Balestrero acknowledged that the millions of dollars in cash donations the Holy See receives every year from the faithful could raise alarm bells for regulators seeking assurances that its money was clean. He said that was an area the Vatican would study in the upcoming months.
The Vatican submitted itself to the Moneyval evaluation process more than two years ago after it signed onto the 2009 EU Monetary Convention. Since then, it has written and rewritten a law criminalizing money laundering, created the financial watchdog agency and ratified three anti-crime U.N. treaties, among other measures.
Each of those moves is required by the Financial Action Task Force, the Paris-based policymaking body that helps countries develop anti-money laundering and anti-terror financing legislation. The Council of Europe's Moneyval committee rated whether the Vatican was compliant, largely compliant, partially compliant or noncompliant in each of the task force's recommendations.
Sixteen of the original 49 recommendations are considered "key and core," with a score of six or more passing grades sparing the Vatican from a more intensive review and evaluation process in the future. By coming out with a 9-7 report card, the Vatican passed the test and is solidly in the company of other countries that have been working for years to come into compliance with the FATF norms.
One area singled out for improvement was in putting into operation U.N. anti-terrorism conventions, which require the Vatican keep a list of terror suspects and show how it can freeze and confiscate terrorist assets. The Vatican scored partially compliant and noncompliant, respectively. Balestrero noted that after the reporting deadline passed, the Vatican established the terror list — and had made other changes as well since the January deadline that will be taken into account in the progress report next year.
One area where the Vatican received high marks was in international cooperation in responding to judicial requests from other countries — undermining frequent complaints from Italian prosecutors that the Holy See has ignored requests for assistance.
Pope Benedict XVI himself has said he wanted the Vatican's finances to follow international principles, saying peace in the world today is threatened by terrorism and an improper use of the global financial system.
The Vatican's efforts shot into high gear in 2010, when the then-head of the Vatican bank, known as the Institute for Religious Works, was placed under investigation for alleged money laundering by Italian prosecutors after a suspect transaction was reported by the Bank of Italy. He has not been charged and the €23 million seized from the Vatican account by Italian financial police has been returned.
At the time of the seizure, the Vatican made clear it intended to get on the so-called "white lists" of financially transparent countries of both the Financial Action Task Force and the Organization for Economic Development and Cooperation, which oversees a separate process for countries to share financial information to fight tax evasion. Balestrero was asked Wednesday whether the Vatican was still pursuing the OECD process; he said merely that the Vatican was taking a "step by step" approach and focusing now on the FATF.
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