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article imageVatican priest arrested in alleged plot to smuggle $26M to Italy

By JohnThomas Didymus     Jun 29, 2013 in World
Rome — The Vatican bank says it is cooperating with police investigators following the arrest of a top Vatican official Monsignor Nuncio Scarano, in an alleged plot to smuggle $26 million into Italy from Switzerland in a private jet.
In the latest scandal to hit the Vatican, Scarano, 61, was arrested on Friday in a parish outside Rome along with a senior secret service agent Giovanni Zito and a financial broker Giovanni Carenzio. Scarano was taken to the city's Queen of Heaven jail, on suspicion that he conspired to help rich friends smuggle 20 million euros ($26 million) into Italy from Switzerland.
Prosecutor Rossi identified the "friends" as members of the Italian shipping family d'Amico, who held the money in a Swiss bank in Carenzio's name apparently to avoid paying Italian taxes.
AP reports that Max Hohenberg, a spokesman for the Vatican bank, said Vatican authorities were assisting investigators and have launched internal investigations into the incident.
The Vatican official's arrest is the latest scandal to hit the Vatican. It comes only two days after Pope Francis constituted a commission of inquiry to investigate decades-old allegations of corruption and fraud in the Vatican bank, formerly known as the Institute for the Works of Religion (IOR). The allegations have sullied the image of the Vatican and led to the Vatican bank being dubbed in ridicule as the "the world's holiest bank."
According to AP, Scarano's lawyer Silverio Sica said the $26 million never left Switzerland. He explained that Scarano was only acting as a middleman. Friends had asked him to assist in recovering the 20 million euros they had given Carenzio to keep.
Prosecutor Nello Rossi gave reporters details of a complicated plot uncovered through telephone wiretaps:
According to The New York Times, Zito, a top Italian secret service agent and member of the military police's agency for security and information took a sick leave from his job on July 2012, rented a private plane and flew with the broker Carenzio to Locarno in Switzerland. The plan was that Carenzio would withdraw the cash from his bank account and hand it over to Zito, who would use his connections as a top member of the Italian Carabinieri to bring the cash back to Italy without being stopped at the airport customs area. He would then carry the money straight to Scarano's apartment in Rome without paying custom fees and with no official record of the sum being brought into Italy.
The daring plan involved using an armed police armored convoy that would escort Zito with the money issued in high denominations to Scarano's apartment in Rome, according to prosecutor Rossi.
The plot was aborted when the broker lost his nerve and refused to go along with the plot. Zito returned to Italy empty-handed but insisted on collecting his commission of 600,000 euros. Scarano was obliged to write a check of 400,000 euros which Zito deposited. Scarano then wrote a second check of 200,000 euros, but as a ruse to stop Zito from depositing the check he filed a report claiming that a 200,000 euros check was missing. The action led to Scarano being accused of slander because he was the one who wrote the check and gave it to Zito.
Scarano's arrest follows his suspension from his position as a senior accountant with the Vatican Administration of the Patrimony of the Apostolic See (APSA), after prosecutors in his hometown city of Salerno in southern Italy launched investigations into a separate case involving allegations of money-laundering within the Vatican bank.
The case involved a transaction from his IOR account in 2009 when as an official at the Administration of the Patrimony of the Apostolic See (APSA), he drew 560,000 euros ($729, 000) and carried it in cash out of the Vatican to Italy and used it to settle a mortgage on his home in Salerno.
The money was paid into his account by rich friends and donors who believed they were donating to a project to build a home for the terminally ill in Salerno.
Scarano reportedly deposited the money in an Italian bank through friends who accepted 10,000 euros each in exchange for checks in the same amount. Scarano them deposited the checks in an Italian account.
According to his lawyer, Silverio Sica, Scarano intended to pay the money back. He only used it to settle his mortgage so he could sell the property and use the proceeds to build the home for the terminally ill. But so far the care home has not been built.
Meanwhile, the Vatican has said through its spokesman Federico Lombardi, that it is cooperating with investigators and that Vatican financial authorities are conducting their own investigation into the matter and would take appropriate actions based on their findings.
The latest scandal is seen as a test for Pope Francis who has said he will not tolerate corrupt officials. Francis has portrayed himself as a champion of the "poor," saying that "St. Peter never had a bank account."
Scarano and his co-plotters face up six years in prison, if found guilty of the charges.
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