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Heads Roll at Vatican Bank

Heads Roll at Vatican Bank

On Monday, the Vatican Bank’s director and vice director resigned under pressure amid allegations that they are at the heart of the financial institution’s growing troubles. The high-level resignations of the two officials, Paolo Cipriani and Massimo Tulli, come just days after Vatican accountant Monsignor Nunzio Scarano, known as “Monsignor 500” for his habit of carrying cash under his cassock, was arrested for allegedly plotting to smuggle some $26 million from Switzerland into an unknown bank account in Italy with the help of a financial adviser and former spy. The resignations also follow Pope Francis’s appointment last week of a five-person cleanup crew tasked with reforming the bank, which no doubt put pressure on its administrators to shape up. The Vatican issued a terse statement saying that the resignations of Cipriani and Tulli were “in the best interest of the institute and the Holy See."

The bank’s current president, German magnate Ernst von Freyberg, who was appointed by Pope Benedict before his resignation, is now acting as president, director, and vice director while the bank’s board tries to reorganize itself. The pope’s reform team will likely have many suggestions on how to do that, and rumors abound that the pope isn’t sure that there is a need for a Vatican bank at all. The institution, which acts like a bank and has more than 19,000 account holders who can transfer funds to accounts around the world, insists it is not an actual bank because it does not lend money or make investments. But it does hold account holders’ funds in foreign banks and is less than transparent when it comes to its clients’ transactions. Von Freyberg issued a statement after the resignations were announced hinting that this is just the beginning. "While we are grateful for what has been achieved, it is clear today that we need new leadership to increase the pace of this transformation process,” he wrote, causing many to wonder if his will be the next head to roll.

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