Vatican Monsignor Arrested Second Time for Illicit Financial Dealings

Posted on: January 27, 2014, 05:30h. 

Last updated on: January 26, 2014, 05:16h.

Vatican Monsignor Nunzio Scarano
Monsignor Nunzio Scarano has some ‘splainin’ to do after a second arrest involving Vatican funds (Image: AP)

Whenever you think you’ve heard the craziest embezzlement story in the history of man, along comes another one to prove you dead wrong. Such is the case of a Vatican monsignor – already awaiting trial on charges of plotting to smuggle 20 million euros ($30.8 million) into Italy out of Switzerland, mind you – who has now been charged separately for allegedly using his access to Vatican bank accounts to launder money.

Millions of Euros Moved Around

Referred to as “Monsignor 500” because that is reportedly his favorite cash denomination, Monsignor Nunzio Scarano was arrested by financial authorities in Salerno in the south of Italy, after police say he used fictitious donations from offshore businesses to move millions of euros through his Vatican Institute for Religious Works accounts.

When police caught up with Salerno last week, they were able to confiscate 6.5 million euros worth of bank accounts and real estate holdings, including a luxury condo occupied by Salerno himself that was decked out with expensive artwork and antiques.

Along with Salerno, a local priest was placed under house arrest while a notary public received a suspension for their alleged roles in the money-laundering scheme. But apparently the tentacles were far-reaching on this episode; authorities say that 52 people all told are under scrutiny for possible involvement as well.

In what may be one of  the best comedy lines of the year, Scarano’s attorney Silverio Sica told the court that although his client took in donations from folks he thought were legit to pave the way for a home for the terminally ill, he actually used the funds to pay off his own mortgage.

Well sure, that could happen to anyone.

“We continue to strongly maintain the good faith of Don Nunzio Scarano and his absolute certainty that the money came from legitimate donations,” Sica said.

Arrest Numero Due

This latest investigation follows one already mid-process that began last June in Rome, when Scarano was arrested for alleged smuggling activities. The Monsignor has certainly been one busy fella, you have to give him that much.

In this case, prosecutors allege that Scarano – along with a financier and carabinieri (national military police) officer – came up with an elaborate plot that would involve moving  €20 million, via private jet transport, from Switzerland into Italy, with the goal of avoiding paying any customs duties. It all blew up when the unnamed financier pulled out of the plot at the eleventh hour; it’s unclear if he then went to authorities or not.

Scarano’s attorney Sica says his client was just the middleman in that one. Because apparently, that’s not illegal.

Police now think that money for both cases could have originated with the D’Amico family, a prominent Italian shipping dynasty. They say that more than  €5 million were given to Scarano by offshore companies that could be traced back to the D’Amicos.

Authorities say that back in 2009, Scarano withdrew  €555,248 from his Vatican account, moving it into Italy proper. In order to avoid suspicion, police report, Scarano elicited the aid of 50 acquaintances, convincing them to take  €10,000 each; he then got back checks or wire transfers in the same amounts.

Using a company of which Scarano had partial ownership, the Monsignor then used the gathered monies to pay off said mortgage on one of his properties.

No one from the D’Amico family has yet been arrested or charged, and the family has denied any involvement via a PR firm. They emanate from Salerno as well.

Scarano was fired following the initial arrests; apparently embezzlement charges don’t look great on your resume when you’re an accountant in one of the world’s wealthiest organizations. It’s all love and peace until you start messing with the money, and Vatican prosecutors seized  €2.3 million that remained in Scarano’s accounts following his arrest.

Now the Vatican’s top prosecutor says the Holy See is cooperating with Italian authorities, and asking for help in return, in order to get to the bottom of this money-laundering case to end all money-laundering cases. According to the Vatican’s own internal investigations, Scarano’s busy banking activities showed as much as  €7 million moving in and out of his Vatican accounts throughout the last ten years.

Along with Salerno’s firing in June came the resignations of two top banking managers within the Vatican, and the ironically delightful call for the world’s most powerful religious organization to adapt international anti-money-laundering standards.

It now appears no one less than Pope Francis himself has called for major Vatican banking reforms, and has even created a commission to  expedite that effort.

Scarano is on house arrest due to what is referred to as his ailing health. Apparently arrest #2 will not change that mode of punishment. We’re just a little confused if he’s still in the fancy apartment, or if he’s now moved to more modest digs.