After the preliminary audience in the Vatican’s maxi-trial of Cardinal Giovanni Angelo Becciu and nine others on charges they bilked, swindled, hoodwinked, cheated, threatened, extorted, and/or stole millions from the Vatican, the business has taken on the look and feel of a phoney war. Don’t be deceived. The preliminary hearing on July 27th in Vatican City was basically a pre-trial hearing – a procedural prelude – with the next session in late October and those to follow it promising blood, steel, and fire (or at least major fireworks).
Here is what the trial is about, and here are a few things for which Vatican watchers will be watching.
What’s it all about?
The short-and-dirty version of a very long and very complicated jumble of a story is that Cardinal Becciu, when he was Archbishop Becciu and the sostituto in the Secretariat of State of the Holy See (basically the papal chief-of-staff), oversaw the Vatican’s participation in a real estate development project at 60 Sloane Ave, London. The old Harrod’s warehouse there would be converted into luxury apartments and sold for a nifty profit. Only, that’s not what happened – not exactly – not yet, and for the Vatican, not at all. The Vatican found a way to lose money on the deal.
It takes a pretty penny to get into the high end of London’s real estate market, but it is difficult to lose once you’re in, barring the total collapse of civilisation. That wasn’t on the cards in the middle of the last decade, when the Sloane Ave deal was coming together and falling apart. So, how did the Vatican manage to turn it into a loser?
According to Vatican prosecutors, Becciu and a coterie of unscrupulous figures both inside and outside the Vatican conspired to use monies from discretionary funds in the Secretariat of State – including the Peter’s Pence money, gathered annually by a campaign that touts the collection’s use in favour of papal charities in service of the world’s neediest and most vulnerable, but mostly used to plug holes in the Vatican budget and prop up flagging Vatican operations – to buy a partial stake in the Sloane Ave project. That’s not what the trial is about, though.
Pope Francis apparently didn’t lose much sleep over the use of Peter’s Pence monies for the deal. Questioned by a journalist during an in-flight presser in 2019, Francis responded: “First of all, in good administration it is normal for a sum to come from the Peter’s Pence, and what do I do? Put in a drawer? No, this is bad administration.”
“I look to make an investment,” Pope Francis continued, “and when there is the need, to give… when there is the necessity, in one year, you take it. Your capital you do not devalue, if it maintains or if it grows a little. This is good administration,” though he admitted there were “some things that do not appear clean” with the Sloane Ave business.
The businessman who facilitated the early stages of the deal, Raffaele Mincione, charged exorbitant fees for the management of the property. He used several companies – his own and others’ – to manage the management and the money. Each company charged its own fees, and pretty soon the deal was pulling out more than it could hope ever to bring in. The Vatican paid through the nose for its original, partial buy-in, too. CNA reported that the Vatican paid €180 million for a 45% stake in the property, which was more than Mincione had paid for the whole kit ‘n’ kaboodle. The Vatican decided they wanted to buy Mincione out, and allegedly purchased all but 1000 shares in the holding company that owned 60 Sloane Ave.
The Vatican wanted to stop the bleeding, in other words, but Mincione had arranged matters so that the 1000 shares he kept were the voting shares needed to control the company that owned the property. Suffice it to say it cost the Vatican another significant chunk of change to acquire those 1000 shares, some of which went to a fellow called Gianluigi Torzi, who came in at the Vatican’s request to broker the deal.
Torzi walked away with some €10 million for his trouble. Torzi and Mincione, it turns out, were not perfect strangers to one another, either. They’ve both been in hot water in Italy and elsewhere, as well. They also apparently know how to stride the dull and porous line that separates legitimate business from go-to-jail criminal activity. One way to think of them is as classic wide boys in expensive suits.
What Vatican watchers are watching for
The whole business really began to collapse between 2016 and 2018, when the Secretariat of State asked the Vatican’s Institute for the Works of Religion – that’s the “Vatican bank” – for a gargantuan loan to shore up the investment. The Cardinal Secretary of State, Pietro Parolin, even wrote a letter pinky-swearing the deal was good and the loan legit. Parolin would later claim he knew very little about the deal for which he personally vouched.
“We consider ourselves victims,” Cardinal Parolin told journalists in Strasbourg on July 4, in explanation of the Secretariat of State’s decision to constitute itself a “civil party” to the prosecutors’ criminal case.
Cardinal Parolin personally approved of several steps in the botched deal, it has been reported, as did Becciu’s successor in the sostituto’s role, Archbishop Edgar Peña Parra. What happened to Becciu, in the meantime? He got a red hat and became the prefect of the Vatican’s powerful saint-making dicastery, the Congregation for the Causes of Saints, in 2018. It’s awfully tough to see that development as anything other than Becciu’s being kicked upstairs, regardless of Pope Francis’s promises to end the time-honoured practice in the Vatican.
Another mid-level cleric involved in the business, Mgr Alberto Perlasca, was first suspended and then sent to his home diocese, but those steps did not save Perlasca from raids on his apartment and office in the Vatican.
With Cardinal Parolin and Archbishop Peña, Perlasca is among the clerics not indicted in connection with the deal, into which the Vatican pumped hundreds of millions of Euro and allegedly got fleeced by middlemen along the way.
Vatican News published some detailed background to the Vatican prosecutors’ case, in which the official news outlet reported that Vatican prosecutors believe “neither Msgr. Perlasca, who signed the Share Purchase Agreement, nor his Superiors, the Substitute Edgar Peña Parra, and above all Cardinal Pietro Parolin had been effectively informed to be fully aware of the juridical effects that the different categories of actions would cause.”
Mgr Perlasca, in fact, has turned state’s evidence. At the pre-trial hearing in July, defence attorneys objected to the use of his testimony, saying investigators interrogated him without the benefit of counsel. Prosecutors then announced that Perlasca had never been formally questioned at all, but had presented himself voluntarily. So, one thing to watch will be who Perlasca fingers and who he doesn’t.
Everyone facing charges has pled not guilty, and there’s reason for several figures facing trial to wonder how they ended up in the dock, at all.
Justice, and Vatican Justice
One of them is René Brülhart, the highly respected former head of the Vatican’s financial intelligence unit. Documents obtained by Italian reporters show that Brülhart had tried to put the brakes on the deal and was quietly working with other financial watchdogs, but a raid by Vatican police – ordered by Pope Francis – went awry, and sensitive documents ended up in the papers. That embarrassed the Holy See and got the Vatican’s financial intelligence unit temporarily suspended from the information-sharing network of the Egmont Group
Brülhart is charged with “abuse of office” – an odd theing with which to be charged as a stand-alone crime – but in any case it looks for all the world like he was the one fellow in this whole sordid affair who was only doing his job.
In a statement to journalists, Brülhart said he learned of the charges against him in the press, and called his indictment a “procedural blunder” that would “immediately clarified by the organs of Vatican justice.”
When it comes to Vatican Justice, one has to wonder whether it isn’t a different species of creature entirely, the way a Turkey Reuben is different from a Reuben sandwich (hence the capital T in turkey). Change the meat, and you change the sandwich, though you’d have to have tasted both to know what difference it makes.
Chris Altieri is editor-at-large of the Catholic Herald
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