Merchants in the Temple (28 page)

Stories like this pop up periodically like underground springs, leaving the small Vatican community aghast. The latest case was in March 2015 and it took place at the Vatican, but as usual, no news of it leaked outside the Leonine Walls. Hidden microphones had been discovered in some offices of the Prefecture. “Unknown hands” had planted a system of bugs in the cars, offices, and homes of some of the priests who work there. They were not just ordinary priests and monsignors. The Prefecture is the control center for the whole financial system of the Holy See. During those weeks the astonished cardinals and monsignors could not stop wondering who would have planted those bugs, and why. The news also landed on the desk of Francis's personal secretary. One detail made the mystery even more complicated: not all of the hidden microphones worked. Some of them might have been bluffs, rudimentary electronic devices put there to send a message, a warning, to the Pope's collaborators that no secrets were safe.

Another mystery was that the Gendarmerie, as far as anyone could tell, had not been involved in the investigation. Whose job was it to identify the culprits if not the small state's internal security forces?

These questions troubled the men who had chosen to collaborate with Francis and believed in his message. And they forced greater caution on this Pope who had arrived in Rome from the ends of the Earth. Perhaps it was no accident that the whole block of Italian cardinals considered responsible for the Vatican's woes had managed to resist the Argentine Pope with such determination. Many of them were removed from office, it is true, but not all of them. Bertello remained at the helm of the Governorate. Calcagno was leading APSA. Versaldi had left the Prefecture, but only recently, for the new job of Prefect to one of the most important congregations, the Congregation for Catholic Education.

Francis's actions are never crude. He is waiting patiently for the majority to step down when they are forced to, at age eighty. In the meantime, he is monitoring them through the figures of men he trusts, like Monsignor Fernando Vérgez Algaza, a Spanish bishop. Promoted to Secretary of the Governorate, for many years he was close to the Argentine Cardinal Eduardo Francisco Pironio. Pironio was one of the cardinals whom Bergoglio used to see at the Vatican with pleasure during his trips from Buenos Aires in the 1980s and 1990s. Francis didn't seem to mind that a monsignor or cardinal belonged to an organization like Opus Dei, the Legionnaires of Christ, or the Focolari. What he valued above all was the independence, reliability, and consistency of various cardinals. And those who erred were cast out.

The story is told that Francis once met a monsignor with positions of responsibility behaving in a manner unbecoming the cassock he was wearing. Without batting an eye, Francis said: “I want you out of here by tomorrow. Later we'll decide where.” Only Francis knows if the story is truth or legend. Whatever the case, it is certainly plausible, and it captures his character perfectly.

Divide and Conquer

It would be simplistic and misleading to reduce the conflicts to a division between two worlds: on the one side the reformers, Francis together with Pell, Zahra, and de Franssu, who since July 2014 has been the number one man at the IOR; on the other, the “Italian” curia that obstructs and resists him. The situation is much more complex and muddled. The clearest example of this may be Vatican Asset Management (VAM), the project realized by de Franssu to better handle the assets of the Vatican.

There were fundamentally two versions of VAM. In the first, the project was meant to gather under one roof the real estate patrimony of the Vatican by creating a kind of sovereign fund. Then the proposal was made to manage part of the IOR investments in a SICAV (
Société
d'Investissement
à
Capital Variable
—Investment Company with Variable Capital), similar to an open-ended mutual fund in the United States. As a member of COSEA, de Franssu had already heavily promoted this plan in January 2014, for the purpose of building alliances. There were many dinners and meetings with Monsignor Wells of the Secretariat of State and Ernst von Freyberg, who at the time was the head of the IOR. De Franssu found an ally in Zahra, whom he had known ever since their days of working together at MISCO, the Maltese company that Zahra had founded to create incentives for Italian investment into the small island state. In this way COSEA was giving its endorsement and de Franssu presented the VAM project for the approval of the IOR board, chaired by Cardinal Santos Abril y Castelló. But the elderly Cardinal vetoed the idea. De Franssu considered the project fundamental to his future, however, and he refused to give up, so he decided to involve the Pope directly.

The VAM project ended up on the Pope's desk, in his small suite in the Santa Marta guesthouse. At the end of May, the Pope also rejected the idea, confirming the decision of his cardinal friend. The Holy Father did not want to put too much power in the hands of so few people.
Divide and conquer
as the ancient Romans used to say: in this case, divide the power among the subordinates and command. In 2015 trust in de Franssu was declining, but not so much because two years earlier Bertone himself had indicated de Franssu as a candidate for the leadership of the IOR, to replace Ettore Gotti Tedeschi. It was more because of the information finding its way into Santa Marta. A very thick and detailed file was delivered to the Pope in June 2014 on the relations between de Franssu and Zahra, and on relations between Zahra and the Vermiglio law office of Messina, for which the Maltese economist had done some work. These relations were completely transparent and above board, but they forced the Pope to reflect on the risk of placing too much power in laymen's hands.

Another thorn in Francis's side came from the selection of auditing companies in 2013 and 2014 to redesign the structure of the Curia. Some of the most delicate tasks had been assigned to the American company Promontory Financial Group, including oversight of the IOR's accounts. Promontory was supposed to be a guarantee, considering the prestige of its founder and CEO. He was Eugene A. Ludwig, a friend and law school classmate of former U.S. President Bill Clinton, with whom he had worked from 1993 to 1998. Many of the company's managers had been hired after cutting their teeth in federal agencies, to such an extent that the wags in the Vatican and conspiracy theorists saw Promontory as the long hand of the CIA.

In the Holy See there was a torrent of criticism of the powerful American company for its contradictory practices. A prelate who shall remain anonymous was interviewed in June 2015 for the television weekly news magazine
Report
. In his words, “To be considered transparent you need an independent consultant to certify your accounts. Today the IOR's accounts are being audited by the American company Promontory, which is paid by the IOR, so it will say whatever the IOR wants it to say. Not to mention that de Franssu's son was given a job at Promontory.” He was referring to Louis Victor de Franssu, who after studying at Notre Dame in Indiana, had been an intern in London at Goldman Sachs and a parliamentary assistant at the House of Commons before entering Promontory, where he deals with risk management and regulatory compliance.

As if this were not enough, a few weeks later American newspapers reported that the Department of Financial Services was investigating Promontory for its alleged role in the transfer of funds to Iran from the New York branch of the English bank Standard Chartered, back in 2011, when the country was under embargo. This was a source of embarrassment for the Vatican, considering all the sensitive information the Promontory advisors had viewed during their audit of the IOR. Consequently, a thorough control of all outside consultancies was ordered in the summer of 2015 with the instruction to suspend operations with any auditing companies that were not irreplaceable.

The attempt to reform the IOR was another unresolved issue. I have only hinted at it here because the IOR was not a target of the wide-ranging investigation conducted by the COSEA Commission that is the focus of this book. Today the Vatican bank is still impenetrable in many respects, and a world unto itself. It is hardly as opaque as it was during the pontificates of John Paul II—when it didn't even present a financial report and its clients laundered money from government kickbacks—and of Benedict XVI, but the Vatican bank is still far from trustworthy. The international auditing bodies have expressed positive assessments of the transparency measures introduced, but Francis still has profound doubts about it, though he has said or done nothing decisive about its internal structure. Various old-guard officials and directors have kept their prominent positions. And there are fears of a recurrence of the situation under former President Gotti Tedeschi—worries that money will continue to be misused without the leadership knowing about it.

Will the Pope Win the Battle?

It is hard to answer this question with any certainty. I believe that his project cannot be deferred or avoided, but it is hard to argue that he will succeed in bringing to completion his ambitious mission. There are too many interests at stake, both inside and outside the walls. The Mafia has always fought anyone who tried to destroy criminal systems that were able to launder huge amounts of money, and to turn dirty money into apparently normal legal financial realities. It is no accident that Italian prosecutors who are experts in organized crime, such as Deputy Prosecutor Nicola Gratteri, have repeatedly expressed their fear about threats to Pope Francis's safety. But he is following the path that he must take, and he will not allow himself to be intimidated—unless the pressures ultimately become so unbearable that he will feel forced to resign, as he slyly insinuates every so often. Francis—the great, singular Pope—has to count the number of his friends every day to make sure he will not be left alone.

 

Notes

Please note that some of the links referenced in this work may no longer be active.

1. Pope Francis Issues a Shocking Accusation