State Secretariat lawyers challenge Becciu criminal defense

A Vatican lawsuit could impact Cardinal Angelo Becciu's criminal trial

To defend itself from a lawsuit, the Vatican Secretariat of State made an argument Wednesday that could cause problems for the criminal defense efforts of former secretariat official Cardinal Angelo Becciu.  

The secretariat’s lawyers argued that since 2015, the department’s finances were subject to oversight from the Vatican’s auditor general, who was appointed by Pope Francis.

The problem?

In his criminal trial, Cardinal Angelo Becciu has argued the opposite.

Libero Milone, former auditor general of the Vatican. Pillar file photo.

Lawyers for the Vatican Secretariat of State argued in court Oct. 18 that that the Holy’s See’s auditor general held legal oversight of the secretariat’s financial affairs, from the time an auditor was appointed in 2015. 

The concession came during the closing hearing of a lawsuit filed against the department by Libero Milone, the former auditor general of the Vatican, who was forced to resign in 2017 after being accused by Cardinal Angelo Becciu of “spying” on the private financial affairs of senior curial officials.

Secretariat lawyers argued that since the auditor’s office was created by Pope Francis, the secretariat is not liable for the circumstances of Milone’s dismissal.

But to lay out its case for dismissing the lawsuit, the secretariat’s legal team undercut Becciu’s defense claims in the former sostituto’s own dispute with Milone, and in the cardinal’s ongoing criminal trial.

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Libero Milone was appointed by Pope Francis in 2015 as the first auditor general of the Vatican and worked closely with Cardinal George Pell, who was named the first prefect for the Secretariat for the Economy by the pope, until 2017.

In that year, Pell was forced to take a leave of absence from his role to successfully defend himself against abuse accusations in his native Australia, while Milone was forced from his position that same year, along with his deputy, Ferruccio Panicco. 

Both auditors claim they were ousted because they had been too successful in uncovering financial corruption at the highest levels of the Vatican.

They filed a claim for wrongful dismissal in November this year, seeking more than 9 million euros in damages and lost income.

As part of the pre-trial process in the lawsuit, Panicco and Milone filed several hundred pages of documents, which they said proved they discovered widespread corruption among senior curial officials at the Vatican, and supported their contention that they were forced from office.

Pannico died earlier this year after a long battle with cancer, a condition he argued in his lawsuit was exacerbated and made fatal by the seizure of his private medical records by Vatican gendarmes.

At the time of their ouster, then-sostituto Cardinal Angelo Becciu said Milone had been made to resign under threat of criminal prosecution because he was “spying” on the private financial affairs of senior officials, including Becciu himself.

The dispute hinges on what happened after Pell’s department decided to enforce a curia-wide audit of all Vatican finances. 

The Secretariat of State under Becciu became the locus of resistance to that move, with the cardinal issuing an order canceling a planned external audit and moving to block oversight of his own department’s financial affairs.

Both Pell and Milone have said Becciu initially cooperated with their efforts to audit the Secretariat of State, but became confrontational after they discovered a series of loans and investments obscured from departmental ledgers using accounting practices prohibited under Vatican financial law.

Among those investments was the London property deal, the exposure of which led to a sprawling investigation and criminal trial in which Becciu is accused of embezzlement and abuse of office.

Becciu has routinely stated in court that the Secretariat of State was outside the oversight of both the Secretariat for the Economy and the Office of the Auditor General, despite no such exemption being present in either department’s remit.

In May 2022, Cardinal Pell questioned evidence given by Becciu in court to that effect, noting that the former sostituto “did not explain the Secretariat of State’s rejection of the papally approved supervisory role of the new Council and Secretariat for the Economy,” and “did not explain his role in the sacking of the auditors PriceWaterhouseCoopers, and in the resignation of the Auditor, Libero Milone; both mandated to investigate Secretariat of State finances.”

But on Wednesday, lawyers for the Secretariat of State conceded Milone’s assertion that he was acting within his mandate in trying to investigate Becciu’s former department.

In legal submissions obtained by The Pillar, submitted in writing and reiterated during the lawsuit hearing on Oct. 18, lawyers for the Secretariat of State defined the relationship between Milone former department and the secretariat as “the relationship between the ‘entity that provides to the audit of the financial statements’ (the Auditor) and the ‘entity subject to audit’ (the Secretariat of State).”

The secretariat’s legal team argue that because Milone’s former department was constituted by Pope Francis and meant to report independently to him, the Secretariat of State cannot be cited in his wrongful dismissal claim. Instead the lawyers argue, Milone could only be appointed or dismissed by the pope personally, and his loss of office was covered by canon 1404 of the Code of Canon Law, which bars appeals against acts of the pope.

That argument was rejected by the court during the preliminary hearings of the lawsuit, during which Milone’s legal team submitted his letter of appointment — which cited Francis, but was issued by the Secretariat of State, and signed by the Cardinal Secretary of State Pietro Parolin. 

Judges ruled earlier this year that the text of the appointment did not include the necessary legal language to make it an unappealable papal act.

While the Secretariat of State’s legal arguments, presented this week during the final hearing, appeared to substantially represent their earlier appeals for the case to be thrown out, the official acceptance that Milone’s former office had oversight of the secretariat could have repercussions for Becciu’s criminal trial.

Among the range of charges the cardinal faces, he is accused of several counts of abuse of office. 

Becciu has previously insisted that he was justified in stymying Milone’s attempts to look into investments like the London property deal because his department was outside the Office of the Auditor General’s remit. 

A formal legal acknowledgment by the department that this is not the case could be seen as substantiating charges that Becciu abused his office to block legitimate actions by Milone.

Milone’s legal team have deposited more than 500 pages of evidence with the court which he says prove he uncovered high level corruption during his work and that he was forced from office under threat of criminal prosecution to shut his efforts down.

“What it was,” Milone told The Pillar last year, “is that I discovered that there were cardinals putting money in their pockets, they were doing strange things.”

“Evidently, [Cardinal] Becciu and his friends must have come across these reports because he was the pope’s chief of staff at the time, and got worried because ‘this guy’ was putting these cardinals in difficulty.”

Key to Milone’s claims is that Cardinal Becciu forced his resignation by working together with the then-head of the Vatican Corps of Gendarmes, Domenico Giani.

The former auditor claims that Giani engaged in his own financial misconduct, and that when Milone discovered it, the police chief formally accused him of illicit spying. The former auditor also recalls finding that his Vatican offices had been bugged and his office’s computers hacked, and claims that while he made several complaints to Vatican police, the security breach was never investigated.

Speaking to The Pillar last year, Milone noted that Giani “had a reason to get me out,” because he had uncovered evidence of corruption in the Vatican police force.