VATICAN CITY — One major question about the upcoming Vatican trial regarding a London property deal that incurred massive losses for the Holy See is how much and when did top-level Vatican officials know about the transaction — and whether they, too, will be summoned to the trial.

A 488-page indictment published July 2 summons to trial 10 individuals — the most prominent is Cardinal Angelo Becciu, the former deputy secretary of state. The trial set to begin July 27 follows a two-year investigation into the London property deal.

The others subpoenaed are René Brülhart, former president of AIF, the Vatican’s supervisory and financial information authority; Msgr. Mauro Carlino, former secretary of Cardinal Becciu when he was deputy secretary of state; Enrico Crasso, a financial broker who managed investments for the Secretariat of State for decades; Tommaso Di Ruzza, former director of the AIF; Cecilia Marogna, a woman who received considerable sums from the Secretariat of State for intelligence services; Raffaele Mincione, a financial broker who allegedly made the Secretariat of State underwrite large shares of a fund that owned the London property; Nicola Squillace, a lawyer involved in those negotiations; Fabrizio Tirabassi, a notetaker in the administrative office of the Secretariat of State; and Gianluigi Torzi, a broker hired to help the Holy See exit the fund owned by Mincione.

Charges have also been made against four companies, three managed by Crasso and one by Marogna. But other senior officials who had overall responsibility for overseeing the transaction, including Cardinal Pietro Parolin, the Vatican secretary of state, and Cardinal Becciu’s successor, Archbishop Edgar Peña Parra, have not been summoned to the trial, nor has Msgr. Alberto Perlasca, head of the administrative office of the Secretariat of State, who signed a “shared purchase agreement” for the property on behalf of the Holy See.

Pope Francis, as the supreme judge of Vatican City State and the universal Church, would not be called to testify, although he remains free to choose to do so.

Cardinal Parolin was asked by the French Catholic daily newspaper La Croix on July 3 whether, as secretary of state, he would be asked to testify at the trial.

“I don’t know if I will be, but if I am asked, yes, I am ready to go. If they say, ‘You are responsible for everything that happened,’ I will undoubtedly have things to say, answers to give. If they think I’m not responsible, they certainly won’t call me to testify.”

Cardinal Parolin, whom Pope Francis appointed his No. 2 in 2013, said regarding the Secretariat of State’s involvement that “we consider ourselves victims” of the scandal. But he declined to comment on the merits of the case against the accused parties, as he had not yet had time to read the documents. He also said he hoped the trial would be “brief” and all the evidence would be provided. 

For his part, Msgr. Perlasca has always maintained that he acted on the orders of his superiors. 

 

2014 Origins

The London property financial scandal dates back to 2014, when the Holy See invested in a luxury apartment project in a prestigious area of the British capital using off-balance sheet funds taken from Swiss bank accounts under the control of the Secretariat of State. 

The investment ended up inflicting enormous losses on the Vatican, which were then compounded by further management errors that included the hiring of Italian financier Gianluigi Torzi, whom the Holy See asked to act as liaison for the final purchase of the London property in a failed attempt to further minimize losses. 

The overall total loss is believed to be around 200 million euro and possibly significantly higher, according to Italian media reports, and included “resources destined for the Holy Father’s personal acts of charity,” a Vatican summary of the indictment read. 

The summary, published by Vatican News on Saturday, said that neither Msgr. Perlasca, “nor his superiors” Archbishop Peña Parra and Cardinal Parolin, “had been effectively informed to be fully aware of the juridical effects” of the purchase agreement Torzi had drawn up for the Vatican. 

It added that Archbishop Peña Parra’s signature on that agreement was obtained “only after the fact and without the superiors being made aware” of a key part of the deal: that Torzi would have total voting rights over the property.

“To obtain control over the property and force Torzi out of the picture, 15 million euro was extorted from the Secretariat of State through payments to the broker for irregular reasons, thanks to the internal complicity of the suspects whom indictments have been requested,” the Vatican summary continued. 

One of those indicted, Msgr. Carlino, announced through his lawyer Salvino Mondello last November that his client had negotiated Torzi’s fee down from 20 million euro to 15 million. Mondello also alleged that Torzi’s hiring and payment were conducted “with the endorsement of the Holy Father.”

Cardinal Parolin has already emphasized that he worked closely with Cardinal Becciu in financial dealings, notably taking responsibility in 2019 for an irregular loan to purchase a bankrupt Rome Catholic hospital. He also attempted to limit further financial losses regarding the London deal, according to a letter leaked in January. 

 

Likely a Lengthy Trial

The hearing on July 27 is only the opening session of a trial that could last many months and is likely to be adjourned over the August summer break before resuming in the fall. Some observers say it is therefore quite possible that these officials and others could be summoned to subsequent hearings.

“As a result of evidence produced by the trial, additional actors inside or outside the Holy See could be indicted in the future,” said Matthew O’Brien, a Philadelphia-based Catholic investment manager who advocates for financial reform in the Church. He believes Msgr. Perlasca may have avoided a court summons because he has been cooperating with prosecutors in providing evidence against the 10 who have been subpoenaed. 

A Vatican source close to the legal process confirmed to the Register that Msgr. Perlasca, an Italian diplomat who worked in the apostolic nunciature in Buenos Aires from 2006 to 2008 when Cardinal Jorge Bergoglio was archbishop, has been helping the investigators, but “there’s no discussion at the moment” about whether he, Cardinal Parolin or Archbishop Peña Para will be summoned. 

Observers say the upcoming hearings will be beneficial to the universal Church. 

The trial is “great news for Catholics around the world,” said Opus Dei Father Robert Gahl, a founding board member of the Global Institute for Church Management. “It has long been suspected that the Vatican is infected by corrupt, greedy and power-hungry clerics, even if they are only a minority of those working selflessly in the Vatican.”

Father Gahl, an associate professor of ethics at the Pontifical University of the Holy Cross in Rome, told the Register that the trial is a fruit of Pope Francis’ financial and Curial reforms. 

The Holy Father, he said, has “reformed the law, both canonical and civil, to enshrine the principles of transparency and accountability in Church governance while reinforcing the prosecution in their ability to investigate crimes, bring to trial, ascertain the verdict, and impose a just sentence.” 

O’Brien similarly believes “lots of good could come from the trial,” but he said much will depend on whether the Vatican’s prosecutors — in this case, the Office of the Promoter of Justice — are able to operate “free from Curial interference” and whether state authorities mentioned in the indictment will cooperate. These include Italy, the United Kingdom, Luxembourg, the United Arab Emirates and the United States.

“The Vatican’s prosecutors do not have sufficient staff or experience to handle a complex financial fraud such as this entirely on their own,” O’Brien said, adding that a recent Italian court ruling against Torzi, combined with the comprehensiveness of the recent Vatican indictments, “suggest that Italian authorities at least are providing key support.”     

 

Judicial Double Standard?

O’Brien told the Register he would also like to see some rectifying of judicial double standards in which one standard of justice applies to senior prelates but another for lower-ranking priests and laity. 

One source with detailed knowledge and experience of Vatican finances told the Register that a “caste system” operates in the Curia, where prelates will protect one another while lower ranks are left to be held accountable. O’Brien therefore believes the Pope took an “important step” in reforming such a culture by revoking Cardinal Becciu’s privileges as a cardinal in 2019 and so allow him to be tried. 

Observers hope the trial could be a further step toward remedying such injustices. 

Father Gahl said, “Hopefully, the Pope’s reform, and specifically this trial, will bring forth the truth and effect justice, so that the faithful can be confident that their generous donations to Peter’s Pence will really go to the Pope’s charities and that the Vatican is renewed in effectively serving the entire Church’s desire for evangelization.”