Tue

24

Mar

2015

Reforms For New Vatican Financial Offices Go Into Effect

by Sofia Infante

 

On March 1, reforms regarding three key Vatican oversight bodies went into effect. The move is a part of Pope Francis’ financial reform plan and largely consolidates power in the hands of Australian Cardinal George Pell, who was appointed head of Pope Francis’ financial reform plan. The reforms provide a new legal framework for the three new financial oversight committees instituted by Pope Francis in 2014: The Council for the Economy, the Secretariat for the Economy, and the Office for the General Auditor. The system’s structure consigns supreme authority to the Pope, under who is the head of the Council for the Economy, which instructs the Secretariat for the Economy.

The statues, which were developed over the period of a year beginning in 2014, define the role, management, structure, and responsibilities of the oversight bodies. The Council consists of 15 members appointed by the Pope with 5-year terms and equal voting rights, of which eight will be cardinals or bishops and seven laypersons with knowledge and background with economic, financial, law, and administrative matters. In an attempt to “represent the universality of the Church”, the members will be of different nationalities. The Council will be responsible for overseeing the budget reports of all the offices and organizations of the Vatican and submitting recommendations for them to be approved by the Pope.

 

The Secretariat for the Economy, which is currently directed by Cardinal Pell, will be in responsible for supervising all financial and administrative activities and will implement the suggestions made by the Council for the Economy. It will monitor activities of the dicasteries and other Vatican agencies while funding pre-approved programs. Further, it will be divided into two distinct sections: the first overseeing financial oversight and controls and the second will handle the administrative activities in the Vatican.

 

The third component of the oversight bodies is the Office for the General Auditor, an independent and autonomous office that will consist of a general auditor (director) and two assistant auditors. It will be responsible for investigating signs of corruption or abnormal activity. If these suspicions are substantiated, the Office will submit a report to the Financial Information Authority or FIA, the Vatican’s anti-money laundering and anti-terrorist financing agency, which was instituted in 2010. Notably, the statutes provide safeguards for potential whistleblowers, indicating that sincere and reasonable suspicions will “… not produce any kind of culpability for violating professional secrets.” Further, the statutes state that the Auditor General’s Office may request information from the Council or the Secretariat and other Vatican offices.

 

Both the Secretariat for the Economy and the General Auditor’s Office report to the Council for the Economy. These economic reforms stem from increased efforts for financial transparency that began with Pope Benedict XVI. The statutes were approved ad experimentum, i.e. on a trial basis, allowing for further alterations if necessary.

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