The Vatican and Italy will soon sign a Memorandum of Understanding between their financial authorities to regulate data exchange, but this agreement is not tied to the recent scandals involving the so-called Vatican bank.

"Italy is merely one part of the Holy See's international agenda, and the Holy See is improving its international cooperation to combat money laundering and financing of terrorism," according to an employee from a Vatican financial institution who spoke to CNA July 26 and asked for anonymity.

The signing of the Memorandum of Understanding between the Vatican Authority for Financial Information and its Italian counterpart, the Financial Intelligence Unit, should be announced in a matter of days.

The Vatican authority has already signed similar pacts with other counterparts, including the U.S. Financial Intelligence Unit FinCEN.

The memorandum would mark a first significant step towards normalizing banking relations with Italy.

Despite the generally positive evaluation on the state of the Vatican financial system issued in July 2012 by MONEYVAL – the Council of Europe's committee that evaluates adherence to the international anti-money laundering standards of its member states – the problem of the transparency of the Vatican's banking operations has been often raised, especially by the Italians.

The most recent case is that of Monsignor Nunzio Scarano, a suspended employee of the Administration of the Patrimony of the Apostolic See.

Msgr. Scarano is now under arrest for an alleged plan to transfer 20 million euro from Switzerland to Italy aboard an Italian government airplane.

He is also being investigated by the public prosecutor in his home town of Salerno, Italy for supposedly laundering 560,000 euros he took from his account in the Institute for Religious Works – the so-called Vatican bank – to pay off the mortgage of a house in Salerno.

On July 25, a letter written by Msgr. Scarano and addressed to Pope Francis was delivered to the Vatican by his lawyers. The Pope will be in Rio de Janeiro for World Youth Day until July 29, when he flies into Rome's Ciampino Airport.

In the letter, Msgr. Scarano insisted that he "never committed any money-laundering and never stole."

He also said that he asked for a meeting with Cardinal Angelo Sodano, dean of the College of Cardinals and Secretary of State emeritus.

But in Msgr. Scarano's words, the meeting never took place because "the smart Msgr. Giorgio Stoppa blocked my requests for an audience."

However, Gorgio Stoppa is not a monsignor, a fact that led CNA's Vatican financial source to say, "this would lead one to think that the letter was not written by Scarano, but by his lawyers, since a Curia employee would never make mistakes of this kind."

At the level of state matters, the source confirmed that the negotiations on a Memorandum of Understanding between Italy and the Vatican are not directly connected with the Scarano scandal.

In the past it would have been possible that the Vatican might pursue an agreement to maintain good relations with the country that surrounds it, but the financial source said the city state's focus is much broader in this case.

Nevertheless, the source ventured, the Scarano case could be "a first test of the agreement," which would test both governments.

"We will also see if the Vatican Authority for Financial Information will provide its Italian counterpart with useful data."

At the same time, the financial expert pointed out, "it will be interesting to see if the Italian Financial Intelligence Unit will provide useful data to the Vatican authorities for their investigations."

As communicated in a press release on July 9, the Vatican froze Msgr. Scarano's accounts at the Institute for Religious Works and started an investigation.

It is rumored that Scarano's suspicious transactions filled 89 pages of statements.

In the meantime, the experts of Promontory Group are studying the Institute for Religious Works files, in order to shed light on the suspicious transactions and clean up the so-called Vatican bank account.

Another source who works in a Vatican financial institution and is familiar with the Institute for Religious Works told CNA on July 26 that "the IOR President von Freyberg completely left his office to the Promontory advisors, while he is working in a small room in the vicinity of the office of the director."