We’ve discovered hundreds of millions of euros off the Vatican’s balance sheet, says cardinal

Cardinal George Pell: Vatican finances were allowed to 'lurch along, disregarding modern accounting standards' (CNS)

Cardinal George Pell offers candid account of financial reforms in an exclusive article in the first issue of the new Catholic Herald magazine

Vatican reformers have discovered hundreds of millions of euros that did not appear on the Holy See’s balance sheet, the cardinal charged with sorting out the Curia’s financial affairs has said.

Writing exclusively in the first issue of the new Catholic Herald magazine, Cardinal George Pell says that the discovery means that the Vatican’s finances are healthier than they first appeared.

He writes: “It is important to point out that the Vatican is not broke. Apart from the pension fund, which needs to be strengthened for the demands on it in 15 or 20 years, the Holy See is paying its way, while possessing substantial assets and investments.

“In fact, we have discovered that the situation is much healthier than it seemed, because some hundreds of millions of euros were tucked away in particular sectional accounts and did not appear on the balance sheet. It is another question, impossible to answer, whether the Vatican should have much larger reserves.”

Cardinal Pell was appointed prefect of the newly created Secretariat for the Economy in February, making him the most senior English-speaking official in the Vatican.

He explains that reformers had to tackle an ingrained sense of independence among Vatican departments.

“I once read that Pope Leo XIII sent an apostolic visitor to Ireland to report on the Catholic Church there,” he writes. “On his return, the Holy Father’s first question was: ‘How did you find the Irish bishops?’ The visitor replied that he could not find any bishops, but only 25 popes.

“So it was with the Vatican finances. Congregations, Councils and, especially, the Secretariat of State enjoyed and defended a healthy independence. Problems were kept ‘in house’ (as was the custom in most institutions, secular and religious, until recently). Very few were tempted to tell the outside world what was happening, except when they needed extra help.”

The cardinal suggests that for centuries unscrupulous figures took advantage of the Vatican’s financial naïvety and secretive procedures.

Vatican finances were unregulated and allowed to “lurch along, disregarding modern accounting standards”. But no longer: new structures and organisations are bringing Vatican finances into the 21st century, and making their workings transparent, with full accountability.

The cardinal writes: “A German princess once told me that many used to think of the Vatican as being like an old noble family slowly sliding towards bankruptcy. They were expected to be incompetent, extravagant and easy pickings for thieves. Already this misapprehension is dissolving.

“Donors expect their gifts to be handled efficiently and honestly, so that the best returns are achieved to finance the works of the Church, especially those aimed at preaching the Gospel and helping the poor escape from poverty. A Church for the poor should not be poorly managed.”

Cardinal Pell says the involvement of lay experts is a fundamental part of the financial reforms. In the New Year, the Vatican will name a lay person as auditor general. This new figure will be answerable to the Pope, but autonomous and able to conduct audits of any agency of the Holy See at any time.

“These reforms are designed to make all Vatican financial agencies boringly successful, so that they do not merit much press attention,” the cardinal writes. “Such ambitions cannot ensure that we will not find some static on the lines in the next year or so. But we are heading in the right direction.”

The cardinal also discloses that bishops around the world are eager to learn lessons from the Vatican’s financial overhaul.

“The responsibilities of the Secretariat for the Economy are limited to the Holy See, Vatican City State and the almost 200 entities directly answerable to the Vatican,” he writes. “But already some cardinals and bishops have wondered aloud whether the new set of financial procedures and chart of accounts, introduced in November this year in the Vatican, might be sent to bishops’ conferences for consideration and use. This is something for the future.”

About The Voice Of Bombay's Catholic Laity

Bombay Laity Ezekiel’s Chapter 3 Task as Watchman 17 “Son of man, I have made you a watchman for the people of Israel; so hear the word I speak and give them warning from me. 18 When I say to a wicked person, ‘You will surely die,’ and you do not warn them or speak out to dissuade them from their evil ways in order to save their life, that wicked person will die for[b] their sin, and I will hold you accountable for their blood. 19 But if you do warn the wicked person and they do not turn from their wickedness or from their evil ways, they will die for their sin; but you will have saved yourself.
This entry was posted in Church Worldwide news. Bookmark the permalink.

6 Responses to We’ve discovered hundreds of millions of euros off the Vatican’s balance sheet, says cardinal

  1. Cardinal Pell must be congratulated for his image in taking on the administration at The vatican in financial matters. We at Mumbai (Bombay) India also had a priest who took on the Archdiocese of Bombay in financial matters and suffered the wrath of The AB House. This was clearly mentioned by his brother at requiem mas when this holy priest left to meet his Maker. Keep it up cardinal Peel, Your efforts will reap heavenly rewards.

  2. Peter Prabhu says:

    Ivan Cardinal Rome should be able to tell us partially, where some of the money embezzled has gone?

  3. Isaac Gomes says:

    It is very strange that hundreds of millions of Euros were tucked away in particular accounts and did not appear in the balance sheet. This must be the height of accounting methods. For if the money was shown in some accounts (whatever heads it may be), it should have been reflected in the Balance Sheet. Even if it were shown in suspense accounts, it would have appeared in the Balance Sheet. The previous Auditors should be pulled up for this “discovery’ (by the new auditors?). Didn’t their Audit Report say : “We have examined the Balance Sheet as at …..and the Income & Expenditure Account for the year ended …. of M/s……… We certify that the Balance Sheet and the Income & Expenditure Account are in agreement with the Books of Accounts and Receipt & Payment Account maintained at the Registered Office at……..” “We have obtained all the information and explanations which, to the best of our knowledge and belief were necessary for the purpose of the audit. In our opinion proper books of accounts have been kept on cash or ……….basis by the assessee”?

    Vatican’s Auditors knew of all the bank accounts of the Vatican. So what does Cardinal George Pell mean by stating “hundreds of millions of euros tucked away in particular sectional accounts” ? Was it deposited in some other bank account not disclosed to the Vatican Auditors? Or was it hard cash stashed away in a secret vault?

    If it was the discovery of the cash, a part of it could be the covert return of 15 million euros invested by Cardinal Tarcisio Bertone once widely tipped to succeed Pope Benedict).

    Two years ago, the Vatican bank invested 15 million euros in an Italian television company called Lux Vide SpA, that makes family movies, including films about popes and a series about a bike-riding country priest who helps police solve crimes. The Vatican’s then Secretary of State Tarcisio Bertone had ordered the investment in which he said shares the Holy See’s “lofty goal of evangelization”.

    Bertone, who was the second-in-command to former Pope Benedict, pushed the deal through despite objections from the bank’s director and board members, who thought the expense was too big and not justified for the bank, according to current and former bank executives.

    The Vatican booked a loss for the entire amount spent (read given away to Cardinal Tarcisio Bertone, a Salesian), as part of a wider review of its finances that has also led to the closure of hundreds of accounts at the Institute for Religious Works (IOR) as the bank is called.

    Similar practice of the Cardinal is being followed by the Salesians of India. One Parish Priest in Calcutta (known to have huge stomach for big money and big construction projects), was allowed to escape from his parish, very early in the morning with his bags and baggage, after a lot of financial controversy and strong arm tactics including hobnobbing with the ruling party, He did so without any handover of accounts and assets, an act in which he was aided and abetted by his Provincial who also got transferred almost simultaneously in June 2014. The next parish priest has taken over without any official handover. This means the previous parish priest will always be allowed to run away with the booty (Laity’s money) and the new incumbent will always start with ZERO BALANCE! The Cardinal may have gone but his financial art lives on.

    Truth is stranger than fiction, the Vatican seems to be falling from frying pan to fire and the CBCI keep mum on adopting the financial reforms initiated by our Pope, the one-man army!

    Isaac Gomes, Kolkata

    • How very shameful. That too at The vatican. As one clergy here at Mumbai said to me, this goes on at all places, its now its getting exposed.
      I am ashamed and would like to see and hear what Pope Francis does to find out who pinched the money.

    • Peter Prabhu says:

      There is a Church driven Addiction NGO, try getting accounts there! On the same lines.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: