The next Vatican scandal

By Phil Lawler (bio - articles - email) | Jun 10, 2016

Another scandal is brewing at the Vatican.

This time the subject will not be sex, but that other rich lode of corruption: money.

Shady deals at the Vatican bank, the Institute for Religious Works (IOR), have brought disgrace on the Holy See in the past (if you don’t know what I mean, search on “Roberto Calvi”), and more conventional problems in the past few years (try “Nunzio Scarano”). But now the IOR is under new management, run by lay professionals, and appears fully committed to transparency.

Unfortunately the offices of the Roman Curia are not ready to make the same commitment. Today’s announcement that the Vatican will not proceed with an external audit, but rely instead on internal controls, represents a victory for the sort of halfway disclosure that Richard Nixon characterized as the “modified, limited hangout”—a commitment to (as one high-ranking Vatican official put it) “full accountability, yes, but let’s keep our problems in-house.”

In today’s announcement the Vatican press office took special pains to deny the charges made by some analysts that the audit by PricewaterhouseCooper had been suspended because some Vatican agencies (notably the Secretariat of State) were dragging their feet on financial disclosures. “The commitment to the economic-financial audit of the Holy See and of the State of Vatican City has been, and remains, a priority,” the statement insisted.

A priority, perhaps. But not a top priority. The statement indicated that while the internal audit would go forward, the services of PricewaterhouseCooper “will also be available to those dicasteries that wish to avail themselves of its support and consulting services.” In other words the people who are being audited will determine how far the external auditors should delve into the records.

Does that sound to you like a prescription for transparency? To me, it sounds ominously similar to the approach that many Catholic bishops took to problems of clerical abuse: a determination to handle problems quietly, to avoid a public fuss. It’s an approach doomed to failure. Sooner or later the ugly facts come out, and the uproar is far greater for having been repressed; the scandal is worse because of the awkward attempts to suppress it.

Ironically, the worries of the Secretariat of State about the external audit—the fears of compromising the sovereignty of the Vatican city-state—are closely connected with the response to the sex-abuse scandal. For the last several years a capable American lawyer, Jeffrey Lena, has been fighting off efforts by sex-abuse victims to bring suit against the Vatican. A sovereign state can claim immunity to such lawsuits. And a sovereign state—as the June 10 announcement by the Vatican press office reminded us—does not open its books to an external auditor.

But there’s a price to be paid for sovereign immunity. Does the Holy See wish to be seen by the world primarily as a sovereign state, or a spiritual stronghold? It’s ironic that under Pope Francis—who has spoken so frequently about the “Church that is poor,” and Vatican reform, and dismantling the fiefdoms of the Roman Curia, and even a willingness to “make a mess”— the institutional prerogatives of the Vatican bureaucracy might be seen to take precedence over the evangelizing mission.

Phil Lawler has been a Catholic journalist for more than 30 years. He has edited several Catholic magazines and written eight books. Founder of Catholic World News, he is the news director and lead analyst at CatholicCulture.org. See full bio.

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Show 3 Comments? (Hidden)Hide Comments
  • Posted by: Frodo1945 - Jun. 15, 2016 9:29 AM ET USA

    Show me the money!

  • Posted by: unum - Jun. 14, 2016 6:05 PM ET USA

    Where is the Holy Father on this issue. The silence is deafening!

  • Posted by: pja - Jun. 14, 2016 5:45 PM ET USA

    I think I made this comment before. Any time an audit is suspended, canceled, etc. it means someone somewhere has something serious they don't want others to see. As a young CPA my first assignments were on S&Ls back in the mid 1980s. I saw a lot of good people (yes, including the external auditors)make dumb decisions and then try to cover up and rationalize. It was an eyeopener.