Will compulsion succeed where conversion has failed on Vatican financial reform?

John L. Allen Jr.Crux Now Feb 18,202

ROME – When Pope Francis recently addressed the ongoing financial reform of the Vatican, he couched the argument in largely spiritual, pastoral and moral terms.

Financial breakdowns recently brought to light, the pope said, “beyond their possible criminality, are hard to reconcile with the nature and purpose of the Church, and they’ve created confusion and worry within the community of the faithful.” He was speaking to Vatican judges on the occasion of the opening of their judicial year.

Though the pope avoided specifics, the reference almost certainly was to a recent contretemps involving a $220 million land deal in London (mostly financed by collections from Peter’s Pence) in which the Vatican’s Secretariat of State allegedly tried to skirt reporting requirements for a loan intended to buy up the remaining shares of the property.

That’s an especially alarming development, given that the Secretariat of State also bears the lion’s share of responsibility for enforcing the Vatican’s own accountability and transparency measures.

Francis is indisputably right that such shenanigans are tough to square with the Church’s moral teaching or the clear injunctions of the Gospel. Yet the hard truth is that such contradictions, by themselves, rarely have been enough to spur real reform. Instead, the Church tends to react in most compelling fashion only when facing some external threat.

The rise of the great mendicant orders, for instance, came in response to the rapid urbanization of the high Middle Ages and the threat of losing the city poor. The Council of Trent, and the internal housecleaning it unleashed, were driven by the Protestant Reformation and the loss of half of Europe.

So, what’s the threat the Vatican is facing today? In a word, here it is: Money.
When Francis was elected on a reform mandate almost seven years ago, cardinals were motivated in part by a suspicion that in financial terms, the Vatican’s ship was taking on water. That’s really all it was back then, a suspicion, since no one actually knew how much money the Vatican was losing, but there was a palpable sense something was amiss.

Since then, the reality of the situation has become steadily more apparent. The Vatican is carrying a bloated and unsustainable payroll, it has extensive real estate holdings that return virtually no profit, and it faces a looming pension crisis which, if left unaddressed, could produce a financial Chernobyl all by itself.

Last October, Italian journalist Emiliano Fittipaldi predicted that the Vatican would be bankrupt by the year 2023.

Despite the reassuring tones of Bishop Nunzio Galantino, Francis’s handpicked chief of the Administration of the Patrimony of the Apostolic See (APSA), that there’s no risk of going broke and all that’s needed is a spending review that’s already underway, many insiders will tell you that Fittipaldi’s projection isn’t that far off unless something dramatic changes.

Added to that already alarming scenario is the threat that due to the recent cycle of scandals and departures of key personnel associated with the reform cause, the Vatican could return to global “blacklists” of suspicious financial actors. Should that happen, it would become much more difficult for the Vatican to access international currency markets, and it would face significantly enhanced transaction costs as banks and regulators insist on rigorous due diligence measures to process any Vatican money.

That threat of returning to semi-pariah status is hardly theoretical, since this spring the Vatican faces its next round of review by Moneyval, the Council of Europe’s anti-money laundering agency and the primary gatekeeper for European states to global “whitelists” of virtuous actors. In theory, should Moneyval conclude that the Vatican is backsliding on its stated commitment to reform, failing to enforce the ambitious new laws on transparency and accountability adopted under Pope Francis, it could lead to censure from the Financial Action Task Force, the global network of anti-money laundering evaluators.

If you ever wonder whether such denunciations make any difference, consider the example of Liechtenstein. Once considered a classic example of a rogue nation, Liechtenstein was hit with a series of FATF sanctions in the late 1990s that took a significant toll.

According to the 2011 book The Money Laundry by J.C. Sharman, from 2000 to 2002 the net income of banks in the tiny country fell from $560 million to $255 million, tax collections on banking activity plummeted from $65 million to $27 million, and assets managed dropped from $114 billion to $97 billion.

“It was a real disaster,” one official was quoted as saying. “Our foundations trembled.”

The fallout got the attention of Liechtenstein’s bankers, and they cleaned up their act. (Ironically, Swiss lawyer René Brülhart, recently forced out as head of the Vatican’s Financial Information Authority, made his reputation as director of Liechtenstein’s financial intelligence unit from 2004 to 2012, where he spearheaded the clean-up operation.)

If Pope Francis truly wants change on Vatican finances, in other words, perhaps he shouldn’t put all his eggs in the basket of metanoia and personal conversion, however desirable those things obviously are.

Maybe what he really needs right now is somebody to put a gun to the head of the system … and, as fate would have it, Moneyval may be ideally positioned to do just that very soon.

Follow John Allen on Twitter: @JohnLAllenJr


The bankruptcy of the Vatican will be a step in Gods will for its reform.

Corruption sets in where there is power, fame and money.

God removes power when he wants to reform.

I find it hard to believe that the RCC can ever be reformed.

But if it ever happens it will be through total humiliation and annihilation.



by Clifford Longley The Tablet Thousands of transgender people and their supporters take part in London’s first ever Trans Pride march through London, Sep 2019 Photo: WIktor Szymanowicz/NurPhoto/PA Images St Valentine’s Day may not be the ideal moment to meditate on the relationship between sex and gender, except perhaps to cry “Vive La Différence!” But it can’t be escaped. The Government is conducting a consultation on reform of the law, and the controversy over transgenderism has come up repeatedly in the Labour leadership hustings. All four candidates have been asked if they would support a reform of the law to allow people to chose their own gender, without first having to comply with medical or psychological criteria. With minor reservations, all four said they would. There is a undoubtedly a strong current running in that direction, by no means only on the left. My only qualification for offering an opinion on the matter is that of someone who was, a long time ago, a male single parent of three children. A family household without an adult female could not function within a normal – that is to say, more or less traditional – set of rules about gender roles. I was brought up within those rules, and never questioned them until I had to. Indeed since university I have often rued that it seemed to be the ugliest men who got the prettiest girls (not being particularly ugly myself). I read somewhere that a woman’s largest sex organ is her skin, covering her whole body. I doubt that could ever be said of a man. My main conclusion is that for the vast majority of the population, including myself, gender is not fluid. It is stable and we are comfortable with it. I did not condition my son into being male nor my daughters into being female. There were no other options, nor did we want any. But it is an undoubted fact that there are some who are born male who devoutly wish to be female. They are not feminised men – they are hard-wired so that their image of themselves does not fit the category they were assigned to at birth. Their sex and their gender do not match. This is mysterious, but it is what nature has done to them and ought to be respected. I do not think it has anything to do with masculinity or femininity, which, as I have said, are social constructs. And I do not know – and I am not sure anybody does – what all this has to do with sexual orientation. In other words a transgender person can be gay or straight (though those expressions may need more careful definition than we usually give them). The major problem that has been raised by the campaign for the rights of transgender persons to self-identify concerns those who were born male and still have all the male sexual apparatus, but who wish to identify as female prior to or apart from the appropriate surgical procedures. They wish to have access to exclusive female facilities such as public toilets. Unsurprisingly, not all women like the idea. It is unhelpful simply to dismiss that attitude as “transphobic bigotry”. In theory at least, a sexual predator with fully functioning male reproductive organs could enter a place reserved for women, just by claiming to be one. I, a father of girls, would strongly oppose that. Penises, erect or flaccid, do not belong in female toilets. They can be instruments of sexual violence. In such a setting, they are threatening. The other problem with gender self-identification is in competitive sport. Penises come with testicles, and testes produce testosterone, the predominantly male sex hormone. It is established medical understanding that testosterone is what triggers puberty in boys, and they then grow on average taller and stronger than girls of the same age, along with other changes. So an adult transgender female – formerly male – will still have years of development behind her under the influence of a normal male level of testosterone. She will still be taller and stronger than a non-transgender female of the same age. The problem isn’t solved by imposing limits on her testosterone levels now or in her recent past, as some of the governing bodies of sport are doing. She doesn’t shrink to a smaller size and shape as a result. It isn’t her levels of testosterone now that makes her faster and stronger. It is the levels throughout her past life. So it is likely she will outperform non-transgender women. Is that fair? How sporting bodies solve this is their problem, but it won’t be sorted be hurling insults around. These issues raise strong emotions, which makes their calm discussion difficult. Significantly, all the Labour leadership candidates agreed that they do need to be discussed, and that there are difficult areas. That surely implies that there have to be some limitations to self-identification, for the good of all sexes and genders including those in transition. But otherwise, why can’t we all just live and let live? PAT SAYS The writer has presented us with food for thought. And he is right to call for live and let live. But when it comes to the NHS and treatment life saving treatments for cardiac, neurology and organ donation should take precedence over sex change ops, in my opinion. MY PECTORAL CROSS There were some comments on the blog yesterday about my pectoral cross – calling it ostentatious and very Catholic. It is not ostentatious. It is made of iron and is silver plated. It was bought on Ebay in its iron form for £40 and the silver plating cost another £20. It was designed and made by a prisoner in Auschwitz – and that is its principle attraction to me. It shows, on one side the crucified Jesus and above him the Father”s sending the Holy Spirit. On the reverse in German, is the prayer from the Mass: It is unashamedly Catholic. I am a Catholic. Not a Roman Catholic but a Catholic. The Catholic Church is greater than the RC denomination.