by storing all the money transfer of the I.O.R. in an archive, in order to be able to control each money transfer operation in the bank. Right after the 23 million euro had been confiscated, the I.O.R. – whose accounts are attributed by codes, and not by names – asked his current account holder to fill a detailed schedule to bank more than 10,000 euros. This request has been formalized by the law no. 127. There are problems to apply this law, indeed. If a I.O.R. account holder  directs with an overnight bag to the Torrione Niccolò V – where the bank is based – the Vatican guards would eventually ask him if there is something to declare. But if this account holder declares that he is waited from a cardinal, and that he is bringing to him that overnight bag, no one would stop him at the customs house. Who can be sure that the cardinal who received the overnight bag goes afterward to the I.O.R. to bank the money?

These kind of problems has still not been solved. But the only presence of the law satisfied Italian magistrates, who revoked the seize of 23 million euros. The Holy See made an official statement, underlining its satisfaction, but Ettori Gotti Tedeschi did not. In fact, the new law his not part of the job of his administration, but it is a step a in process toward the I.O.R. transparency whose origins dates before Ettori Gotti Tedeschi presidency, and drove by the A.P.S.A.

Yet, in the past months, trying to un-seize the 23 million, Gotti Tedeschi spoke several times about the “23 million issue”, claiming that the Vatican bank glasnost began under his administration. And a “deep throat” told to Corriere della Sera, the main Italian news daily, that «in ten months, more has been done than in twenty years, there are decades of habits to be changed»: this statement has given flesh and bones to the black legend according to which the legal troubles of the current president of the IOR, Gotti Tedeschi, in office since September 23, 2009, can be attributed to the mismanagement of his predecessor Angelo Caloia, in office during the previous twenty years. Gotti Tedeschi insists that he never said or thought this, while Caloia has demanded that the Vatican secretariat of state make public reparation for the affront, or – at least – to have the opportunity to write an article for the Osservatore Romano.

On march, 12, 2011, Caloia would eventually ended the fouth five year-term as president of the Bank of the Vatican. It was replaced by Ettore Gotti Tedeschi in 2009, but he had already been victim of manoeuvres to be sostituted. In 1999, Hans Tietmeyer, former president of Deutsche Bank, was backed as new president of the I.O.R. from the “old guard” of Vatican Curia. At a conference given by Tietmeyer at the Pontifical Academy of Sciences, Caloia stood up to criticize his ultraliberal theses. The Holy See did agree with Angelo Caloia.

And Holy See still agrees, if one reads the Benedict XVI’s encyclical Caritas in Veritate. But, on the other hand, the new president of the I.O.R. is a staunch proponent of a capitalism inspired by Christianity. Gotti Tedeschi is so ultraliberal to have signed, in 2007, a manifesto in 13 points, spearheaded by the former secretary of the highly secularist radical party, Daniele Capezzone. The manifesto proposed a single 20 percent “flat tax,” presidential government according to the American or French model, tax credits for health care and education, the requirement that the public administrator pay for all damages incurred, the changing of the retirement age to 65, tax exemption for overtime work, the abolition of professional associations and of the legal status of study certificates. When the Caritas in Veritate sketches were ready, Gotti Tedeschi – who was still not president of the I.O.R. – were writing articles on the Osservatore Romano about the creation of “a new economic bubble” to save the economy, and about the need to found a good bank to finance the developing countries – this latter proposal backed from the then British Prime Minister Gordon Brown. Then, Gotti Tedeschi gave his contribution in writing Caritas in Veritate, and now he brings out in several conferences the parts of the encyclical he agrees with, which are the parts considered more in continuity with the John Paul II encyclical Centesimus Annus. Centesimus Annus has never been seriously accepted by the hierarchy or by Catholics as a whole. It has been judged as too friendly toward the capitalist system.  Gotti Tedeschi, on the other hand, considers Centesimus Annus so important to launch the proposal to candidate John Paul II to the Nobel Prize for Economy.

What is the position of the Church? It is sufficient reading a Joseph Ratzinger conference of 1985, when he wrote that «the well-known remark made by Theodore Roosevelt in 1912: “I believe that the assimilation of the Latin-American countries to the United States will be long and difficult as long as these countries remain Catholic.” Along the same lines, in a lecture in Rome in 1969, Rockefeller recommended replacing the Catholics there with other Christians  — an undertaking which, as is well known, is in full swing. In both these remarks, religion — here a Christian denomination — is presupposed as a socio-political, and hence as an economic-political factor, which is fundamental for the development of political structures and economic possibilities».

Ratzinger quoted these theories to criticize them, and this is still is position. Religion is part of integral human development, that  passes through economy, but – firstly – from the human integrity. A “good bank” would not be sufficient. And the I.O.R. does not become a good bank filled with ethics just by changing the legislation. I.O.R. is going to became a “true” international bank. But its privateness criteria will eventually be similar to the Switzerland ones.