Concetta Fierravanti-Wells (NSW, Liberal Party) Share this | Link to this | Hansard source

Yesterday evening I gave background to the case against Cardinal Pell, former Archbishop of Sydney and Prefect of the Secretariat for the Economy in the Vatican. Today I continue the story by highlighting how Pell's serious efforts at financial reform brought him up against powerful forces determined to remove him. These were not Pell's only enemies, but they were formidable ones who were, for a time, successful.

The new economic framework for the Holy See saw major changes to the Administration of the Patrimony of the Holy See, APSA, transferred to the Secretariat for the Economy, to the Vatican's pension funds, to the Vatican media and to the Vatican bank. Pell became the economic tsar. The documents were in English rather than the traditional Italian. The Vatican's vast patrimony, including its property investments, became open to scrutiny. The Vatican old guard were not happy. By the end of his first year as prefect, Pell had put into place measures for financial competency and transparency and imposed key elements and structures of the new economic framework which became the Secretariat for the Economy and Council for the Economy. He brought in an auditor-general for independent oversight, something that had never been done or thought necessary before. In November 2014, he distributed a new handbook to all Vatican offices instituting financial management policies from 1 January 2015. Pell said at the time:

The purpose of the Manual is very simple. It brings Financial Management practices in line with international standards and will help all Entities and Administrations of the Holy See and the Vatican City State prepare financial reports in a consistent and transparent manner.

Shortly after reporting in December 2014 that substantial funds—around 1.6 billion euros—were not being reported on the Vatican's balance sheet, in February 2015 the 'first strike' against the reform was launched by the Vatican's old guard. Cardinal Coccopalmerio, President of the Pontifical Council for Legislative Texts, challenged the scope of the authority given to the secretariat and to Pell himself. He questioned the consolidation of management in the secretariat and the demand for transparency across Vatican entities. Coccopalmerio succeeded in seeing the statutes of each of the entities of the secretariat, the council and the auditor-general re-dimensioned. Pell's secretariat lost power over Vatican properties, making it more difficult to discover malfeasance.

The reasons for this move are now obvious, with the recent downfall of Cardinal Becciu. In June 2015, former chairman of Deloitte Italy, Libero Milone, was announced as inaugural Auditor-General of the Vatican. With his appointment, the investigative arm of the economic blueprint was put in place. The reform was gaining ground but the opposition was mounting, with increasing complaints about Pell's 'Anglo management style' and delays in compliance by Vatican entities. These were explained away as uncertainty about the completely new approach, despite resources being made available from the new financial bodies to assist with compliance.

Pell placed the final plank in the economic reform in December 2015 with the first ever audit of the entire Vatican finances by PricewaterhouseCoopers, to approval from financial experts worldwide. Becciu had every reason to oppose this audit, as it would uncover that the Secretariat of State had effectively run its own bank, which was being administered principally by Becciu himself. Moreover, Becciu has been linked to a number of highly speculative financial deals involving London property. These are alleged to have benefited not only the financiers involved in the deals but even members of Becciu's own family. As more details emerge, it is hoped that cooperation between Vatican authorities and governments around the world, including Australia, will elicit the destination of Vatican funds in those countries.

The year 2016 became the year of bringing Pell down. First, his enemies questioned whether he had the power to do something in the Vatican, a typical old guard move. Cardinal Parolin, appointed in 2013 as Secretary of State, was known for his outspoken opposition to the Pope's efforts at financial reform. Media reports outlined the extent of their clashes. In April 2016, Parolin, backed by Becciu's directive to all Vatican entities, suspended the comprehensive audit. Another blow came in July 2016 when, by a 'motu proprio' legislative act, the Pope removed some of the powers invested in the Secretariat for the Economy, giving them back to APSA, including its data centre and authority over property and staff payments. APSA's president, Cardinal Calcagno, was considered to be corrupt, with media reports of alleged misappropriation of funds and covering up child abuse in his former diocese. APSA itself had been a centre of money laundering, with the infamous case of Nunzio Scarano, otherwise known as 'Monsignore Cinquecento'—Monsignor 500—as a result of his penchant for money and an expensive lifestyle.

Many of the financial questions about APSA remain unresolved to this day. On numerous occasions, Pell, aware of these questions of continued corruption, had been assured that Calcagno would be removed. In typical Vatican style, he eventually would retire without investigation. It is worth noting that the powers handed to APSA and away from Pell and his secretariat were restored to the Secretariat for the Economy in May 2020, upon Pell's acquittal. Pell's successor, Father Guerrero, succeeded in convincing the Pope that there was an obvious conflict of interest if APSA retained the ability to alter data pertaining to financial transactions.

At this time, unbeknownst to Pell, authorities in Australia were investigating complaints against him. It is important to note the timing, as it coincided with mounting resistance to Pell from Vatican officials. In October 2016 Shane Patton, then the Victorian deputy police commissioner, and other officers travelled to Rome to interview Pell. This interview is available on the public record. Pell's demeanour in the interview demonstrates an innocent man detailing how preposterous and impossible it was for the crimes to have occurred as alleged.

In Rome, APSA continued its further opposition to the financial reforms. In May 2017 its secretary sent a letter to all dicasteri, or ministries, telling them to refuse to submit their accounts to the external auditor. Pell and Milone also sent letters, insisting on their mandate to require that dicasteri comply with the established norms. The secretariat was uncovering serious irregularities and wanted to proceed.

On 19 June, just a few weeks after Pell foreshadowed privately that a 'moment of truth' for those involved in financial corruption was coming, Milone's office was raided by the Vatican police. Becciu accused him of spying on the Secretariat of State. Milone was interrogated and, on the next day, announced his resignation. He said sometime later that he had been threatened with arrest if he did not resign. Nearly a year later this outlandish allegation was quietly dropped, with Milone suing the Vatican for loss of employment and damages.

On 29 June 2017 then Deputy Commissioner Patton announced that Victoria Police was charging Pell with multiple offences. On the same day, Pell stated that he would return to Australia for his day in court in order to fight the charges, declaring, 'I am innocent of these charges.' It should be made clear that Pell returned to Australia voluntarily. He could have remained in Rome, as his diplomatic status preserved him from facing trial. But that is not in his character.

On 10 July 2017 Pell left Rome. Effectively the economic reform was over. There is an old saying in the Vatican: whatever happens, never leave Rome or you admit defeat. Pell, it seems, had lost. In essence the Vatican enemies had prevailed. In an article earlier this year titled 'Operation Get-Pell; were the bullets made in Rome?', Kathy Clubb referred to an article from March 2019 by Vatican insider Marco Tosatti, titled 'The cannons in Australia, the bullets manufactured in the Vatican'. By this, Tosatti referred to remarks from clergy in Rome that, while the alleged crimes were in Australia, the prime movers behind 'Operation Get Pell' were in Rome.

Through my recent correspondence with AUSTRAC and questioning of AUSTRAC at estimates, we know allegations of suspicious transfers from the Vatican to Australia were investigated and that 'actionable financial intelligence' passed to the AFP and Victoria Police. On 21 October I wrote to AFP Commissioner Kershaw and Victoria Police Commissioner Patton about this matter. I was disappointed to read media reports only two days later that Victoria Police had noted advice from AUSTRAC but stated, 'We are not at this time conducting any further investigations.' We will discover in coming weeks the possible motives for quietly archiving intelligence and refraining from conducting any further investigation. We must rely on the continued investigation of the AFP to get to the bottom of this complicated affair.

For many Australians there are unresolved issues that require examination, including the role of Pell in the Catholic clergy abuse crisis, the role of Victoria Police and Operation Tethering, and the financial connections between individuals and entities in Australia and the Vatican. They also have legitimate questions about the media's vilification of Pell and the role of clergy and lay Catholic opponents of Pell. Understanding this will help us determine how bullets forged in the Vatican resulted in cannons being fired in Australia. To be continued.