Pope Francis names new head of Vatican financial authority

Carmelo Barbagallo comes in amid London property scandal

(ANSA) - Vatican City, November 27 - Pope Francis on Wednesday named a new head of Vatican financial information authority AIF after the previous one's tenure was not renewed following a scandal involving a London property deal allegedly funded with Peter's Pence. The pontiff named Carmelo Barbagallo, until now a Bank of Italy high consultant on banking and financial oversight and relations with the Single Supervisory Mechanism, in place of René Brülhart.
    Brülhart's term ended last week. "I am honoured to have received this appointment, aware of the full weight of the moral and professional responsibility it carries, and I thank the Holy Father for the trust he has placed in me", the new President of the Financial Information Authority, Carmelo Barbagallo, said when speaking to Vatican News after publication of the news of his appointment.
    "In carrying out my service of responsibility in leading the AIF", Barbagallo added, "I will work to bring all my experience accumulated in forty years working at the Bank of Italy, as an inspector, as head of vigilance of the Italian banking and financial sector and in the context of the supervision of the European banking system." "I am sure", he explained, "that the AIF will be able to give its own contribution in its role as a supervisory authority, so that the fundamental values of fairness and transparency of all the financial movements in which the Holy See is engaged may continue to be affirmed and recognized." "I intend to reassure the international system of financial information", the President of the AIF concluded, "that all cooperation will be given in full respect of the best international standards. I will be at work already today to ensure continuity in the work of the AIF in pursuing its important institutional objectives." For its part, Bank of Italy, in a statement, said: "Today His Holiness Pope Francis appointed Carmelo Barbagallo as President of the Financial Information Authority of Vatican City.
    "Carmelo Barbagallo, in his long professional career at Bank of Italy, has gained extensive experience in the field of banking supervision. Since 2014 he has been head of the Supervision Office and in July of this year he was appointed as consultant to the Directory for relations with the Single Supervisory Mechanism (SSM), the structure that oversees the major European banks.
    "Bank of Italy expresses its deep appreciation for the work carried out in recent years with dedication and competence by Carmelo Barbagallo. His appointment consolidates the fruitful relationship of collaboration that has existed for some time with the Vatican Authority." Biography of Carmelo Barbagallo: Born in Catania on 28 February 1956, married with two children. In 1978 he was awarded a degree in Law with honours from the University of Catania; in 1979 he completed a post-graduate course in Regional Economics and collaborated with the chairs of Private Law and Industrial Law. He is a qualified auditor.
    In 1980 he joined the Bank of Italy and was appointed to the Supervision Office of the Genoa branch. After performing his military service as an officer in the Finance Police, in 1983 he was transferred to the Milan branch, where he worked in the Economic Research Unit and the Supervision Office, focusing on the real economy of Lombardy and the analysis of banks of national interest (Banca Commerciale Italiana and Credito Italiano) and investment funds.
    From 1985 onwards he worked in the Supervision Inspectorate at the Bank of Italy's Head Office. In this period he was responsible for organizing training courses and participated in numerous working groups. Among other matters he was concerned with impaired and restructured loans and contributed to the drafting of the 1993 Consolidated Law on Banking. He was also a member of various selection committees for the Bank of Italy's hiring of young graduates.
    As a supervision inspector he was responsible for several on-site examinations at banks and financial intermediaries, in Italy and abroad. Among other matters he was concerned with the validation of advanced risk-measurement models provided for by the Basel Accord. He oversaw the preparation of the current version of the Guide to Supervisory Activities.
    In January 2009 he was appointed Deputy Head of the Supervision Inspectorate and in May 2011 he was made its head. In February 2013 he was appointed Managing Director for Banking and Financial Supervision.
    From 27 January 2014 to 30 June 2019 he was Director General for Financial Supervision and Regulation.
    As of 1 July 2019 he is Managing Director responsible for high-level consultancy to the Governing Board on matters of financial supervision and regulation and for relations with the Single Supervisory Mechanism (SSM).
    He has written numerous articles on banking and financial subjects, with special reference to questions regarding financial innovation and the supervision of derivative instruments.
    Barbagallo's appointment came a day after Francis, on the flight back from a trip to Thailand and Japan, said things were done that "don't seem clean to me" about the acquisition of a property in London at the centre of the latest Vatican financial scandal.
    He said there was a "presumption" of corruption in the affair, and that questioning would take place soon.
    Cardinal Angelo Becciu, the assistant Vatican secretary of state, on October 29 rejected charges against him in the Vatican probe into a property deal in London.
    "They are slanderous charges that I reject in a firm and indignant way. My conscience is clear and I know I have always acted in the interest of the Holy See and never in my personal one. Those who know me well can attest to that", he told ANSA.
    The charge he rejected most forcefully was "portraying me as someone who played with and tampered with the money of the poor".
    "In the Secretariat of the State we had a fund entitled 'money of the poor'. And it was destined for the poor. If, on the other hand, for money of the poor they want to refer to Peter's Pence, we have to clarify.
    "The Pence is not only for the pope's alms giving but also the funding for his Pastoral ministry".
    Vatican Secretary of State Cardinal Pietro Parolin said earlier Tuesday that he was confident Vatican investigations will "shed light" on the "opaque" use of Peter's Pence for a property deal in London.
    The deal is at the centre of a probe which saw investigators this month raid the offices of two Vatican departments, the Financial Information Authority (AIF) and the Secretariat of State, and the preventative suspension of five employees, one of whom has since been reinstated.
    When asked about how the Catholic Church's money is managed, Parolin replied "I think it is well administered".
    The Secretariat reportedly invested around $200 million for a stake in a project to buy a building in Chelsea and convert the property into luxury apartments in 2014.
    It reportedly bought up the rest of the project in 2018.
    Becciu told ANSA "why should (the transactions) be opaque?" "It is accepted practice for the Holy See to invest in property, it has always done so: in Rome, in Paris, in Switzerland and also in London.
    "Pius XII was the first to acquire property in London. We were advanced this proposal on this historic and artistic building and when it was done and realised there was nothing opaque. The investment was regular and registered according to law".
    He said "the difficulties started with the majority partner, with whom I believe issues regarding the management of the liquidity arose.
    He did not cite the manager of the fund, Raffaele Mincione.
    "He, in fact, ignoring the indications reiterated on numerous occasions, also in writing, continued to invest in assets that the Secretariat of State could not absolutely share or approve", said Becciu.