At the time McCarrick sent his letter, allegations of sexual abuse of minors made against him had already been forwarded to the Vatican. Cardinals Donald Wuerl and Timothy Dolan, both members of the board, were aware of the allegations.
McCarrick served on APSA’s board until 2010, when he was required to retire after turning 80. After 2010, McCarrick continued to serve as the U.S. representative for the Fondazione Centesimus Annus Pro Pontifice, a non-profit group controlled by APSA, a role he maintained until his public disgrace following the publication of allegations of sexual abuse in 2018.
CNA has reported that the APSA loan was coordinated by Cardinal Angelo Becciu, then the sostituto at the Secretariat of State, and contravened internal policies and international regulatory agreements. CNA has also reported that APSA eventually wrote off 30 million of the 50 million euro loan.
The loan from APSA came after the same proposal was denied by IOR, the Vatican’s custodial bank which provides banking services to religious orders and curial employees, after its president, Jean-Baptiste Douville de Franssu, along with Cardinal George Pell vetoed the plan, concluding that the IDI would be incapable of repaying the loan.
McCarrick’s letter said that information concerning the IDI’s outstanding debts, and history of fraud and embezzlement was “unverified” and had “caused serious damage to the Foundation.”
McCarrick suggested that lay board members defer to the foundation’s cardinal members to “repair any damages that may have been done” to the credibility of the Papal Foundation and the grant request, and “clarifying your position.”
While lay members of the foundation’s board were nearly unanimous in opposing the grant request, the bishop and cardinal members of the board outvoted them, and in December 2017, the grant request was approved.
Two initial installments of the grant were sent to Rome in late 2017 and early 2018, totaling $13 million. After internal disagreements about the grant went public, Cardinal Donald Wuerl, charged with presenting the proposal, said he would ask the Vatican to cancel the request and return the funds.
In early 2019, Cardinal Pietro Parolin, Vatican Secretary of State said the $13 million would be reclassified as a loan, rather than a grant, and would be repaid through "discounts" applied each year to the list of grants requested of the Papal Foundation by Vatican offices and Catholic apostolates.
“The poor will end up paying the debt,” a source close to the Papal Foundation told CNA.
One senior APSA source blamed the breakdown of the Papal Foundation grant on what he believed to be anti-Francis sentiment among Papal Foundation board members.
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“All these objections raised about IDI not being like the normal grant recipients are just justifications,” he told CNA. “If this had been a request from Benedict or John Paul II, they would have sent the money without thinking about it.”
Asked if the grant request had actually come from Pope Francis, if the pope had endorsed the request, or if he knew of the undisclosed purpose of offsetting the APSA loan, the official said it was “immaterial.”
“So far as the Papal Foundation should be concerned, if the Secretariat of State asks, it is the pope asking, refusing is to refuse the pope.”
McCarrick was convicted by the Holy See of sexually abusing minors and seminarians and laicized earlier this year. McCarrick is living in seclusion at a friary in Kansas and is unavailable for comment.