As the trial gets under way, lawyers for the secretariat have complained that several material witnesses are “unavailable” to them, but confirmed that Archbishop Edgar Peña Parra, Vatican secretariat sostituto, will take the witness stand.
The suit, first filed by Mincione in 2020 while he was under criminal investigation in Vatican City, has taken years to come to trial, and follows his conviction for financial crimes by a Vatican court in December last year, in which he was sentenced to more than five years in prison and made party to a group asset forfeiture worth hundreds of millions of euros.
Mincione, who managed hundreds of millions of euros in Vatican funds from 2013 until 2018, is seeking declaratory relief from the court — a judicial ruling that he acted in “good faith” in his dealings with the secretariat.
That building, the acquisition of which triggered a years-long criminal investigation and trial in Vatican City, was subsequently sold by the Secretariat of State for a loss of more than 100 million euros.
The London court’s eventual decision in the case could prove a kind of international vote of confidence in the sprawling Vatican trial, in which appeal hearings are set to begin next month.
‘Good faith’ dealings
In a statement to media Wednesday, Raffaele Mincione said he was “delighted that these proceedings in England are finally underway,” and that he looked forward to seeing his dealings with the Vatican “examined by an independent and internationally-respected judicial system.”
Mincione has repeatedly questioned the probity of the Vatican City trial which saw his conviction last December, and has previously told The Pillar that was made a scapegoat for institutional incompetence and corruption within the Secretariat of State.
In an interview last November, Mincione also claimed that several offers to cooperate with the Vatican City public prosecutor’s office were rebuffed, and noted that he stood accused (and was eventually convicted of) “embezzling” Vatican funds by taking for investment monies which, under Vatican law, were unavailable for the purpose.
Mincione produced in court letters signed by successive Secretaries of State asserting the investment with him was legal under Vatican law. Vatican City prosecutors argued, successfully, that those assertions were the result of the cardinals receiving deliberately misleading advice from secretariat officials, including Cardinal Angelo Becciu.
Mincione filed the London lawsuit in June of 2020, the month in which Gianluigi Torzi, one of his alleged co conspirators to defraud the secretariat, was arrested in Vatican City and while a Vatican warrant for Mincione’s arrest was active.
That same month, official Vatican media branded Mincione’s management of Vatican money “speculative and self interested,” and Mincione filed suit in London seeking a judgment that he acted in “good faith” in his dealings with the secretariat, claiming that the Vatican was seeking to undo its deal with Mincione over the London property.
However, in defense arguments before the UK court, lawyers for the secretariat made clear that there was no such attempt to nullify the transaction. Instead, they noted, Mincione’s case had been fully litigated in Vatican City, where he has already been convicted.
According to lawyers for the Secretariat of State, London judges must consider not just the details of Mincione’s separation from Vatican investments in 2018 — which have resulted in numerous allegations and criminal charges of fraud against multiple parties — but the beginnings of the business relationship between the Vatican and Mincione, which go back to 2012.
In pressing the claim that he acted in “good faith,” Mincione told The Pillar last year that he had been approached in 2012 by another now convicted co-conspirator, Enrico Crasso, to shepherd an investment by the Secretariat of State in an Angolan oil company proposed by Cardinal Becciu.
According to Mincione, his company performed due diligence on the deal, concluded it was financially unworkable, and essentially aimed to walk away from the deal.
But lawyers for the Secretariat of State say otherwise.
They argue that after Crasso introduced Mincione to the Vatican, Mincione initially championed the soundness of the plan, both via his company and personally, and set up a fund through which to direct the secretariat’s investment of more than $200 million.
Only after the fund was created and the Vatican’s money on deposit with Mincione’s company, secretariat of lawyers argue, did Minionce’s view of the Angolan investment project change, with a new determination that the whole project was unviable.
Lawyers say it was something of a bait-and-switch.
“This was particularly tricky,” argued the secretariat’s lawyers, “because the vast majority of this money had been secured through lines of credit which needed to be serviced. It was around this time that [Mincione’s company] began presenting the ‘opportunity’ to invest in the [London] property to the Secretariat of State.”
The secretariat’s lawyers explain that to raise its $200 million stake with Mincione for the Angolan project the secretariat “borrowed money by taking credit lines from two banks (Credit Suisse and Banca Svizzera Italiana), with securities deposited as collateral.”
The Vatican’s lawyers contend that because the money came from high interest lines of credit, they had a compelling need to invest the money immediately following the collapse of the Angolan project — something both understood and effectively exploited by Mincione.
More broadly, that line of argument also represents a significant factual concession by the Secretariat of State.
Those reports were repeatedly denied by senior Vatican officials, including Cardinal Angelo Becciu, who called them “false,” “misleading,” and “shameful.”
Now, the Secretariat of State’s lawyers argue that the source of the Vatican’s investment funds was key to Minione’s ability to quickly redirect its investment into his own projects, including the London building.
The realistic market value of that property is another contested point in the lawsuit over Mincione’s “good faith.”
When the Secretariat of State diverted the whole of its 200 million stake with Mincione into other projects proposed by him, the cornerstone investment was the London building at 60 Sloane Ave.
The Vatican’s stake in the building was 45%, valued at 180 million euros: a sum more than Mincione paid for the entire building only two years earlier and nearly as much as the Vatican was able to realize when it eventually sold the whole building in 2021.
Mincione’s legal team argue that in between, and throughout his stewardship of the Vatican investment, the building’s worth was continually, independently re appraised and the secretariat’s stake was fair value in the booming London property market of the time.
Lawyers for the secretariat argue that there was “no justifiable basis” for the value as presented to the Vatican, and that Mincione’s companies “already had a track record of trying to arm-twist valuers or to obtain valuations which clearly had no sound basis.”
Mincione also used Vatican funds to invest in his other businesses and projects. He gave his businesses no-penalty loans, while at the same time charging the Vatican millions of euros in performance and management fees.
He told The Pillar last year that the bonds from his own company he had the Vatican buy were his way of getting the Vatican some financial return on the portion of the 200 million funds that he hadn’t allocated to other investment projects — back in 2013, Mincione pointed out, uninvested cash basically lost value, since interest rates were near zero and outpaced by inflation.