Vatican imposes new investment policy amid financial scandal

The Vatican has centralised and overhauled its investment strategy after a botched deal lost tens of millions of euros.

t has imposed a policy that prohibits investments in products such as pornography and weapons and prioritises prudent investing in industries that promote the common good.

The new policy announced on Tuesday by the secretariat for the economy bans speculative investments, short selling and investing in highly leveraged or complex financial products or in countries vulnerable to money laundering and terrorist financing.

Vatican offices have one year to come up with a divestment strategy if any of their investments fall under prohibited categories.


Pope Francis has attempted to clean up the Vatican’s finances (Andrew Medichini/AP/PA)

The policy follows a decade of efforts, first by Pope Benedict XVI and then Pope Francis, to clean up the Vatican’s murky finances and its reputation as an offshore tax haven with little or no expertise, oversight or accountability guiding investment decisions.

The Vatican’s financial practices attracted a broader spotlight when, in 2019, its prosecutors launched an investigation into the secretariat of state’s 350 million-euro investment in a London property, which lost the Holy See tens of millions in fees and commissions to brokers and other losses.

Ten people, including a cardinal, Italian brokers and former Vatican officials, have been on trial for a year on a range of alleged financial crimes.

Evidence presented at the trial showed the secretariat of state’s 600 million-euro sovereign wealth fund was essentially managed by one priest. Monsignor Alberto Perlasca recommended investments to his superior, who trusted the advice even though Monsignor Perlasca had little or no outside expertise.

He was originally a prime suspect in the investigation but became the prosecution’s star witness.

At one point, according to court documents and testimony, the Vatican considered investing 200 million euros in an Angola oil extraction deal. A decision was made against it and the money instead went toward converting a former warehouse of luxury department store Harrod’s into a luxury residential property.

At another point, the Vatican invested in a fund behind the Sir Elton John biopic Rocketman.

Even before the new policy was announced, Pope Francis had stripped the secretariat of state of its ability to manage its own money and ordered the assets to be transferred to the Administration of the Patrimony of the Apostolic See (APSA).

The APSA manages the Vatican’s real estate and other patrimony and is now responsible for overseeing the investment strategy for the entire Holy See.

Source link

About admin

Leave a Reply