The Vatican auditor resigns—another crushing blow for financial reform

By Phil Lawler ( bio - articles - email ) | Jun 20, 2017

You don’t have to be Sherlock Holmes to follow the sequence of events leading up to the resignation of the Vatican’s auditor general Libero Milone.

In May, Milone and Cardinal George Pell co-signed a letter to Vatican officials, telling them that they need not comply with a directive from the Administration of the Patrimony of the Apostolic See (APSA). That letter was an unmistakable sign of a turf battle between APSA and the Secretariat for the Economy, the office with which Milone was associated. When there’s a bureaucratic infighting, followed by an abrupt resignation, it’s easy to tell who won the battle.

Oddly enough, the focus of the battle was auditing. You might think that when Milone was appointed auditor general, and promised full autonomy, he would have unquestioned control of the Vatican’s auditing procedures. Not so. This year APSA instructed Vatican officials to furnish financial information to PricewaterhouseCoopers; APSA explained that the firm was conducting an outside audit of all Vatican financial affairs. This was the initiative to which Cardinal Pell and Milone took exception.

The APSA directive was odd for two reasons. First because the auditor is, after all, the auditor; any such request for financial information should have come from Milone. Second, because just a year earlier, Vatican bureaucrats had managed to scuttle a thorough outside audit which was to have been conducted by the same firm, PricewaterhouseCoopers, under the auspices of the Secretariat for the Economy.

Why would entrenched Vatican bureaucrats be comfortable with an audit done for APSA, but not an audit done for the Secretariat for the Economy? Perhaps because APSA has been handling Vatican financial affairs for years, and veteran staffers are comfortable with APSA’s approach. Too comfortable, in fact. Remember when Cardinal Pell uncovered “hundreds of millions of euros” in off-budget transactions?

APSA’s own record for financial transparency is not impressive. Remember Msgr. Nuncio Scarano, the infamous “Monsignor €500”? Before his arrest on money-laundering charges he had been APSA’s director of accounting. Remember the “Vatileaks” exposés about sweetheart deals in the Vatican’s real-estate holdings? You guess it: APSA is the office that administers the Vatican’s real estate.

These missteps do not prove that APSA is corrupt. They do, however, strongly suggest that if you want accountability and transparency in Vatican financial affairs—if you want to break down the old-boy network that makes corruption possible—you don’t want APSA in charge. You want a tough, independent auditor.

Unfortunately the man you want just walked out the door.

More than a year has passed since I wrote that The drive for Vatican reform has stalled. Last September the Wall Street Journal agreed that the declining clout of Cardinal Pell was “a setback for the financial overhaul” and “a sign that the Vatican’s established interests have gained the Pope’s support.” So now, four years into the administration of a Pontiff who was elected with a mandate for Vatican reform, the hope for genuine reform seems more remote than ever.