Vatican official in $33m fraud case

Convoluted operation involved planes, secret service agents and mortgage on coastal home

A Vatican official already under investigation in a purported money-laundering plot involving the Vatican bank was arrested yesterday in a separate operation. Prosecutors allege he tried to bring €20 million ($33.4 million) in cash into Italy from Switzerland aboard an Italian Government plane, his lawyer said.

Monsignor Nunzio Scarano, a recently suspended accountant in one of the Vatican's main financial departments, is accused of fraud, corruption and slander stemming from the plot, which never got off the ground, attorney Silverio Sica said.

He said Scarano was a middleman in the operation: friends had asked him to intervene with a broker, Giovanni Carenzio, to return €20 million they had given him to invest.

Sica said Scarano persuaded Carenzio to return the money, and an Italian secret service agent, Giovanni Maria Zito, went to Switzerland to bring the cash back aboard an Italian Government aircraft. Such a move would presumably prevent any reporting of the money coming into Italy.

The operation failed because Carenzio reneged on the deal, Sica said.

Zito, nevertheless, demanded his €400,000 commission. Scarano paid him an initial €200,000 by cheque, which Zito deposited, Sica said. But in a bid to not have the second cheque deposited at the bank, Scarano filed a report for a missing €200,000 cheque, even though he knew Zito had it, Sica said.

Carenzio and Zito also were arrested yesterday along with Scarano, Sica said.

It's not the only troubles facing Scarano. Prosecutors in the southern city of Salerno have placed him under investigation for alleged money-laundering stemming from his account at the Vatican's bank, the Institute for Religious Works.

Just this week, Pope Francis named a commission of inquiry into the bank to get to the bottom of the problems that have plagued it for decades and contributed to damaging the Vatican's reputation in global financial circles.

That investigation concerns transactions Scarano made in 2009 in which he took €560,000 in cash out of his personal IOR bank account and carried it out of the Vatican and into Italy to help pay off a mortgage on his Salerno home.

To deposit the money into an Italian bank account and to prevent family members from finding out he had such a large chunk of cash he asked 56 close friends to accept €10,000 apiece in cash in exchange for a cheque or money transfer in the same amount, Sica said earlier this week. Scarano was then able to deposit the amounts in his Italian account.

The original money came into Scarano's IOR account from donors who gave it to the prelate thinking they were funding a home for the terminally ill in Salerno, Sica said. He said the donors had "enormous" wealth and could offer such donations for his charitable efforts.

He said Scarano had given the names of the donors to prosecutors and insisted the origin of the money was clean, that the transactions didn't constitute money-laundering, and that he only took the money "temporarily" for his personal use.

The home for the terminally ill hasn't been built, though the property has been identified, Sica said.

"He declares himself absolutely innocent," Sica said of the Salerno investigation.

The Vatican spokesman, the Rev Federico Lombardi, said earlier this week that the Vatican is taking the appropriate measures to deal with Scarano's case.


- NZ Herald

Get the news delivered straight to your inbox

Receive the day’s news, sport and entertainment in our daily email newsletter


© Copyright 2017, NZME. Publishing Limited

Assembled by: (static) on production bpcf02 at 29 Mar 2017 16:23:17 Processing Time: 484ms