VATICAN CITY
The Guardian
Stephanie Kirchgaessner in Rome
Wednesday 10 June 2015
The Vatican bank will automatically report information about American holders of its accounts to US tax authorities under an agreement signed on Wednesday that the American ambassador to the Holy See said was a “very significant step” to combating tax evasion.
The agreement – the first inter-governmental deal between the Vatican and the US – was hailed as a “type of stamp of approval” of the Vatican bank’s efforts to be more transparent, said the US ambassador, Kenneth Hackett.
The bank, which is formally known as the Institute for Works of Religion, has been dogged for years by accusations that it has helped launder money for rich Italians, among others, who were seeking to evade taxes and carry out other illicit activity. It began a clean-up process at the end of Pope Benedict’s tenure, following intense pressure by the Bank of Italy, which essentially sought to cut the bank off from working with other banks in Italy if it did not change its ways and adopt internationally recognised anti-money laundering regulations.
Pope Francis has also put financial reform at the top of his agenda, and the bank has spent millions of euros on consultants, including US advisory firm Promontory Financial Group, in its effort to implement a modern compliance programme and weed out problematic accounts.
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