Italy: The Great Vatican Bank Mystery

[BridgeTheGap]

A tale of two deaths, twelve investigations and missing millions

Two suicides, both of which could conceivably be murder. As much as $1.2 billion in unsecured loans. The failure of Italy's huge Banco Ambrosiano, which has left more than 200 international financial institutions holding the bag for millions in loans. A scandal that has threatened the stability of the entire international banking system and has begun to bring about subtle changes in the way the world's major banks do business. A secret plot to undermine the government of Italy and to change the shape of politics in several Latin American countries.

Even if these were the only ingredients, the story would still be intriguing enough for a Robert Ludlum thriller. But an added element is making the scandal that has rocked the world of international finance one of the most compelling real-life mysteries of the century: the involvement of the Istituto per le Opere di Religione (I.O.R.), better known as the Vatican bank.

Founded in 1942 to invest and increase the funds given to the Holy See for religious works, the I.O.R. is much like any other international commercial bank. It accepts savings and checking accounts, transfers funds in and out of the Vatican and makes investments. There are, however, some interesting differences in the bank, which is tucked away in the medieval tower of Sixtus V. Depositors must be connected with the Vatican. The list of those eligible includes members of the Curia (the Pope has a personal account, No. 16/16), the 729 permanent residents of Vatican City, and a small group of clergymen and laymen who have regular business dealings with the Vatican. No others need apply. The bank's assets are thought to be modest by international standards. For that reason, the scandal is especially threatening to the I.O.R.: Italian authorities say the bank may be liable for much of the millions the Banco Ambrosiano Group owed to international banks.

Read more: http://www.time.com/time/magazine/article/0,9171,951806,00.html#ixzz1Z4MBK7QP

[gateley]

1. Bookmarking - have to head to work but sounds interesting thus far! nt

[emcguffie]

6. You notice this is from 1982, yes? N/t

[gateley]

8. No - didn't look at it that closely as I was heading out the door -- thanks! nt

[midnight]

2. Of course the Vatican bank President under suspicion has to be American born.

[ensho]

3. kick

nt

[broiles]

4. Isn't this old news?

The article keeps referring to Pope John Paul in the present tense.

[smaug]

5. Old news, but in today's context, informative

David Yallop wrote a book on the papacy of John Paul I, in which the Banco Ambrosiano played a significant role. The way the Vatican bank moved funds around presages the way that our contemporary banking system without the regulation of Glass/Steagall operates.

Amazingly, history IS important. Note the lack of emphasis on history/economics and context in our political leaders focus on standardized test scores....

[emcguffie]

7. FYI, this is from 1982.

I guess you noticed, but I don't think others did or will.

Sorry for the reply to the wrong post below.

It does raise the question, what ever happened to Paul Marcinkus?