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| Where does all the Vatican's money really come from? (Photo by Joao Maximo) |
In a small room on an upper floor of the Vatican’s only bank, dozens of auditors pore over accounts looking for potentially sinister activity. The bank, known as the IOR or Institute for Works of Religion, is, perhaps fittingly, housed in a medieval tower that once was used as a Vatican prison. It is undergoing a tedious reinvention of sorts, trying to clean up its act after decades of scandals. Rooting out clients who have used the bank’s lackadaisical standards is an essential step in its reincarnation as a trustworthy financial institution...
According to the initial findings outlined in the report, IOR has been steadily identifying many more suspect bank clients than ever before. In 2012, there were just six cases of suspicious activity by account holders reported to authorities; in 2013, there were 202 such cases.
According to René Brülhart, the oversight director of the AIF, pressure from international banks that the IOR does business with played an important role in the progress. “This increase is also due to international cooperation fostered by a series of bilateral agreements we have concluded,” he told reporters on Monday when he presented the report.
But despite the bank’s efforts to improve its best practices, not everyone is willing to do business with the IOR just yet. Among the most problematic entities that refuse to recognize the IOR as a trustworthy financial institution is the Bank of Italy, which reigns over dozens of Italian banks and many international banks with Italian branches. That means Italian account holders with IOR accounts, including countless Vatican employees who live in Rome and get paid into their Vatican bank accounts, cannot transfer funds to most banks outside the Vatican City State, which then forces them to transfer the money in cash, opening the door to tax evasion, corruption or money laundering.
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