But the partnership of Cardinal Pell and Pope Francis as financial reformers fell apart soon after it began, and even before the sexual abuse charges against Pell caused him to return to his native Australia. Pell wanted to eliminate corruption, maximize profit, minimize expenses, adopt the “best practices” of international finance. He wanted to create a consolidated and well managed Vatican investment fund. That fund would invest in international stock markets and currency markets. But Francis saw reform more as return of integrity, simplifying the Vatican bureaucracy, creating transparency, and providing more options for aiding the poor and the underprivileged. Francis never wanted to be running a religious version of a multi-national corporation. But nonetheless, the papal commission that had been set up continued to go forward with reforms and continued to review the activities of the Vatican Bank. The Bank’s internal auditing system was replaced with an independent, external one. New laws replaced indefinite appointments with single term limits. Moneyval, the European Union’s committee continued to evaluate the Banks compliance with international anti-money laundering and financial terrorism rules. Moneyval consistently praised the Vatican for improving its internal regulation. But along with reform came the uncovering of financial crime, and arrests of top church officials including the former head of the Vatican Bank. The trial of Angelo Caloia, 81, who was the president of the Vatican Bank from 1989 to 2009 began in 2018. He along with his 97 year-old lawyer – Gabriele Liuzzo and Liuzzo’s 55 year old son, were found guilty by the Vatican Court of the crimes of money-laundering and aggravated embezzlement on January 21, 2021. The verdict was a landmark moment in Vatican financial reform. Both Caloia and lawyer Liuzzo received eight year and 11 month jail sentences for their roles in a $70 million fraud. The younger Liuzzo received a sentence of five years and 2 months. The crimes consisted of a complicated scheme to sell about 70 percent of the properties that belonged to the Vatican Bank in the period from 2001 to 2008. Some of the properties were high rent apartments in Rome, Milan and Genova. The properties were sold at below their real market value in exchange for kickbacks. The Vatican Bank is believed to have lost $70 million since the real market value had not been paid. In the convicted men’s bank accounts, $30 million was confiscated. The current lawyer for the Vatican Bank said the verdict makes a statement: “The party is over.” “Today there’s zero tolerance for behavior that plunders the institute (Bank).” It is the first time such a prosecution has been entirely the Vatican’s initiative.” In a handful of cases in the past the Italian justice system began the cases. This case was a Vatican undertaking and indicates that the reforms started by Pope Benedict XVI and continued under Pope Francis have taken hold. So it appears that justice will be served. However, the Vatican criminal justice system has two levels of appeal and appeals have been known to last for years. So at their advanced age, the two older men may never see the inside of a jail cell
