Vatican official arrested on international money-laundering charges

June 28, 2013

A prominent Vatican cleric has been arrested on charges of attempting to bring €20 million (about $26 million) into Italy illegally.

Msgr. Nunzio Scarano, who until recently served as director of accounting for the Administration of the Patrimony of the Apostolic See (APSA), faces charges of corruption and fraud. He was already being investigated on suspicion of money-laundering.

Msgr. Scarano was one of 3 men arrested in connection with an alleged plan to bring the €20 million in cash into Italy. A financial broker, Giovanni Carenzio, allegedly arranged to provide the cash; Giovanni Maria Zitto, an Italian secret-service official, was to fly to Switzerland in a private plane to return with the funds. Msgr. Scarano had allegedly promised to pay Zitto €600,000 for transporting the cash.

Italian prosecutors had already taken an interest in what they described as the “enormous” financial assets of Msgr. Scarano. He had reportedly provoked suspicions by withdrawing €560,000 ($729,000) from his personal account at the Vatican bank, the Institute for Religious Works, and asking friends to accept cash and repay him with funds that he could deposit in an Italian bank. Those transactions triggered an investigation into possible violation of Italian money-laundering regulations.

Msgr. Scarano was suspended from his post at APSA—the office that handles the Vatican’s financial and real-estate assets—when he came under investigation on money-laundering charges. In a statement released after his arrest on the new counts, the Vatican “confirmed its willingness to cooperate fully” with Italian prosecutors in their investigation of the charges.

The Vatican bank, the IOR, also promised full cooperation with any probe, “in line with the zero-tolerance policy” promoted by the bank’s new president, Ernest Von Freyberg. The money-laundering probe involving Msgr. Scarano dates back to 2010, before a series of reforms at the IOR; the more recent charge for attempting to bring €20 million into Italy does not directly involve the Vatican bank.

Several media accounts of the Vatican official’s arrest incorrectly identified Msgr. Scarano as an officer of the IOR; although he held a substantial personal account at the IOR, he worked at APSA, a separate office. Other accounts inaccurately identified the accused cleric as a bishop from Salerno; he is in fact a priest of the Salerno archdiocese.

In addition to questions about his financial transfers, questions have been raised as to how Msgr. Scarano came into possession of such large sums. One Italian lawyer claimed that the cleric had collected funds from donors who were led to believe that they were providing support for an institution that would be built to serve terminally ill patients in Salerno.

 

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Further information:

• Vatican official arrested in corruption plot (AP)
• Press Release on Arrest of Curial Prelate (VIS)
• Vatican Bank Probe Leads to Three Arrests (Wall Street Journal)
• 'Huge' assets probe into Swiss money flight prelate (ANSA)
• 'Vatican money-transfer scam for tanker-fleet owners' (ANSA)
• Monsignor Nunzio Scarano held in Vatican bank inquiry (BBC)
• Vatican bank investigation snares bishop (USA Today)