Beginning of the end in Vatican financial trial
The Vatican’s chief prosecutor made a key concession during closing arguments, but insisted the case to convict remains sound
The sprawling trial into alleged financial crimes at the Vatican Secretariat of State entered its final phase this week, with prosecutors beginning their summing up arguments against the ten defendants.
The Vatican’s chief prosecutor made a key concession during closing arguments, when he admitted to the court that he had wrongfully asserted that a major financial deal was financed with money from Peter’s Pence.
Switching to a narrative in line with previous Pillar reporting, prosecutor Alessandro Diddi told judges that the money had actually come from profits of the IOR, a Vatican bank, deposited by the secretariat into Swiss banks.
Diddi, Promoter of Justice for Vatican City, opened his final turn before the court on Tuesday by reiterating that, despite the number of defendants from the Vatican’s premier governing department, he was not mounting a case against the Secretariat of State itself.
“This is not a trial of the Secretariat of State but of some officials, or rather 'servants,' who have not been able to interpret the spirit and ideals of the Church to adhere to in carrying out their profession,” he said.
Diddi went on to explain that the trial — which began with a 500-page indictment from prosecutors — was the result of a two-year long investigation, triggered by complaints from the Institute for Works of Religion (the Vatican City’s only commercial bank) and the office of the Vatican’s auditor general.
Those short complaints, which concerned an application for a loan by the secretariat to finance the now-famous London property deal, were made in 2019, Diddi said, and had led to the discovery of the “existence of very serious crimes,” including those allegedly committed by the former sostituto at the Secretariat of State, star-defendant Cardinal Angelo Becciu, who is accused of fraud, embezzlement, abuse of office, conspiracy, and attempting to pervert the course of justice.
The chief prosecutor also told the court that, despite claims made in Italian media, his office had not opened its investigation with either an initial working “theory” of systemic corruption within the secretariat, or with the aim of targeting specific officials within the department.
Becciu has previously claimed in court that he is the victim of a witch hunt and a trial by media.
“The start of the investigation brought us up to today,” Diddi said, but began “without [us] knowing where we would end up.”
The prosecutor told the judges that he and his team “didn't have any kind of preconceived idea” of what they might find as they pursued their investigation.
Diddi conceded in court that some of his department’s initial conclusions had been wrong, including the suggestion that the hundreds of millions of euros invested with financier Raffaele Mincione had been drawn from donations to the annual Peter’s Pence collection.
While that theory was circulated by prosecutors and media outlets and is the subject of lawsuits by Mincione in several other jurisdictions, independent reporting has long established that the 200 million euros invested by the Secretariat of State with Mincione came instead from loans from Swiss banks leveraged against Church assets on deposit there and obscured from Vatican auditors via prohibited accounting procedures.
That reporting was initially denounced as “shameful,” “misleading,” and “FALSE” by Cardinal Becciu in 2019, a year before his forced resignation from office and subsequent criminal indictment.
In his “Prison Journal,” published in 2021, Cardinal George Pell, the former prefect of the Vatican’s Secretariat for the Economy who died in January of this year, called the same reporting an “accurate account” of events, while noting Becciu’s “furious” denials.
Acknowledging his initial misstep, Diddi said Tuesday that the prosecution’s case was still sound.
“I think the prosecution [case] held,” Diddi said. “The facts held, otherwise it would have been a big defeat for us if the facts - as reconstructed - weren't constructed correctly in some way.” Instead, Diddi told the court, the evidence presented during the trial, which began in July of 2021, “ringed together” a pattern of criminal activity by secretariat officials and advisors between 2012 and 2019.
In a nod to that same reporting’s conclusions, Diddi said it was now clear that “Thanks to assets managed outside the rules, it was possible for years [for officials] to circumvent the rules. Not randomly but for their own advantage.”
Tuesday’s hearing, the sixty-second meeting of the trial, is the first of six sessions during which the prosecution will present its closing arguments, before turning over to defense lawyers after the August summer break.
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Diddi also addressed Tuesday the significance of Msgr. Alberto Perlasca to the prosecution’s case.
Perlasca was, for years, head of the secretariat’s administrative office and the immediate subordinate of Cardinal Becciu.
Diddi dismissed the characterization of Perlasca as a kind of “super witness” but instead said the monsignor is a “very fragile figure” who had given an “up-and-down” report of alleged crimes in the secretariat.
Addressing questions about Perlasca’s own apparent involvement in covering up potentially criminal financial dealings at the secretariat, Diddi defended the decision not to include the priest among the list of ten defendants, saying he appeared to investigators “to be a victim rather than a participant” in the alleged crimes of his superiors.
In addition to details about the London property deal, Perlasca also provided crucial information to prosecutors about secret transfers of large sums of money ordered by Cardinal Becciu to Cecelia Marogna, a self-described intelligence and security expert also facing Vatican charges for embezzlement of half a million euros sent to her by Perlasca on Becciu’s orders.
According to leaked footage of Perlasca’s interviews with Vatican prosecutors, the monsignor confirmed that, acting on instructions from Becciu, he helped arrange money transfers amounting to more than half a million euros to Cecilia Marogna, the self-styled geo-political analyst who claims to have worked as a personal spy for Becciu while he was at the Secretariat of State.
On one occasion, Perlasca said, he prepared an envelope with nearly 15,000 euros in cash for the cardinal, but that he did not know to whom the money was going — only that Becciu told him the transfers had been approved by Pope Francis personally.
During the trial, it emerged that Becciu made several attempts to convince Pope Francis to intervene in the case and excuse the cardinal’s actions, including by an exchange of letters.
Perlasca told Vatican prosecutors that Becciu “became very angry” with him for discussing the money transfers, and had demanded to know why he had not deleted records of the transactions from secretariat records.
In addition to prosecution charges that Becciu attempted to suborn Perlasca’s testimony, the cardinal sued the priest in Italian civil court, seeking half a million euros from his former deputy at the Secretariat of State as damages for injury to the cardinal’s health and lifestyle following Perlasca’s cooperation with Vatican investigators.
An Italian appeals court rejected Becciu’s claims and threw out the suit, finding that there was “no concrete harmful conduct in the plaintiff's narrative” and that Becciu’s claims of harm were “completely lacking in any, albeit approximate, quantification” which would justify the damages being sought.
Becciu was ordered to pay ten of thousands of euros in court costs and legal fees.
Diddi told the judges Tuesday that Becciu had not originally been a suspect or the target of their investigation, but had brought himself into focus when he “tried to interfere in the investigation.”
“We discovered [Becciu’s interference] from Perlasca's mobile phones, from the very first chats that have followed one another since the search of 1 October 2019 in the offices of the Secretariat of State,” Diddi said.
Becciu “intruded heavily on the conduct of investigations, [put pressure] on defendants to show solidarity [with him] and also was able to activate press campaigns against the magistrates who were carrying out the investigations,” said the chief prosecutor.
Becciu has denied all allegations against him.
In comments sent to The Pillar on Wednesday, a spokesman for the cardinal’s legal team said that prosecution’s performance “demonstrated the total lack of linearity of the accusations which, in an attempt to defend its investigation against the cardinal, collapsed during the trial, omitted evidence and disputes to give space to suggestions and ethical and moralistic judgments even on the ways in which the cardinal defended himself.”
“One wonders what 63 hearings were for,” the cardinal’s lawyers said.
“The cardinal has suffered for over two years a very heavy, unprecedented media pillory,” the statement from Becciu’s legal team said. “And for many months some newspapers have disfigured the Cardinal's image with accusations that did not even concern the investigation.”
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Over the course of the trial, defense attorneys have repeatedly raised questions about the integrity of the process, filing numerous procedural objections which were dismissed by the judges.
The court has also heard evidence from serving senior officials related to the use of surveillance through outside contractors and advisors to the secretariat, as well as admissions by officials that they ordered retaliatory investigations into whistleblowers.
Diddi, who will resume his arguments July 19, told the court on Tuesday that the trial had become a test of the integrity of the Vatican’s legal and judicial credibility and expressed his “appreciation for the difficult work of the Court” which had shown “the resilience of the judicial system.”
On July 19, the prosecutor is expected to address the charges against the former leadership of the Financial Information and Supervisory Authority, the Vatican’s financial watchdog. Both the former president and director of the agency are defendants in the trial.
Prosecutors are expected to finish their arguments next week, the trial remains ongoing.
Editor’s Note: This story has been updated to include comments from the legal team of Cardinal Becciu, recieved after publication.
“The cardinal has suffered for over two years a very heavy, unprecedented media PILLORY,” the statement from Becciu’s legal team said.
Pillar-y. Get it?
The amount of convoluted financial and political moves you have had to piece together makes my head swim, even when you try to simplify it down for us lay (legally speaking) folk. Thank you, Ed, for you dedicated and honest coverage from primary sources of this issue from the start. What you have done and are doing is of invaluable importance to the whole church, from the curia to the least of the lay people (i.e. myself and others like me). I pray that the truth does out in this process, and if it does it will be in no small part due to you're hard work. I consider it a great honor to be able to support you in this work, even if only by a small monthly payment.