Mark Corallo, a spokesman for the Papal Foundation, challenged this interpretation. His statement, quoted in O’Brien’s essay, said there were “a variety of interpretations” of the financial condition of the grantee and its sponsoring entities.
“Clearly there were different readings of available information, but it is not correct to characterize the presentation of Cardinal Wuerl or other participants at the Board meeting as false or misleading,” Corallo said.
Since 1990, the foundation has given over $100 million to support projects and proposals recommended by the Holy See. American cardinals are ex officio leaders of the foundation, though it has a significant number of lay board members. Grants are made for needs that are particularly significant to the pope, and often go to institutions and organizations in developing nations. The grants typically do not exceed $200,000 each.
The foundation’s approval of a $25 million grant to a financially and legally troubled Italian hospital became a major controversy among board members who argued the grant was approved without due diligence. This controversy drew media coverage in early 2018.
After the June 2018 exposure of sex abuse allegations against then-Cardinal Theodore McCarrick, a past Washington archbishop, further questions were raised about the possibility of further corruption, the use of funds for undue influence, and Cardinal Donald Wuerl’s knowledge of McCarrick’s abuse.
In December 2017, the foundation approved a $25 million grant to the Rome hospital Istituto Dermopatico dell’Immacolata (IDI). According to O’Brien, this approval came in response to a request from Vatican Secretary of State Cardinal Pietro Parolin, made on behalf of Pope Francis.
The hospital, which had been under the direct ownership of the Congregation of the Sons of the Immaculate Conception, remains one of the leading dermatological hospitals in Italy.
In 2013, Italian authorities arrested a priest who was its chief executive through 2011 and two others for allegations dating back as far as 2005. They were convicted on charges relating to the embezzlement of 6 million euros in public money from the hospital and diversion of another 82 million euros. The hospital allegedly evaded taxes on 450 million euros. Its debt of over 800 million euros led to bankruptcy.
Financial reorganization led to the purchase of the hospital and its affiliates through a partnership between the Congregation of the Sons of the Immaculate Conception and the Vatican Secretariat of State. This partnership owns and operates the IDI hospital and its affiliates through the non-profit Fondazione Luigi Maria Monti and a limited liability subsidiary, Luigi Maria Monti, S.r.l.
At the Papal Foundation’s December 2017 meeting that approved the grant, O’Brien charged, Wuerl made two false statements recorded in the meeting minutes: he wrongly claimed that the religious congregation involved in the hospital during the time of fraud, embezzlement and insolvency was no longer involved; and he understated the debt of the hospital and its affiliates after April 2015 insolvency proceedings.
Corallo, a Papal Foundation spokesman, said there were “a variety of interpretations” of the financial condition of the IDI and its sponsoring entities. The relationship of the religious congregation and the IDI was “still unclear,” he said, and all discussion was made difficult by “conflicting interpretations.” Wuerl’s December 2017 presentation used both publicly available information and information “provided by the Holy See.”
“Other interpretations were also offered,” said Corallo.
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O’Brien countered that much information, including the $60 million debt and the continued involvement of the Sons of the Immaculate Conception, were available publicly. He argued that Wuerl “does not appear to have taken any steps to clarify the crucial information about the supposed beneficiary of the $25 million grant.”
Wuerl told the board that the IDI group owed $26 million in payables but did not mention a $60 million mortgage debt, O’Brien said. He added that Wuerl resisted lay board members’ requests for financial statements from the hospital.
McCarrick, Wuerl’s predecessor as Archbishop of Washington, at the time was an ex officio member of the foundation board.
O’Brien said Wuerl knew that McCarrick could win leniency in the Vatican’s treatment of his sex abuse case if he were able to secure the grant for the hospital, at the request of the Vatican Secretary of State.
Wuerl also failed to disclose that a Vatican dicastery for which he is a board member, the Administration of the Patrimony of the Holy See (APSA), is apparently a creditor of the troubled IDI, O’Brien said. The APSA lent 50 million euros to the IDI as part of its reorganization.
O’Brien said it is still unknown whether the first part of the grant, worth $13 million, was delivered to the Fondazione Luigi Maria Monti. According to O’Brien, the Papal Foundation has not said whether it has sent the final part of the grant.