By Isla Binnie
ROME (Reuters) - A Roman Catholic prelate has been arrested for allegedly defrauding hundreds of elderly people out of millions of euros through an elaborate money-laundering scheme, Italian police said on Wednesday.
Monsignor Patrizio Benvenuti, 64, originally from Argentina, has been placed under house arrest, and an international arrest warrant has been issued for French financier and property dealer Christian Ventisette, 54, whom authorities have not been able to find, finance police said in a statement.
Police said the pair persuaded 300 would-be savers in France, Belgium, Switzerland, Luxembourg, the United States and Italy to invest 30 million euros ($34 million), encouraged by the promise of helping a charitable foundation.
Contacted by Reuters, Benvenuti said he "substantially rejected" the accusations aimed at him personally. He added that he did not know about finance, suggesting Ventisette had been responsible.
"The funds disappeared, but they are not in my pockets or in those of the foundation. They are in the pockets of the person who duped everyone," Benvenuti said.
Benvenuti worked at the Vatican's legal tribunal and as a military chaplain before retiring from priestly duties.
The victims thought they were entrusting their savings to finance and property sector experts. Police said they were spurred on by Benvenuti's promise that they would also be helping a charitable foundation he falsely boasted was supported by senior Vatican officials.
"He exaggerated the Vatican's support for his foundation," police captain Alessandra Faietti said, adding the organization's statutes referred to a high-ranking archbishop who has denied being involved in its activities.
The investigation started after a former nun went to the police saying she had received bank documents showing movements of hundreds of thousands of euros that she could not explain.
She said she had signed contracts which gave her titular roles in companies tied to the alleged fraud while living with Benvenuti in Rome.
As part of the investigation, police ordered the confiscation of an eight-million-euro villa in Tuscany, and an archaeological site in Sicily.
Nine other people are also being investigated in the investigation, which includes charges of alleged tax evasion.
(Reporting by Isla Binnie; editing by Ralph Boulton)