VATICAN CITY (LifeSiteNews) – In an effort to bring decades of financial scandal to an end, the Vatican just released a new financial policy which mandates, among other things, that investments must align with the Church’s social and moral doctrine.
On Tuesday July 19, the Secretariat for the Economy sent a document to all heads of the Dicasteries of the Roman Curia outlining the policy that will now govern all the financial transactions of the Holy See and its curial offices.
Notably the policy expressly states that all investments must “be aligned with the teachings of the Catholic Church, with specific exclusions for financial investments which contradict its fundamental principles, such as the sanctity of life or the dignity of the human being or the common good.”
The policy specifically prohibits investing in industries engaged in pornography, prostitution, gambling, weapons and defense production, abortion, and laboratories or pharmaceutical companies that produce contraceptive products and/or work with embryonic stem cells.
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Additionally, investments that are “speculative in raw materials” are to be avoided, such as: the oil and mining industry, the nuclear energy industry, and companies producing alcoholic beverages.
An ethics committee has been established and tasked with assuring that investments are not made in companies at odds with Catholic moral teaching. The committee is made up of non-Italians: American Cardinal Kevin Joseph Farrell, and four outside lay financial experts from Britain, Germany, Norway, and the U.S.
The new policy also centralizes the location of accounts for the sake of transparency and oversight of funds and transactions:
“Curial institutions will have to entrust their financial investments to APSA, transferring their liquidity to be invested – or their securities deposited with foreign banks or with the IOR itself – to the APSA account set up at the IOR for this purpose. The APSA, as the institution that administers the patrimony of the Holy See, will set up a single fund for the Holy See into which investments in the various financial instruments will flow, and will have an account for each institution, processing the reporting and paying the returns.”
Background to new policy
The Vatican’s finances have been plagued with scandal for decades, but the more immediate background to the present reforms are two recent scandals involving investments made by the Holy See.
In 2016, APSA, the Vatican treasury, invested 20 million euros in a Swiss pharmaceutical company called Novartis, whose subsidiary Sandoz sells the abortifacient contraceptive known as the “morning-after pill.” Additionally, public scandal broke regarding money-laundering in the amount of 400 million euros in a speculative investment in two London apartment buildings, a failed enterprise that ended up costing the Holy See 140 million euros.
In an investigative interview with Italian news agency Report in June 2021, Libero Milone, the Vatican Auditor General at the time these scandals surfaced, revealed the full extent of the financial corruption within the Roman Curia. According to Milone’s testimony, it was his objection to Vatican officials regarding the Swiss pharmaceutical investments that resulted in the Holy See pulling out its money.
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However, when it came to the London apartments, Milone was continually blocked by the members of the Secretary of State, such as Cardinal Becciu, from accessing the accounts and documentation pertaining to the overseas transaction.
Nor was he the first auditor to be blocked by the Secretary of State when inquiring into its financial doings. The same thing had happened during an audit begun under Pope Benedict XVI. Milone, whom Becciu accused of spying, said he was forced to resign from his post as Auditor General due to threats to his safety.
In 2020, the Pope finally stripped the Secretariat of State of its control over its own accounts. Oversight of its transactions, together with those of all the Dicasteries of the Roman Curia, is now fully in the hands of the Secretariat for the Economy in an effort at fiscal transparency and accountability.
The London apartment at the center of the ongoing corruption trial regarding Cardinal Becciu was recently sold by the Vatican, with a reported loss of $200 million.