Institute for the Works of Religion

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Institute for the Works of Religion
Istituto per le Opere di Religione
IndustryFinancial services
Founded27 June 1942 (absorption of the Administration of the Works of Religion)
HeadquartersVatican City
Key peopleErnst von Freyberg (President)
Ronaldo Hermann Schmitz (Vice-president)
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Institute for the Works of Religion
Istituto per le Opere di Religione
IndustryFinancial services
Founded27 June 1942 (absorption of the Administration of the Works of Religion)
HeadquartersVatican City
Key peopleErnst von Freyberg (President)
Ronaldo Hermann Schmitz (Vice-president)

The Institute for the Works of Religion (Italian: Istituto per le Opere di ReligioneIOR), commonly known as the Vatican Bank, is a privately held institute[1] located in Vatican City and run by a Board of Superintendence which reports to a Cardinals' Commission and the Pope.

The institute was founded by papal decree of Pope Pius XII in June 1942. Because its assets are not the property of the Holy See, it is outside the jurisdiction of the Prefecture for the Economic Affairs of the Holy See.[2][note 1]

In June 2012, the IOR gave a first short presentation of its operations.[3] On 22 May 2013, the Vatican's financial watchdog, the Financial Information Authority, whose Director is René Brülhart, published its first Annual Report,[4] and announced that in 2012 it had identified six suspicious activities, two of which were serious enough to be reported to the Vatican prosecutor.[5][6] In July 2013, the Institute launched its own website, providing additional financial, historical and governance information,[7] and on 1 October 2013 published its first annual report.[8][9][10]

On 24 June 2013, Pope Francis created a special investigative Pontifical Commission to study IOR reform.[11] In 2014, he fired four of the five cardinals in attempt to fix corruption within the institute.[12]

The Bank Identifier Code of the Institute for the Works of Religion is IOPRVAVX. Its president is Ernst Freiherr von Freyberg-Eisenberg.


The Istituto per le Opere di Religione was founded on 27 June 1942 by Pope Pius XII. It absorbed the Amministrazione per le Opere di Religione (Administration of the Works of Religion), which had originated in the Commission for Works of Charity (Commissione ad pias causas) established by Pope Leo XIII on 11 February 1887.[13][14]

The purpose of the Istituto per le Opere di Religione is "to provide for the safekeeping and administration of movable and immovable property transferred or entrusted to it by physical or juridical persons and intended for works of religion or charity".[13][14] It is not a department of the Roman Curia, the central administrative structure of the Roman Catholic Church.[15] Nor is it a central bank.[note 2]

The Institute does not use deposits to lend money and does not issue securities for resale or other financial products.[16] The IOR's surplus is at disposal of the Holy See, to which the Institute in 2012 made a contribution of 50 million euros.[17]


According to its statutes, in effect since 1990,[13] the IOR is composed of five elements:

On 24 June 2013, Pope Francis created a Pontifical Commission responsible for reviewing the IOR's status and activities.[19] Its task is to "gather accurate information on the legal status and various activities of the Institute to permit, when necessary, a better harmonization of the said Institute with the universal mission of the Apostolic See". Its five members are:


The five members of the Board of Superintendence, appointed on 15 February 2013 for a term that expires in December 2015, are:[20]

Previous presidents were:



When the Holy See, whose tax-exempt status on income from Italian investments was revoked in 1968, decided to diversify its holdings, it employed as financial advisor Michele Sindona, who turned out to be "one of the biggest financial swindlers of the century"[22] and to have had links with the Mafia since 1958.[citation needed] The 1974 failure of Sindona's Franklin National Bank and the subsequent collapse of his financial empire, into which he had chanelled part of the Holy See's investments, entailed losses for the Vatican estimated by one source at 35 billion Italian lire (20 million pounds sterling).[22][23][24][25]

Banco Ambrosiano[edit]

In 1982, a major political and financial scandal connected with the collapse of Banco Ambrosiano involved the head of IOR from 1971 to 1989, Archbishop Paul Marcinkus, who allegedly had given "letters of patronage" on behalf of the IOR in support of the failed bank.[26] In 1987, an Italian court issued a warrant against Marcinkus, whom they accused of being an accessory to fraudulent bankruptcy. Marcinkus evaded arrest by staying inside Vatican City until the warrant was dismissed in 1991, whereupon he returned to his home country, the United States.[27] Chairman of the Banco Ambrosiano, Roberto Calvi was convicted of violating Italian currency laws and fled on a false passport to London where he was murdered.[28] The Istituto per le Opere di Religione, a 10% shareholder of Banco Ambrosiano,[29] denied legal responsibility for the Banco Ambrosiano's downfall but acknowledged "moral involvement", and paid US$224 million to creditors.[30]

Other allegations[edit]

Several books published during the 1980s and 1990s, such as Unholy Trinity: How the Vatican's Nazi Networks Betrayed Western Intelligence to the Soviets, Genocide in Satellite Croatia 1941–1945 and The Vatican's Holocaust, were highly critical of the Institute for the Works of Religion's historical relations with anti-communist governments and especially with the Independent State of Croatia during World War II.[31][32][33] Sources such as these engendered controversy, which centers on the authors' conclusions drawn from the documentation rather than the documents themselves.

The book Unholy Trinity says that, according to a 1998 report issued by the US State Department, the Independent State of Croatia treasury was illicitly transferred to the IOR and several banks after the end of World War II.[31][page needed] A 21 October 1946 report from US Treasury agent Emerson Bigelow, declassified in 1997, quoted a "reliable source in Italy" (who corroborated evidence already obtained by CIC intelligence officials of the Army),[34][need quotation to verify] who told Bigelow that Croatian officials had sent 200 million confiscated Swiss francs (CHF), largely in the form of gold coins, to the Vatican "for safekeeping", and that they had attempted to send a further 150 million from Austria to Switzerland, a shipment intercepted by British authorities.[34][35] (Other rumors recorded by the US Treasury were that Ustasha leader Ante Paveliċ brought with him to Austria large amounts of gold, some or all of which he handed to the British authorities before being released or escaping.)[36] The Italian source also reported a rumor that much of the sum allegedly deposited in the Vatican had been sent to Spain and Argentina, a rumor that the Italian source said might be meant to cover up retention of the entire amount in the Vatican.[35] Bigelow's report nowhere made mention of the IOR, only of "the Vatican".[35] The June 1998 report of the US Treasury declared that there was in fact no substance in the Bigelow report of Vatican involvement.[37] "There is no basis in reality to the report", said Vatican spokesman Joaquin Navarro-Valls, as reported in Time Magazine.[38]

Tony Abse, writing in The Weekly Worker, an organ of the Communist Party of Great Britain, has said that the CIA used the Institute for the Works of Religion to funnel funds to the Solidarity Polish trade union "as part of the final offensive against the Soviet Union".[39] The organization American Atheists says covert United States funds were channelled in the same way both to Solidarity and to Contra guerrillas.[40]

Class action suit by Holocaust survivors[edit]

Alperin v. Vatican Bank is a class action suit by Holocaust survivors against the Institute for the Works of Religion and Franciscan Order ("Order of Friars Minor") filed in San Francisco, California on 15 November 1999. The case was dismissed as a political question by the District Court for the Northern District of California in 2003, but reinstated in part by the Ninth Circuit Court of Appeals in 2005. That ruling has attracted attention as a precedent at the intersection of the Alien Tort Claims Act (ATCA) and the Foreign Sovereign Immunities Act (FSIA).

The complaint against the Vatican Bank was dismissed in 2007 on the basis of sovereign immunity, but the case against the Franciscan Order continues as of 2009. According to one analysis, "the case is extremely complicated and potentially massive, considering the large class spread across many countries".[41]

2009–2012 Vatican money laundering investigation[edit]

In 2009, the Italian magazine Panorama reported that IOR was being investigated by Italian authorities from the Financial Intelligence Unit of the Banca d'Italia and the Guardia di Finanza over money laundering transactions worth €180 million (US$ 218 million) through a branch of UniCredit located at Via della Conciliazione across from St. Peter's Basilica.[42] The bank handles accounts of the religious orders and other Catholic associations using the "offshore" (i.e., foreign) status of the Holy See.[43]

On 21 September 2010, Italian police declared that Gotti Tedeschi and another IOR manager were under investigation for money laundering charges. €23 million were seized as a precaution.[44] Police began an investigation regarding Gotti Tedeschi around a week before the news was made public after a division of the Bank of Italy alerted police to two transactions involving the IOR that were deemed suspicious.[45] The money seized was bound from an Italian bank, Credito Artigianato, to JP Morgan Chase and another Italian bank, Banca del Fucino.[45] Both the origin and destination of the funds were accounts under the control of the IOR.[46] The IOR had allegedly failed to disclose the origin of the money, a violation of Italian law.[45]

In a statement regarding the investigation, the Vatican said that it was "...perplexed and astonished by the initiatives of the Rome prosecutors, considering the data necessary is already available at the Bank of Italy."[45] According to the police, the presence of the investigation did not mean either of the officials involved had been charged with a crime, and a judicial ruling would be necessary to continue the investigation.[46] In July 2013, the case against Gotti Tedeschi was reported to be dropped.[47]

On 30 December 2010, Pope Benedict XVI established the Vatican's independent Financial Intelligence Authority (Autorità di Informazione Finanziaria, AIF) to oversee the monetary and commercial activities of all Vatican-related institutions, including the IOR. The Vatican's so-called "financial watchdog" monitors all Vatican financial operations and ensures they meet international norms against money-laundering and the financing of terrorism.[48]

On 31 May 2011, Rome's attorney general released the 23 million Euros in assets which had been seized in September, apparently in acknowledgment of the steps taken in the following months to conform the Institute to international standards.

On 24 May 2012, Ettore Gotti Tedeschi was ousted as Head of the Vatican Bank because of "failure to fulfill the primary functions of his office". He has been investigated on suspicion of money laundering,[49] but in July 2013, the inquiry was dropped.[50]

In July 2013 the Holy Sees's Financial Intelligence Authority (AIF), charged with monitoring the monetary and commercial activities of Vatican agencies, was admitted as a full member of Egmont Group, an international network of Financial Intelligence Units.[51][52]

Monsignor Battista Ricca[edit]

On 15 June 2013, with the approval of Pope Francis, the Cardinals' Commission appointed Monsignor Battista Mario Salvatore Ricca as the Institute's Prelate ad interim.[53] The function of the Prelate is to act as secretary of the Cardinals' Commission and to attend meetings of the five-member Board of Superintendence.[54] Following the nomination, the Italian media published reports that Ricca in the past allegedly was involved in consensual homosexual acts.[55] There was also speculation that opponents of reform might have withheld information about possible scandals in Ricca's past or that they might have made up unfounded rumours about Ricca's past.[56][57] It was reported that Ricca had offered his resignation because of the controversy,[58][59][60] but the head of the Holy See's Press Office declared the accusations as "not credible"[56] and Pope Francis himself informed journalists that an inquiry "found nothing".[61]

See also[edit]


  1. ^ The Annuario Pontificio lists it under neither "Holy See" nor "Vatican City State", placing it among charitable foundations. Annuario Pontificio 2012, pp. 1796-1803. John Paul II Foundation for the Sahel from
  2. ^ This central banking function of the Vatican is regulated by the Monetary Agreement between the European Union and the Vatican City State, Monetary Agreement between the European Union and the Vatican City State authorizing the use of the euro as the official currency of Vatican City. Implementation of that Agreement and oversight of the Vatican law against money laundering and financing of terrorism is in the hands of the Financial Information Authority established by Pope Benedict XVI on 30 December 2010. Motu proprio for the prevention and countering of illegal activities in the area of financial dealings, Pope requires full transparency of transactions in the Vatican


Specific citations
  1. ^ (Italian) Cfr. art. 2 of the Chirograph signed by John Paul II
  2. ^ Pollard, 2005, p. 2
  3. ^ [1]
  4. ^ Vatican's Financial Information Authority releases Annual Report, Vatican Radio, 22 May 2013
  5. ^ Philip Pullella: Vatican financial body investigating possible money laundering, Reuters, 22M May 2013
  6. ^ Giulia Segreti, "Vatican watchdog reports suspect money movements" in Financial Times, 22 May 2013
  7. ^ IOR launches website, Vatican Radio, 31 July 2013
  8. ^ IOR: IOR Annual Report 2012
  9. ^ Vatican bank publishes first ever annual report, BBC News, 1 October 2013
  10. ^ Nicole Winfield: Secretive Vatican bank takes step to transparency, AP, 1 October 2013
  11. ^
  12. ^ Lyman, Eric (15 January 2014). "Pope Francis shakes up Vatican Bank, sets financial cap for sainthood". Washington Post. Retrieved 17 January 2014. 
  13. ^ a b c Chirografo di Giovanni Paolo II con il quale viene data nuova configurazione all'«Istituto per le Opere di Religione»
  14. ^ a b Annuario Pontificio 2012, p. 1908
  15. ^ Roman Curia
  16. ^ Vatican bank launches website in effort to increase transparency, Catholic Herald, 1 August 2013
  17. ^ Vatican Bank Discloses Annual Earnings Report for First Time, Bloomberg, 1 October 2013
  18. ^ Tornielli, Andrea (January 15, 2014). "Francis shakes up Commission of Cardinals for the IOR". Vatican Insider. Retrieved January 15, 2014. 
  20. ^
  21. ^ "Communiqué of the Press Office of the Holy See: Appointment of the New President of the Supervisory Board of the Institute for the Works of Religion (I.O.R.)". 15 February 2013. 
  22. ^ a b Frederic Spotts, Theodor Wieser, Italy: A Difficult Democracy (Cambridge University Press 1986 ISBN 978-0-52131511-1), p. 252
  23. ^ Nicolas Pileggi, "The Tycoon Vanishes" in New York Magazine, 24 September 1979, p. 44
  24. ^ Mark Lombardi, Robert Carleton Hobbs, Judith Richards, Global Networks (published by Independent Curators in 2003 for a travelling exhibition of the work of artist Mark Lombardi, ISBN 0-916365-67-0), pp. 61-65]
  25. ^ The Banker, vol. 125, issues 587-592, p. 228
  26. ^ Dennis Patrick McCarthy, International Economic Integration in Historical Perspective (Routledge 2012 ISBN 978-1-13598750-3)
  27. ^ Bernard A. Cook (editor), Europe since 1945 (Routledge 2001 ISBN 978-0-20380174-1), p. 1082
  28. ^ The Vatican Bank is rocked by scandal again
  29. ^ Benton E. Gup, Bank Failures in the Major Trading Countries of the World (Greenwood 1998 ISBN 978-1-56720208-3), p. 31
  30. ^ John L. Allen, The Catholic Church: What Everyone Needs to Know (Oxford University Press 2013 ISBN 978-0-19997679-9)
  31. ^ a b Aarons & Loftus, Unholy Trinity, p. ??
  32. ^ Paris, Edmond. Genocide in Satellite Croatia 1941–1945. The American Institute for Balkan Affairs, 1990. 
  33. ^ Manhattan, Avro (1986). The Vatican's Holocaust. Ozark Books. 
  34. ^ a b Aarons & Loftus, Unholy Trinity, p. 297
  35. ^ a b c Emerson Bigelow's report
  36. ^ June 1998 Supplement to Preliminary Study on U.S. and Allied Efforts To Recover and Restore Gold and Other Assets Stolen or Hidden During World War II
  37. ^ Alan L. Berger, Harry J. Cargas, Susan E. Nowak (editors), The Continuing Agony (Global Academic Publishing 2002 ISBN 978-1-58684211-6), p. 141
  38. ^ The Vatican Pipeline, Time Magazine, 22 July 1997
  39. ^ "Vatican: Rotten to the Core". American Atheists. 4 July 2013. Retrieved 22 July 2013. 
  40. ^ "Gelli arrest is another chapter in sordid Vatican bank scandal". American Atheists. 16 September 1998. [dead link]
  41. ^ Reuben Hart. 2006. "Property, War Objectives, and Slave Labor Claims: The Ninth Circuit's Political Question Analysis in Alperin v. Vatican Bank". 36 Golden Gate U.L. Rev. 19.
  42. ^ Josephine McKenna (7 December 2009). "Vatican Bank reported to be facing money-laundering investigation". The Times. Retrieved 12 June 2010. 
  43. ^ Agence France-Presse (1 June 2010). "Vatican bank suspected of money laundering: report". MSN. Retrieved 5 June 2010. [dead link]
  44. ^ AGI News On (21 September 2010). "IOR: GOTTI TEDESCHI UNDER INVESTIGATION, 23 MLN EURO SEIZED". Retrieved 21 September 2010. 
  45. ^ a b c d "Vatican Bank 'investigated over money-laundering'". BBC News Online. 21 September 2010. Retrieved 22 September 2010. 
  46. ^ a b Donadio, Rachel (21 September 2010). "Money-Laundering Inquiry Touches Vatican Bank". The New York Times. Retrieved 22 September 2010. 
  47. ^ ANSA (Italian News Agency), 2 July 2013: "Ior: Gotti Tedeschi verso archiviazione"
  48. ^ The Vatican Creates a Financial Watchdog, The New York Times, 30 December 2013
  49. ^ "Vatican bank chief ousted after unanimous no-confidence vote". USA Today. 24 May 2012. Retrieved 24 May 2012. 
  50. ^ Italian prosecutors drop inquiry into former Vatican bank chief, Reuters, 6 July 2013
  51. ^ "Vatican Financial Intelligence Authority Admitted to Global Network of Financial Intelligence Units". Zenit News Agency. 3 July 2013. Retrieved 4 July 2013. 
  52. ^ "Despite setbacks, Vatican Bank undergoing important evolution". Catholic News Agency. 4 July 2013. Retrieved 7 July 2013. 
  53. ^ Pope Francis appoints prelate to oversee Vatican bank , BBC News, 15 June 2013
  54. ^ Interim bank appointment means Pope wants cardinals' advice, Catholic News Agency, 17 June 2013
  55. ^ The Prelate of the Gay Lobby, L'Espresso, 18 July 2013
  56. ^ a b Edward Pentin, "Vaticanista Publishes Lurid Tale Surrounding Vatican Bank Appointee" in National Catholic Register, 24 July 2013
  57. ^ Pope Francis's judgment in question after priest named in gay sex scandalGay scandal at the heart of the Vatican: Pope Francis faces his first crisis Prelate Battista Ricca's 'gay romance' rocks Vatican
  58. ^ Catholic World News (22 July 2013): "Prelate of Vatican bank reportedly offers resignation"
  59. ^ Romans always love a Vatican scandal. But what if this time they're right?
  60. ^ Style and substance
  61. ^ "Post-WYD Surprise: Pope Francis Gives Wide-Ranging In-Flight Press Conference" (National Catholic Register, 29 July 2013)
General references
  • John F. Pollard: Money and the Rise of the Modern Papacy: Financing the Vatican, 1850–1950 ISBN 0-521-81204-6
  • Mark Aarons and John Loftus: Unholy Trinity: How the Vatican's Nazi Networks Betrayed Western Intelligence to the Soviets. New York: St.Martin's Press, 1992. 372 pages. ISBN 0-312-07111-6
  • Malachi Martin: Rich Church, Poor Church (Putnam, New York, 1984) ISBN 0-399-12906-5
  • Malachi Martin: Vatican (Jove (1 August 1988)) ISBN 978-0-515-09654-5
  • Charles Raw: The Moneychangers: How the Vatican Bank Enabled Roberto Calvi to Steal 250 Million Dollars for the Heads of the P2 Masonic Lodge (Harvill Press, 1992) ISBN 0-00-217338-7
  • Giancarlo Galli: Finanza bianca. La Chiesa, i soldi, il potere (Mondadori, 2004) ISBN 88-04-51262-8
  • David A. Yallop: In God's Name: An Investigation into the Murder of Pope John Paul I
  • Mark Lombardi: Global Networks. Mark Lombardi, Robert Carleton Hobbs, Judith Richards; Independent Curators, 2003 (published for the travelling exhibition of his work, "Mark Lombardi Global Networks"). ISBN 0-916365-67-0
  • Jonathan Levy, "The Vatican Bank", in Russ Kick (Ed.), Everything You Know is Wrong (Disinformation Press, 2002) ISBN 1-56731-701-4
  • Michael Phayer: Pius XII: The Holocaust and the Cold War, 2008, ISBN 978-0-25334-930-9.

External links[edit]


Coordinates: 41°54′14″N 12°27′24″E / 41.90378°N 12.45669°E / 41.90378; 12.45669