Reforms of Holy See Financial Institutions Underway

AIF Director Responds to Latest Moneyval Report in Vatican Radio Interview

Vatican City, (Zenit.org) Ann Schneible | 582 hits

In an interview with Vatican Radio today, the director of the Vatican’s Financial Information Authority, René Brülhart, shed light on reforms being made to the Holy See’s financial institutions.

The interview coincides with today's publication of the Council of Europe’s Moneyval assessment report on how well the Holy See is implementing measures to combat money launderiing.

Brülhart said the so-called “progress report” is “based on the rules of procedures of Moneyval" but stressed such reports never have any kind of re-rating. "In other words, this report focusses on the implementation of the recommendations which have been made by Moneyval in its report of July 2012,” he explained.

He added that “it is a very comprehensive report, describing in great detail the steps the Holy See has taken over the last months.  

“It seems we have satisfied Moneyval, otherwise the report would not have been adopted,” he said, adding it was a “very positive sign”.

In its Dec. 12 statement, Moneyval concluded that "a very wide range of legislative and other measures have been taken in a short time by the Holy See to remedy deficiencies identified by the 2012 MONEYVAL report in all areas of [Anti-Money Laundering and Counter-Terrorism Financing]."

But it added that "certain issues still need to be addressed", and the new measures need to be tested.

Brülhart said the next step in the process of reform will be to conduct on-site inspections, primarily at the IOR (“Vatican Bank”).

This reform process will begin with an evaluation of the “remediation process” currently in place. While this process is carried out under AIF’s supervision, he said that they “want to look in greater detail into how this is done.”

He explained that, under the supervisory department: “we have this new function as prudential supervisor.”

“We will have to look into staffing to bring the relevant expertise – or further expertise – into to the Authority to carry out this work in a very constructive and sustainable manner.”

“There is still some work waiting for us,” Brülhart said, “but we are very happy to continue this path.”

Responding to the rise in so-called “suspicious transactions” since 2012 -- from 6 to 105 -- Brülhart said that such a rise is an indicator that the reporting system in place is function.

He explained that reports of suspicious activity do not necessarily indicate that money laundering is taking place. “Where a financial institution has a suspicion or a reasonable ground for suspicion, that a report is filed with the Financial Intelligence Unit, in that case it is us, AIF, and then it is up to us to analyze them, and then to take further steps.”

When asked if the Vatican, which joined Moneyval in 2011, could be considered a “success story,” Brülhart said: “We see a clear process which has been initiated: A clear path we are taking step by step. Now, with the publication of this report, and the adoption on Monday of this week, it is a clear indication that we are implementing and also applying international standards. Now if this is the criteria: Yes, it is a success story.”