Church of the Poor Judgment

The Economist
November 10, 2015

http://www.economist.com/news/europe/21677982-holy-see-cracks-down-leaks-about-its-scandalous-finances-church-poor-judgment

Who will rid me of these troublesome auditors?

THE Vatican is an oddity: a state within a city that is the capital of another state. Seldom have the anomalous relationships between the Vatican, Rome and Italy been more in evidence than this week. On November 5th, two books came out in Italy that included the latest in a long series of eyebrow-raising revelations about the Vatican’s finances. Both draw on leaks from confidential reports prepared for Pope Francis and his predecessor, Benedict XVI, as part of a drive to clean up the Vatican’s act (not least in order to comply with international regulations on money-laundering and the funding of terrorism).

Three days before publication, the papal spokesman revealed that detectives of the Vatican Gendarmerie had traced the origin of the leaks and locked up two former members of a committee established by Francis to advise him on restructuring his financial bureaucracy. Francesca Chaouqui, a public-relations executive who denies any wrongdoing, was let go after being detained overnight in a convent. But a senior Vatican prelate, Lucio Angel Vallejo Balda, was still being held as The Economist went to press. (He has been detained in the same lock-up in which the pope’s butler, Paolo Gabriele, was confined in 2012, after he was fingered as the source of the last big leak of embarrassing Vatican secrets.) Neither Ms Chaouqui, an Italian, nor Monsignor Vallejo, a Spaniard, has Vatican citizenship. But the pope’s prosecutor claims jurisdiction over their alleged offences. If indicted, they risk up to eight years in jail.

The books’ allegations may trouble the consciences of the Catholic church’s leaders. They hardly square with the church of (and for) the poor that Francis says he seeks. One of the authors claims the Holy See’s real-estate holdings, not including church properties such as cathedrals, are worth at least ˆ4 billion ($4.4 billion). He also says a fund for the care of sick children paid ˆ200,000 towards the conversion of a cardinal’s penthouse apartment and ˆ23,800 to charter a helicopter for him.

Other disclosures bear on the Vatican’s relationship with Italy. According to a leaked auditors’ report, the Vatican earns ˆ60m a year selling petrol, cigarettes and other products at below-market prices in Italy. They should be available only to the city-state’s citizens, yet more than 40,000 Italians are said to have cards giving them access to the shops beyond the Vatican’s walls. One of the books reports a request from Italian prosecutors for information on a named individual suspected of hiding taxable assets in the Vatican bank.

(Vatican officials insist all accounts opened without good reason by lay Italians are now blocked.)

While the city-state can be a thorn in the side of Italy and its capital, it can also be a blessing, both spiritually and fiscally. Every 25 years, by tradition, the Vatican declares a holy year, or “jubilee”, which attracts millions of pilgrims and pours money into Roman coffers. Popes can also declare jubilees in intervening years, as Francis has done. This extraordinary jubilee is due to start on December 8th.

Yet even this windfall can become a burden. Francis’s announcement of the jubilee took Rome’s government by surprise. The city administration is already plagued by corruption and deficient public services; with just a month to go, it is woefully unprepared for a deluge of new tourists. On October 30th, more than half the city’s councillors resigned to oust the mayor, Ignazio Marino, who was accused of (and denies) fiddling his expenses. He has been replaced by a government-appointed commissioner. The central theme of all jubilees is pardon. Quite a lot may be needed in the Vatican, as in Italy, in the months ahead.