Vatican bank head fired for money laundering
Jun 07, 2012
The Vatican Bank was established in 1942 and has been accused of money laundering since the beginning. The problem was that they engaged in secrecy, so the charges were difficult to prove. But now "transparency" is being demanded by the world banking system itself, which has caused banks in many countries to squirm.
The lastest is the Vatican Bank. On May 24, 2012 the head of the Vatican Bank, Gotti Tedeschi, was fired amidst allegations and even the seizure of tax funds by the Italian police.
In 2010 Italian police launched an investigation against Mr Gotti Tedeschi as part of a money-laundering inquiry.
Members of the board believed his dismissal was needed to "maintain the vitality of the bank", the Vatican statement said.
The board will now look for a new director to restore relations with the international financial community, "based on mutual respect for accepted international banking standards".
Mr Gotti Tedeschi declined to comment on his dismissal. He told journalists: "I'd rather say nothing, otherwise I'd say ugly things."....
As part of the inquiry, Italian tax police seized 23m euros ($29m, £18.4m) that the Vatican Bank had tried to transfer from a small Italian bank called Credito Artigiano.
It sounds to me like Mr. Tedeschi was just following orders and is rather bitter about being made the scapegoat.
But now it is being reported that Tedeschi is being investigated personally, and police were given a search warrant to find evidence in his home.
The probe centers on accusations that Selex set up a system of false invoices created to evade taxes and used the proceeds to set up a €2-million ($2.7-million) slush fund to pay off political go-betweens. The alleged corruption revolved around contracts for Italy's air traffic controller body, ENAV.
Gotti Tedeschi is a well-connected Italian financier and head of the Italian branch of Spain's Banco Santander.
With the Spanish banks in trouble these days, it makes us wonder if Tedeschi's position in the Italian branch of that bank is part of the money laundering investigation. As more focus turns to the Spanish banks, it is likely that the light of investigations will probe any international branches as well.
Spain's Bankia needs a $24 billion bailout, they claim, but the Spanish government is in no position to bail anyone out. In fact, they are in need of a bailout from the Eurozone.
“The problem for Spain is that they can’t simply finance all this by issuing debt,” said Edward Thomas, who helps manage $6 billion as head of fixed-income investment at Quantum Global Wealth Management in Zug, Switzerland. “It’s a perfect storm for Spain, with more banks now being sucked in.”
Spain needs to bail out lenders still reeling from the collapse of the real-estate boom while its own access to funding increasingly depends on domestic banks being kept afloat by the European Central Bank’s refinancing operations. Rising borrowing costs are putting pressure on Rajoy’s five month-old government to joinGreece, Portugal and Ireland in seeking a rescue that would be the European Union’s biggest.
Spain is the "S" in the so-called PIIGS countries (now shortened to PIGS, once they dropped Iceland from the radar). The banks can't bail out the government, and neither can the government bail out the Spanish banks. It is only a matter of time before the PIGS are slaughtered.
One by one, the dominos of the Tower of Babel are falling. It is a slow train wreck, to be sure, but in my view, it is prophetically inevitable. God is giving each nation time to change to Kingdom economics before a disorderly collapse into rubble.
The Vatican decided in 1929 to sanctify the sin of usury and join the banking system. It started with Mussolini's "donation" of $90 million as part of the Lateran Treaty of Feb. 11, 1929. This treaty paved the way for Mussolini to take control of Italy without Vatican opposition. I wrote about this some years ago in FFI #199:
The Vatican felt it could not beat the Babylonian system, so it joined them. Now it finds itself in the collapse as well. Perhaps the firing of Mr. Tedeschi could be viewed as a divine wake-up call to "come out of Babylon." However, it does not seem likely that this will happen before they suffer much financial loss.