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Police are investigating Vatican Bank (a commonly-used name for Istituto per le Opere di Religione, or IOR) CEO Ettore Gotti Tedeschi on suspicion of money laundering. From the BBC:

Prosecutors also seized 23m euros ($30m; £19m) from the bank’s accounts with another smaller institution. The inquiry was launched after two suspicious transactions were reported to tax police in Rome.

The BBC’s David Willey in Rome says the Bank of Italy’s financial intelligence unit tipped off Italy’s tax police last week, after two suspicious transactions were reported between the Vatican Bank and two different Italian banks.

The tax police seized one deposit of 23m euros that the Vatican Bank had deposited with a small Italian bank called Credito Artigianato, our correspondent says.

“The bulk of the money, euro20 million, was destined for JP Morgan in Frankfurt, with the remainder going to Banca del Fucino,” according to the AP.

“The Vatican Bank, known officially as the Institute for Religious Works, was created during World War II to administer accounts held by religious orders, cardinals, bishops and priests,” writes the BBC. As part of his job, Tedeschi reports to cardinals and the Pope himself. All of the bank’s profits are intended for religion or charity.

The Vatican Bank also has a history full of scandals (AP):

The Vatican bank was famously implicated in a scandal over the collapse of the Banco Ambrosiano in the 1980s. Roberto Calvi, the head of the Banco Ambrosiano, was found hanging from Blackfriars Bridge in London in 1982. The circumstances remain mysterious. Italian prosecutors maintain he was murdered, but there have been no convictions.

Last year, a U.S. appeals court dismissed a lawsuit against the Vatican bank filed by Holocaust survivors from Croatia, Ukraine and Yugoslavia who alleged it had accepted millions of dollars of their valuables stolen by Nazi sympathizers.

Vatican Bank fraud is nothing new. But, thanks to the Vatican’s status as a city-state, taking action against those crimes is difficult. From the New Statesman:

The Catholic Church is the only religion that is permitted – under international law as interpreted by the Foreign Office, and at the United Nations – to claim the privileges of sovereignty and statehood. These are consid­erable: both the Vatican and its leader have immunity from civil or criminal actions for the damage that they do to others – whether by trafficking paedophile priests or by condoning fraud at the Vatican Bank (suspects can avoid European arrest warrants by staying within the “inviolable” walls of the Holy City).

At the UN, which has…allowed the Holy See to do everything a nation state may do except vote in the General Assembly (where it is nonetheless accorded six seats from which to speak and lobby), the Church’s advantages over other faith groups are enormous.

“The Holy See expressed “surprise” and “bewilderment” at the operation, and has “full confidence” in Gotti Tedeschi,” writes Bloomberg. But if authorities find evidence of wrongdoing, someone’s head is going to roll.

Ready for another book, Dan Brown?

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