Vatican seeks to make new watchdog independent

AP News
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Posted: Jul 07, 2011 9:43 AM
Vatican seeks to make new watchdog independent

The Vatican moved Thursday to make its new financial watchdog agency more independent by relieving its president of his other job running the Holy See's administration.

There had been questions about possible conflicts of interests when Cardinal Attilio Nicora was named president of the Vatican's Financial Information Authority earlier this year, given his dual roles.

The oversight agency, designed to be fully independent, began work in April to ensure all Vatican financial transactions comply with EU and international anti-money laundering and anti-terror financing laws. It was created amid an investigation by Rome prosecutors into suspicious financial transactions at the Vatican bank.

Vatican spokesman the Rev. Ciro Benedettini said Thursday that "common sense" dictated that as chief watchdog of the independent authority, Nicora couldn't be responsible for checking compliance of his other office, which administers Vatican personnel and other Holy See assets.

Nicora asked to be relieved of his administration job to focus exclusively on the financial authority, and Pope Benedict XVI agreed, the Vatican said.

In May, a Dutch liberal member of the European Parliament, Sophie in 't Veld, formally asked the European Commission to look into whether the Vatican's financial authority can be truly independent given Nicora's jobs and whether there wasn't a conflict of interest.

The authority was created as the Vatican issued new laws to fight money laundering and terrorist financing in a major effort to comply with EU norms and shed its image as a tax haven mired in secrecy and scandal.

The Vatican had pledged to pass such legislation by when it entered into a monetary agreement with the EU in December 2009, but the effort went into high gear following the money laundering probe at the Vatican bank, which greatly embarrassed the Vatican and its bank chairman, economist Ettore Gotti Tedeschi.

Rome prosecutors seized euro23 million ($33 million) and placed Gotti Tedeschi and his deputy under investigation, alleging the bank broke the law by trying to transfer money without identifying the sender or recipient. The two men have not been charged and recently prosecutors released the money.