Priest held in Vatican bank probe

Written By Unknown on Jumat, 28 Juni 2013 | 19.51

A SENIOR Catholic cleric has been arrested on suspicion of fraud and corruption in connection with a sweeping probe of the scandal-plagued Vatican bank, Italian media reports say.

Contrary to earlier media reports, the arrested cleric Nunzio Scarano is not a bishop but a priest from Salerno in southern Italy who is called "monsignor" in recognition of his seniority at the Holy See, Vatican senior media adviser Greg Burke said.

Scarano was arrested after an investigation into the Institute for Works of Religion (IOR), as the bank is known, unearthed a suspected international fraud scheme, reports said.

The senior cleric was suspended from his position as a member of the administration that manages the Vatican's assets (the APSA) "about a month ago, after his superiors learnt about an investigation into his activities," Vatican spokesman Federico Lombardi said.

Scarano was arrested along with a former member of the Italian secret services and a financier, reports said.

Police declined to confirm the arrests, saying a press conference would be held later on Friday.

ANSA news agency said the three arrested men were suspected of plotting to illegally move 20 million euros ($A28.29 million) from Switzerland to Italy.

The money allegedly belonged to friends of Scarano and was brought into Italy on board a private jet belonging to Italian former secret service agent Giovanni Maria Zito, the reports said.

Zito purportedly received 400,000 euros for the service.

According to the daily La Repubblica, Scarano is also under investigation by the Salerno prosecutor on suspicion of money laundering.

"They called him Monsignor 500... because of the great number of 500 euro notes he had at his disposition," which he allegedly used to launder money for friends in southern Italy, the newspaper said.

It added that it was an initial investigation into Scarano's bank account at the IOR which led to the discovery of the suspected racket.

In a bid to tighten control of the bank's activities, Pope Francis announced on Wednesday a sweeping study of the bank before a possible clear-out of top management at the Holy See.

In his first real step towards reform, the pontiff is to take a hands-on approach, ensuring that everything a special five-member commission uncovers will be reported directly to him.

Pope Francis, elected amid an in-house debate over whether it is necessary to have a Vatican bank at all, has railed against the cult of money, calling for a "poor Church".

He has also quipped that "St Peter did not have a bank account", and warned the IOR and other Vatican staff that "offices are necessary but they are necessary only up to a certain point".

The IOR, which does not lend money, manages assets of 7 billion euros and handles funds for Vatican departments, Catholic charities and congregations as well as priests and nuns living and working around the world.


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