VATICAN CITY — Last year was an exceptional one in the church business, if the Holy See’s balance sheet is any indicator. The 2014 annual report released Monday shows the Vatican’s bank, officially known as the Institute for Religious Works, or IOR, turned a profit of more than $72 million—more than 20 times more than it made in 2013. And that sounds like good news, but there are several dark sides to this story.
The bank has been, for decades, embroiled in unseemly scandals that have run the gamut from allegations of money laundering to backchannel Mafia ties. The bank’s credit card capabilities were briefly shut down in 2012 because of noncompliance with European Union money-laundering standards, which meant that tourists had to dole out cash to visit the Vatican museums or buy holy trinkets on the premises.
All that changed under Pope Francis, who vowed to clean out the bank’s dead wood and offer greater transparency. In the last year alone, 4,614 accounts were closed, either because they had been dormant for years or because the account holders didn’t meet the new standards set by IOR’s crack team of reformers. Another 2,000 accounts face closure this year.
A lot of the profits made in 2013 went to external auditors who set up temporary shop in the bank’s medieval tower headquarters inside the fortified walls of Vatican City to comb through the murky bookwork. Based on the 2014 final report, it was money well spent. “The main focus is on fundamentally improving our overall client service standards and further professionalizing our asset management services,” IOR chief Jean-Baptiste de Franssu said in a statement.
The clientele now consists primarily of religious institutions and current and former Vatican employees who undoubtedly appreciate that their bank is no longer considered a money-laundering factory.
There is little doubt that at least part of the turnaround cleaning up the Vatican bank will be credited to Australian Cardinal George Pell, who was appointed by Pope Francis as prefect of the Secretariat for the Economy in 2014 after the pontiff toyed with the idea of shuttering the financial institution entirely. “St. Peter didn’t have a bank account,” Francis declared shortly after his election in 2013. “I don’t know what will become of the bank. Some say it is better that it is a bank, others that it should be a charitable fund, and others say close it.”
Shortly after taking on the challenge, Pell announced that hundreds of millions of euros had been “tucked away” in obscure accounts, hidden from plain view because of bad habits. “Reforms are well under way and already past the point where the Vatican could return to the ‘bad old days,’” he said.
Despite the obvious good news, Pell’s success at the helm of the Vatican’s economic reforms may soon cause serious problems for Francis. Pell is under scrutiny in his native Australia for his role in shuffling pedophile priests to protect them in a case that, despite countless examinations, just won’t go away.
Last week, David Ridsdale, the nephew of a convicted pedophile priest, testified before the Royal Commission into Institutional Responses to Child Sexual Abuse in Australia that Pell had bribed him to keep quiet about sexual abuse against children. Ridsdale recounted a conversation he allegedly had with Pell more than 30 years ago:
Ridsdale: “Excuse me, George, what the fuck are you talking about?”
Pell: “I want to know what it will take to keep you quiet.”
Ridsdale: “Fuck you, George, and everything you stand for.”
Pell, who is under pressure to return to Australia to address the commission personally, said in a statement that while he felt sorry for the victims, the allegations of bribery are trumped up. “To the best of my belief this conversation did not happen,” he said. “I was and remain extremely sympathetic to David Ridsdale, who because of his uncle suffered horrible abuse. I continue to regret the misunderstanding between us. At no time did I attempt to bribe David Ridsdale or his family or offer any financial inducements for him to be silent.”
Sex-abuse survivors disagree with Pell’s recollection of the event. “George Pell has long been regarded as Rome’s man in Australia, which necessarily involves prioritizing the interests of Rome above everyone else,” Nicky Davis of the Australia chapter of the Survivors Network of Those Abused by Priests, or SNAP, told The Daily Beast. “More and more Australian Catholics strenuously disagree with Pell’s response to child sex crimes by clergy, but their views, like the cries for help of victims, are ignored.”
Davis says that Pell also was accused of abusing minors back in the 1960s when he was a young priest. According to the Broken Rites website that chronicles alleged clerical sex abuse in Australia, Pell, during some form of activity in a tent such as pillow fighting or wrestling, “put his hand down the inside of the complainant’s pants and got ‘a good handful’ of his penis and testicles.”
Pell denies those allegations as well and says he has been cleared of all accusations of sexual wrongdoing. Davis says those allegations were never actually investigated by police. “Instead it was dealt with via an internal investigation paid for and answering to the Catholic Church,” she says. “The accuser was judged to be telling the truth, but there was insufficient evidence to overcome Pell’s denials and his overwhelming power and influence. Pell claims to have been exonerated, but this is not true.”
The increasing pressure for Pell to again face his accusers at home stands in obvious stark contrast to the accolades he is receiving in Rome for his work cleaning up the bank. “When Pell moved to Rome, Australian survivors and many others believed he was fleeing the country to escape accountability,” Davis says. “Francis can allow Pell to remain in Rome, safe from the reach of Australian authorities, or he can retain any shred of credibility that he intends to put an end to covering up child sexual violation by clergy. He cannot do both.”