The Curia Romana: “A Wilderness of Mirrors”


The Curia Romana: “A Wilderness of Mirrors”


Vatileaks 2 is now upon us, officially. On Saturday, October 31, 2015, the Vatican Police arrested a man and a woman who have been deeply involved in the Pope’s efforts to reform the Vatican’s financial and economic institutions:

Monsignor Lucio Angel Vallejo Balda, the coordinator of a task force (“COSEA”), commissioned by the Pope in July, 2013; andSignora Francesca Immacolata Chaouqui, the only woman member of the COSEA task force.

The two were summoned to the Vatican and then placed under arrest in the sovereign territory of the Vatican City State.

Monsignor Vallejo Balda is being held in the Vatican cell previously occupied by The Butler, Paolo Gabriele, the chief culprit of the original Vatileaks scandal. Signora Chaouqui was released since she has been cooperating with the investigation. The charges against the two are theft and dissemination of classified documents, per a Vatican law enacted in July, 2013, just as the COSEA task force began its work. The arrests are a preemptive move against the imminent publication of two tell-all books about Vatican financial misdeeds, and worse:

Gianluigi Nuzzi’s Via Crucis (on Amazon as Merchants in the Temple), and Emiliano Fittipaldi’s Avarizia (Avarice, also on Amazon).

Nuzzi is widely credited with breaking the Vatileaks story in 2012 (now Vatileaks 1), think of him as the Bob Woodward of the Vaticanisti press corp.

And Vatileaks 1 was probably the catalyst for Pope Benedict’s bomb-shell resignation in February of 2013.

The leaked documents

It is a virtual certainty that the classified Vatican documents on which these two books are based are genuine, not forgeries or dezinformatsiya. For the flavor of the disclosures consider the opening paragraph of Avarice, translated from Il Fatto Quotidiano:

Outside of here there is a parked car full of documents. From the IOR [the Vatican bank], from APSA [the holding company for many of the Holy See’s assets including portfolio investments and real estate], from the auditors summoned by COSEA [the Msgr. Vallejo Balda task force]. This is why I asked you to come by car. You would not have been able to haul them away with a motor-scooter.”

 The speaker is identified as a monsignor who has leaked files to the journalist, “224 pages of undisclosed classified documents that reveal the wealth, the scandals and the secrets of Francis’ Church.”

This is serious:  Vallejo Balda has been a key official in the Vatican’s financial nomenklatura, listed in the 2015 Annuario Pontificio as “secretary” (i.e. chief operating officer) for the Holy See’s Prefecture of Economic Affairs…something like Washington’s Office of Management and Budget, with supervision of spending by the Vatican curia, including major departments: twenty-one congregations and pontifical councils. As the coordinator of COSEA, the sharp edge of Francis’ reform effort, Vallejo Balda had the major role in the task force’s recommendations presented to the Pope.

It has been reported that the monsignor was keenly interested in the newly created position of “general secretary” for the economic super-department recommended by COSEA and created in 2014 by Francis.

This department is formally known as the Secretariat for the Economy headed by Cardinal George Pell, a former rugby champion in Australia aptly described as a bull who hauls around his own china shop. But Vallejo Balda did not get the job of general secretary, which went instead to the Pope’s former personal secretary. Motive, anyone?

Some of the sordid details

Daily excerpts from the two books are dribbling into the media. Since most of the oxygen in the U.S. media is sucked up by Donald Trump, The Kardashians, and Fantasy Football, here are some of the nuggets – all unproven allegations so far – as reported in the Italian media:

Item: The computer of the Holy See’s Comptroller General, Libero Milone, has been hacked. Milone is not a glorified bean-counter, he reports directly to the Pope who named him to this newly created job last June.

Item: Several premium residential properties in the Vatican’s real estate empire throughout Rome and Italy, allegedly have been offered at deep discounts (30% to 100%! Per The AP).These sweetheart deals were allegedly offered to several Vatican-friendly media personalities, including the host of Italy’s leading political talk show (Porta a Porta).

Item: There are allegations of diversion of funds donated to the Vatican’s childrens hospital, to remodel luxurious apartments of a leading cardinal. The most eye-catching allegation involves former Secretary of State Cardinal Tarcisio Bertone, now in retirement. Until he was replaced by Pope Francis in the fall of 2013, Bertone had been the Vatican’s de facto prime minister, with lots of latitude given to him by Pope Benedict who put him in the job in 2006. The cardinal was roundly criticized for redecorating his 3,000 SF apartment inside the Vatican’s 105 acres, where space is tight. In context, the Pope’s spartan quarters at the Casa Santa Marta are 500 SF.

It is alleged that about €200,000 (about $220,000) was spent on redecorating the cardinal’s flat, with the funds coming from the Foundation of the Infant Jesus, the leading children’s hospital in Rome. The cardinal wrote to the author of Avarice, [translated],

“…the undersigned [Bertone] paid the requested amount as my contribution to the restructuring.

But the president of the Infant Jesus Hospital Foundation at the time the repairs were made has stated that it was the hospital foundation that paid for the work.

Item: Peter’s Pence is the annual contribution to the Vatican from the pews of 220,000 parishes, world-wide.   As of 2013, it is reported that the fund totaled €378 million (about $416 million). But a report by Moneyval, the European Union’s agency with oversight for banks and financial transfers, had this to say about the final destination of moneys that had been donated to Peter’s Pence:

“[translated] in 2010 the disbursements [from Peter’s Pence] consisted principally of ordinary and extraordinary expenses of the dicasteries [congregations] and the institutions of the roman curia [pontifical councils and commissions],” [emphasis added].

Not unlike donations from the pews for clergy retirement, in a major American diocese (Go Red Sox), that went instead to? Destination unknown, but never got to the nearly busted Clergy Retirement Fund.

Item: The Vatican’s financial holding entity APSA is apparently being pulled into a money-laundering scandal. The Vatican’s prosecutor (known as the Promoter of Justice) has been investigating since last February allegations that APSA was used to move funds illegally between Italy and Switzerland, on behalf of a bank. The bank involved is not the notorious Vatican Bank (“IOR”), but an Italian private bank: ‘Banca Finnat Euramerica SpA’.

There are also allegations of market manipulation, where APSA would have sold securities which were then purchased by Banca Finnat.

It is worth bearing in mind that there is an as-yet undetonated IED in this situation: In mid-2014 APSA’s chief accountant, Monsignor Nunzio Scarano, was arrested at Rome’s general aviation Ciampino airport after arriving from Switzerland on a private jet, lugging a suitcase with €20 million (about $22 million) in cash. The monsignor was subsequently released on bail, and claimed that he was ‘following orders’ of his superiors in APSA.

It has been reported that he has been telling the investigators about the ‘Finnat system’, including the complicity of APSA officials in money laundering and manipulation of securities’ prices.

Item: In the latest media sampling running today, November 5, 2015 it is reported that a lot of money has changed hands in the Congregation for the for the Causes of the Saints. The key official for beatification and canonizations is the Postulator, and only two individuals are members of this select bar. As reported in Il Fatto Quotidiano:

In Avarice it is claimed that the ongoing process to beatify (not canonize) Archbishop Fulton Sheen involved fees of €332,000 (about $365,000) between 1998 and 2013, when the process was suspended because the Archdiocese of New York declined to have Archbishop Sheen’s remains moved from NYC to his hometown of Peoria.

For the beatification of Spanish philosopher Antonio Rosmini, the costs were reportedly €750,000 (about $825,000).

Item: Checking accounts in the IOR! Again. From Il Fatto, translated:

When Pope Bergoglio [shortly after his election] ordered an investigation of [the Congregation for Saints], COSEA [the finance task force coordinated by Vallejo Barda] ordered the blocking of 409 accounts in the IOR…for a total of €40 million (about $44 million). Among these [accounts] there was also a very heavy name, that of Monsignor Georg Gaenswein, the long-serving [private] secretary to Benedict XVI [and still holding that job with the pope Emeritus].”

Drip, drip, drip.


This is very much of a developing story, and the books’ publishers are doing what publishers do, to build up anticipation and pump sales.

The Vatican has heightened public interest with the extraordinary arrests over the weekend of October 31 last, all but naming their prime suspects in this industrial-sized theft and leak. However, the official Vatican commentary has been feeble:

Blaming the media; but what else would the media do?

Stating that “Vatileaks has been already dealt with through the Pope’s reforms;” apparently not so, especially in the matter of IOR accounts;

Pushing back against the Cardinal Bertone story about hospital funds, by announcing that several new members have been appointed to the hospital’s board. Basically, ‘he didn’t do it, and it won’t happen again’.

The question hanging in the air is Who? And, Why?

Lets just suppose that the Inspector Jacques Clouseau ploy used for Vatileaks 1, the butler did it, won’t work this time. CONFUSED? Welcome aboard.

In the world of murky affairs – espionage, complex business deals, Middle Eastern politics, Red Sox pitching, and the like – there is a memorable phrase from one of T.S. Eliot’s poems, Gerontion, which encapsulates the head-spinning difficulty of separating reality from illusion:  “…a wilderness of mirrors…”