Vatican finance trial highlights pressure to finalize London deal

A hearing in the Vatican finance trial on May 31, 2022 A hearing in the Vatican finance trial on May 31, 2022. | Vatican Media.
A hearing in the Vatican finance trial on May 31, 2022 Vatican Media.
A hearing in the Vatican finance trial on May 31, 2022 Vatican Media.
A hearing in the Vatican finance trial on May 31, 2022 Vatican Media.
A hearing in the Vatican finance trial on May 31, 2022 Vatican Media.

The deal to acquire control of a London investment property was finalized under intense “psychological pressure,” according to Fabrizio Tirabassi, a lay official at the Secretariat of State who was questioned during a Vatican finance trial hearing on May 31.

Enrico Crasso, a longtime investment manager for the Vatican, confirmed the situation at a hearing on May 30, stressing that the Secretariat of State did not even have a lawyer at the negotiating table when the luxury property was transferred to alternative management.

The 18th and 19th hearings of the trial offered a glimpse inside the financial operations of the Vatican’s top dicastery.

To some extent, the testimonies confirmed the existence of the so-called “Perlasca method” described in a document submitted to the Vatican court by Archbishop Edgar Peña Parra, the current Sostituto of the Secretariat of State. The method refers to the practices of Monsignor Alberto Perlasca, a Secretariat of State official who was formerly a suspect and now a key witness.

But the statements also demonstrated, to some degree, what Cardinal Angelo Becciu said in his testimony: that when he was Sostituto, he only had a formal power to make decisions while mostly delegating them based on trust.

The questioning of Crasso and Tirabassi will continue at a later date. They are just two of the 10 defendants in the Vatican’s “maxi-trial,” which contains three different investigations. One concerns the Secretariat of State’s investment in the London property. A second is focused on Becciu’s alleged embezzlement in favor of his family and dioceses in Sardinia. The third relates to the Secretariat of State’s hiring of Cecilia Marogna, a self-described “security consultant.”

Both of this week’s sessions lasted between seven and eight hours.

It is worth remembering that the Holy See decided to purchase shares of the London property after dismissing the possibility of investing in an oil company in Angola.

The building’s management was first entrusted to the Italian broker Raffaele Mincione, who was initially involved in the study for the Angolan deal. The Secretariat of State then decided to take Mincione’s shares and hand them over to another Italian broker, Gianluigi Torzi.

But Torzi took control of the only 1,000 shares with the right to vote, thus compelling the Secretariat of State to negotiate the broker’s exit from the business and finally get complete control of the building.

Tirabassi’s testimony mainly concerned the negotiations with Mincione, which took place in London on Nov. 20-22, 2018. Tirabassi was present for the discussions.

Tirabassi noted that the Secretariat of State decided to diversify its investment plan in 2012 and allocated some 200 million euros (around $214 million) to a fund for new operations, primarily real estate (“a traditional investment for the Secretariat of State,” he said.)

The Holy See moved 30,000 shares in the London property to Gutt SA, Torzi’s Luxembourg-based company, while Torzi sought to keep 1,000 shares, the only ones with voting rights. According to their testimonies, neither Crasso nor Tirabassi was aware of the diversity of the shares.

The Vatican finally bought the 1,000 shares from Torzi for 15 million euros ($16 million). According to the indictment, the money given to Torzi resulted from extortion. The broker denies the allegation.

The negotiations took place amid a struggle within the Vatican over financial control and autonomy. A letter by Cardinal George Pell, the then prefect of the Secretariat for the Economy, was displayed during the hearings.

Pell complained that the Secretariat of State had not yet provided the necessary data for a budget. A draft written by Tirabassi and fellow Secretariat of State official Antonio Di Iorio accused the Secretariat for the Economy of interference in affairs beyond its powers. It emphasized that the Secretariat for the Economy “must realize that the statutes” did not allow it to infringe “the autonomy of the dicasteries.”

The Vatican’s promoter of justice (similar to a prosecutor) tried to demonstrate that both Crasso and Tirabassi pursued their personal interests. There were moments of tension during the questioning of both men.

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The primary purpose of the questions was to define how the decision was made to invest in the building in London’s Sloane Avenue, starting from an investment proposal for an oil extraction concession in Angola proposed by Antonio Mosquito, who Becciu met when he was nuncio to the African country.

Becciu said — and both Crasso and Tirabassi confirmed — that he had only presented the possibility of an Angolan investment but never applied pressure for it to be approved.

It also became clear how broker Raffaele Mincione entered the picture, presented by Credit Suisse London as a business expert on the model of the Angolan Falcon Oil.

During the hearings, another name appeared: that of Giuseppe Milanese, the entrepreneur friend of Pope Francis and head of the OSA cooperative. Tirabassi said that Milanese began to attend the Secretariat of State, presented by Becciu as a person very close to the pope.

Tirabassi added that the Secretariat of State also financed the sale of bonds of Milanese’s cooperative for six million euros (around $6.4 million) with a 6% profit and paid 270,000 euros (about $288,000) for a vehicle that visited parishes offering medical screenings for older people.

Tirabassi added that Crasso was asked for a feasibility study on the six million euro loan. The funding was then disbursed in the financing plan of the Secretariat of State. Milanese was later sent by the pope to negotiate with Torzi.

It also emerged that the Holy See negotiated the London deal with no lawyer. But both Tirabassi (in constant contact with Perlasca) and Crasso were at the negotiating table. Tirabassi stressed that Crasso’s presence was directly requested by Perlasca and almost amounted to an imposition. On the other hand, Crasso said that he “shouldn’t have gone” because he had nothing to do with the operation. “It was the biggest mistake of my life,” he lamented.

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The Secretariat of State had entrusted Credit Suisse with the management. But Crasso emphasized that he was acting for his bank and then for Sogenel, a company that he set up which continued to work with Credit Suisse.

But managers are not required to account for all investments, and the important thing is that they follow through on their mandates. Crasso also referred to a 2016 formal statement by Vatican Secretary of State Cardinal Pietro Parolin which made it clear that there were no limits on where Credit Suisse assets could be invested.

For this reason, even Mincione, when he was entrusted with the fund of the London building, was not subject to regular, thorough checks.

Financial transactions were handled above all by Perlasca, head of the administration, through whose hands practically every authorization passed.

Crasso also spoke of a letter received on Nov. 11, 2019, from Peña Parra, asking to “liquidate in the best possible way and with diligence” the assets of the Secretariat of State managed by him and “not to proceed with other investment” through the Centurion Global Fund, which Crasso owned.

“A letter of this kind creates immeasurable damage to the Holy See,” Crasso replied, asking for an audience with Peña Parra that he obtained on Nov. 16. “Peña Parra agreed not to limit the management,” Crasso wrote after.

Crasso noted that there was no follow-up to the letter and, in any case, “since Nov. 16, I have not set foot in the Vatican anymore.”

But the investments already approved were still pursued. Therefore, Tirabassi will have to continue to be questioned, as will Crasso. Many things remain to be clarified. The trial will resume on June 6 with Mincione’s questioning.

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