Vatican bank wrote off $20 million Bertone investment

Friday, August 22nd, 2014

The Vatican bank has written off US$20 million that was invested in an Italian television company at the behest of Cardinal Tarcisio Bertone.

Two years ago, the Vatican’s then-Secretary of State, Cardinal Bertone, ordered the investment in Lux Vide SpA, for “evangelisation”.

The company makes family movies, including films about popes and a series about a bike-riding country priest who helps police solve crimes.

Cardinal Bertone pushed the deal through despite objections from the bank’s director and board members.

They thought the expense was too big and not justifiable, according to current and former bank executives.

The latter said Cardinal Bertone backed a proposal for the Vatican bank to buy up to 25 percent of Lux Vide in 2010 and, again in 2012.

Both times, the bank’s directors tried to reject the deal, saying it was not in the bank’s interest to invest in television companies and that the price was high.

But the deal was eventually approved. “The board said ‘this is not a good idea’ but could not block the deal,” said a current bank official.

“The message was: the boss (Bertone) wants this.”

Last month, the Vatican booked a loss for the entire amount spent, as part of a wider review of Vatican finances that has also led to the closure of hundreds of accounts at the Institute for Religious Works, as the Vatican bank is officially known.

Cardinal Bertone, who still stands by the decision to invest in the television company, said that when the bank approved the deal it did so with the board’s unanimous consent.

Bertone had a virtual free reign to run the Vatican’s administration under Pope Benedict XVI.

The zeroing of the Lux Vide investment is emblematic of Pope Francis’s effort to loosen ties between the Holy See and Italy’s business and political world.

Francis considers such relationships improper to the Church’s religious mission.

He has instigated an overhaul of the way the Vatican operates, including its finances.

Under the new structure created by Pope Francis, Cardinal Bertone’s successor as Vatican secretary of state, Cardinal Pietro Parolin, has no direct power over any of the financial affairs of the Holy See, including the IOR and APSA, the Vatican’s asset management and investment arm.

Source