The first clue that the Institute for Works of
Religion is a bank like no other lies just inside its imposing stone
entrance.
Tucked away on the left is an ATM machine with instructions in Latin: "Inserito scidulam quaeso ut faciundam cognoscas rationem" – insert your card to determine the desired operation.
The second clue lies in the Vatican Bank building itself, the magnificent gothic Tower of Pope Nicholas V, set within the walls of the tiny city state.Centuries ago the circular, 15th Century tower was used as a papal prison. Now it is the nerve centre of a campaign to hunt down modern-day miscreants as the Vatican, under the new management of Pope Francis, embarks on a concerted effort to crack down on money-laundering, tax evasion, hidden sources of income and other abuses that have besmirched the reputation of what 'Forbes' last year called the "most secret bank in the world".
Those efforts have been given greater urgency in the past month with a fresh scandal involving the arrest of a Catholic priest working as an accountant in the Vatican on suspicion of money-laundering.
Nunzio Scarano, who is now in a Rome jail, is accused of laundering money through at least two accounts held at the bank and of trying illicitly to bring in €20m in cash on a private jet from Switzerland.
In a plot worthy of a Dan Brown thriller, two others were arrested – a former member of the Italian secret services and a shadowy financier.
Adding to the baroque nature of the plot, the three alleged conspirators reportedly met through an ancient chivalric society, the Constantine Order of St George, which claims to have been founded in 313AD by the Emperor Constantine.
Just days after the arrests, Paolo Cipriani, the director of the bank, and Massimo Tulli, his deputy, resigned. They gave no explanation for doing so, but appeared to be the first casualties of Pope Francis's determination to reform the secretive institution and clean up its murky finances.
The Vatican has warned that the investigation into the priest, nicknamed 'Monsignor 500' for his penchant for flashing a wallet bulging with €500 notes, "could be extended to additional individuals".
APPARATUS
The scandal could hardly have come at a worse time – it broke just as the Vatican had put in place a whole new apparatus to enact reforms at the bank.
Those reforms are being led by the new president, Ernst von Freyberg, a German lawyer with an aristocratic pedigree stretching back nearly 1,000 years.
In a sign of his firm, no-nonsense approach, he gave up the large office usually occupied by the organisation's presidents to staff from the US-based regulatory consultant Promontory Financial Group, which is working to bring transparency to the bank's activities.
"I
became homeless – I gave them my office," he said, before reflecting
more seriously on the progress his team has made. "Am I content? Not
yet. Our reputation has been blurred by the Scarano case and it was a
shock."
Mr Von Freyberg took up his post in February
after his predecessor, Ettore Gotti Tedeschi, was abruptly dismissed
last year after being accused of neglecting basic management
responsibilities at the bank, which manages more than €7bn of Catholic
Church funds and last year made a net profit of €86.6m.
The
extent of the challenge facing the German banker is revealed by a
survey of media reports about the bank in recent times.
A multi-coloured
graph shows that the words most associated with the Pope's bank are
'scandal', 'crisis', 'fraud', 'Mafia' and 'bribes' – not a very
encouraging summary for an institution that is meant to be doing God's
work.
The day-to-day business of the bank takes place in a
huge circular room consisting of a half-moon of cashiers' desks.
Priests in clerical collars and black suits wait patiently alongside
elderly nuns to withdraw money or check the balance of their accounts.
The
bank's failure to keep up with the stringent banking checks introduced
after the terrorist attacks of September 11, 2001, left it vulnerable to
crimes such as money-laundering.
It is now having to play catch-up.
But
while the presidents of most banks answer to shareholders and a board,
Mr von Freyberg and his team are accountable not only to two heavyweight
commissions of cardinals, but also ultimately to the leader of the
world's 1.2bn Catholics, God's representative on Earth.
"The
Holy Father is looking very closely at what is happening here," said Mr
Hohenberg.
No pressure, then.