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New books claim widespread mismanagement of Vatican finances

The Institute for the Works of Religion, popularly known as the Vatican Bank (CNS)

The Vatican’s new leaks scandal intensified on Tuesday as a book detailing claims of mismanagement and internal resistance that has been thwarting Pope Francis’s financial reform efforts.

Citing confidential documents, it exposed millions of euros in potential lost rental revenue, the scandal of the Vatican’s saint-making machine, greedy monsignors and a professional-style break-in at the Vatican.

Merchants in the Temple, by Italian journalist Gianluigi Nuzzi is due out on Thursday but an advance copy was obtained on Tuesday by the Associated Press. Its publication, and that of a second book, come days after the Vatican arrested two members of Francis’ financial reform commission in an investigation into stolen documents.

The Vatican on Monday described the books as “fruit of a grave betrayal of the trust given by the Pope, and, as far as the authors go, of an operation to take advantage of a gravely illicit act of handing over confidential documentation.”

“Publications of this nature do not help in any way to establish clarity and truth, but rather generate confusion and partial and tendentious conclusions,” the Vatican said.

The arrests and books mark a new phase in the so-called “Vatileaks” scandal. The saga began in 2012 with an earlier Nuzzi expose, peaked with the conviction of Benedict XVI’s butler on charges he supplied Nuzzi with stolen documents, and ended a year later when Benedict resigned.

With the scandal still fresh, Francis was elected in 2013 on a mandate from his fellow cardinals to reform the Vatican bureaucracy and clean up its opaque finances. He set out promptly by creating a commission of eight experts to gather information from all Vatican offices on the Holy See’s overall financial situation, which by that time was dire.

Mgr Lucio Angel Vallejo Balda, a high-ranking Vatican official affiliated with the Opus Dei movement, and Francesca Chaouqui, an Italian public relations executive, were both members — and now are accused in the leaks probe.

Nuzzi’s book focuses on the work of the commission and the resistance it encountered in getting information out of Vatican departments that have long enjoyed near-complete autonomy in budgeting, hiring and spending.

“Holy Father … There is a complete absence of transparency in the book-keeping both of the Holy See and the Governorate,” five international auditors wrote to Francis in June 2013, according to Nuzzi’s book. “Costs are out of control. This applies in particular to personnel costs, but it also extends elsewhere.”

Citing emails, minutes of meetings, recorded private conversations and memos, the book paints a picture of a Vatican bureaucracy entrenched in a culture of mismanagement, waste and secrecy.

Pope Francis has repeatedly and publicly warned the Roman Curia against engaging in “intrigue, gossip, cliques, favouritism and partiality” and acting more like a royal court than an institution of service. Last Christmas he delivered an infamous dressing down of his closest collaborators, citing the “15 ailments of the Curia” that included living “hypocritical” double lives and suffering from “spiritual Alzheimer’s.”

That said, the book appears to be written from the point of view of the commission members, sympathetic to their plight and setting up an “us against them” narrative of the new reformers battling the Vatican’s entrenched ‘old guard’, without addressing why the established officials might have had reason to distrust them.

The book cites a memo listing six priorities when the commission began work, starting with the need to get a handle on the Vatican’s vast real estate holdings. Nuzzi cites a commission report that found that the value of the real estate was some 2.7 billion euros, seven times higher than the amount entered onto the balance sheets.

Rents were sometimes 30 to 100 percent below market value, the commission found, including some apartments that were given free to cardinals and bureaucrats as part of their overall compensation or retirement packages. The book says that if market rates were applied, homes given to employees would generate income of 19.4 million euros rather than the 6.2 million euros currently recorded, while other “institutional” buildings which today generate no income would generate income of 30.4 million euros.

The second priority on the commission’s list was to get a handle on the management of bank accounts for the Vatican’s “postulators,” the officials who spearhead candidates for sainthood. The process — which involves painstaking research into the “heroic” deeds of saintly candidates and the search for miracle cures — has always been steeped in secrecy.

Nuzzi estimates that the average price tag for a single cause is around 500,000 euros and has gone as high as 750,000 euros for one beatification. Funding comes from donors eager to see their candidate honoured. Causes that inspire wealthy donors get lots of funding, poorer causes get little — and often get stalled as a result. After the Vatican’s saint-making office told the commission it had no documentation about the postulators’ funding or bank accounts, the commission had the postulators’ accounts frozen at the Vatican bank, Nuzzi said.

In an indication of the controversy that the commission’s work engendered, Nuzzi recounts a previously little-known incident, the March 30, 2014 break-in at the commission’s offices and theft of commission documents, claiming the burglary was an inside job, as the thieves knew exactly which locker to target to get the documents.

“The action should be understood as a warning to those who were carrying out the most delicate inquiries; to those who were offering the pontiff the tools for revolutionising the Curia,” Nuzzi concluded.

Another book, Avarice, by La Repubblica Vatican reporter Emiliano Fittipaldi, details financial malfeasance at the Vatican, citing among other documents reports by independent auditors.

Among the revelations, Fittipaldi wrote in Tuesday’s paper that a foundation to support the Bambino Gesu pediatric hospital in Rome paid 200,000 euros toward the renovation of the former Vatican secretary of state Cardinal Tarciso Bertone’s apartment, under an agreement that the apartment would be used also for hospital functions.

Cardianl Bertone was criticised last year for the apartment, described as a “mega-penthouse,” in contrast to Francis’s vision of a “poor Church.”

Fittipaldi also said 378,000 euros donated in 2013 by churches worldwide to help the poor, the so-called Peter’s Pence, wound up in an off-the-books account that had been used in the past to pay Vatican department expenses.