The Vatican is expected to suffer a loss of £100 million from its botched property investment in London.
A deal to sell off its share of 60 Sloane Avenue, a building in Knightsbridge, to Bain Capital, a private equity group, is in its concluding stages, according to media reports.
Vatican City invested 350 million euros in a 45 per cent share of the building between 2014 and 2018 but will let it go for just £200 million.
The shortfall leaves the Vatican out of pocket by about £100 million, the majority of which was derived from “Peter’s Pence”, which funds the papal charities.
The scandal, which is at the heart of a criminal corruption case, has been blamed for a 40 per cent slump in donations to Peter’s Pence in the last five years.
The period corresponds with revelations of financial scandals which have dogged the papacy of Pope Francis.
They have culminated in the prosecutions of Cardinal Angelo Becciu, the former prefect of the Congregation of Causes of the Saints, and his former secretary, Mgr Mauro Carlino, along with eight others.
Their trial for financial crimes opened in a room at the Vatican Museums in July before it was adjourned.
The prosecution has accused Cardinal Becciu and his associates of a range of charges including embezzlement and abuse of office.
Cardinal George Pell, the Vatican’s former economy czar, told La Stampa and Corriere della Serra last week that some of the money lost in the Secretariat of State’s controversial London property deal could have been saved.
“There was resistance in the Secretariat of State,” he said. “But if the auditor, or we from the Secretariat for the Economy, had been able to intervene earlier, we would have saved a lot, a lot of money destined for the London building and also in other places.”
The cardinal was appointed by Pope Francis in 2014 to take charge of the newly created Secretariat for the Economy and lead efforts at reforming Vatican financial affairs.
Just two years later, an outside audit of Vatican finances, ordered by Cardinal Pell, was suspended by the Secretariat of State, revealing a power struggle between the two Vatican offices, according to Catholic News Agency.
Cardinal Pell, pictured, said that Cardinal Angelo Becciu, who at the time of the audit was the second-ranking official in the Secretariat of State, thought the auditor “had no authority to enter the Secretariat of State,” but “this was false.”
“We had the authority to enter, but they prevented us,” Pell said.
The cardinal told La Stampa that when he became economic chief in 2014, Vatican finances were still operating in the “old world,” and the economy office had to put in place “fundamental things”.
“We introduced the verification methodology that the whole world uses today. We discovered one billion and 300,000 euros scattered in offices. We prepared a budget for the first time before the start of the financial year,” he said.
Cardinal Pell said that he and his team probably could not have saved the Vatican all of the money it lost on the Secretariat of State’s deal on a London building, because “some things were already underway” in 2014, but “in other situations we did it.”
According to Vatican investigators, a two-year-long probe into the controversial London investment revealed numerous bad actors, some of whom are accused of actively working to defraud the Secretariat of State.
But in the first hearings of the trial, Vatican prosecutors have been accused of procedural errors, and have been ordered to conduct afresh a part of the investigation into seven of the 10 defendants, including Becciu.
The trial’s next hearing is scheduled for Nov. 17.
The trial will “go on, but slowly,” said Cardinal Pell. “I don’t know how it will proceed, but we know where we got, we know how they lost a lot of pounds with that London building and at least this is progress.”
In a statement made through his lawyer, Cardinal Becciu called Cardinal Pell’s comments a “tired revival, even if in the form of suspicion, of subjects of considerable gravity”.
“The diversity of views on the correct management of the temporal goods of the Church,” the statement said, “cannot authorise the use of prevarications, manipulation, and ad personam attacks unfastened from historical reality.”
Having been unable to sell in churches for well over a year due to the pandemic, we are now inviting readers to support the Herald by investing in our future. We have been a bold and influential voice in the church since 1888, standing up for traditional Catholic culture and values.
Please join us on our 130 year mission by supporting us. We are raising £250,000 to safeguard the Herald as a world-leading voice in Catholic journalism and teaching. For more information from our chairman on contributing to the Herald Patron's Fund, click here
Make a Donation
Donors giving £500 or more will automatically become sponsor patrons of the Herald. This includes two complimentary print/digital gift subscriptions, invitations to Patron events, pilgrimages and dinners, and 6 gift subscriptions sent to priests, seminaries, Catholic schools, religious care homes and prison and university chaplaincies. Click here for more information on becoming a Patron Sponsor. Click here for more information about contributing to the Herald Patron's Fund