News Column

German Aristocrat Appointed New Head of Vatican Bank

Feb 15, 2013

Alvise Armellini


Ernst von Freyberg, a lawyer from a well-known German aristocratic family, is the new head of the Institute for Religious Works (IOR), the Vatican's bank, it was announced Friday.

Introducing greater transparency is expected to be high on the list of priorities for the new president of the IOR, the 70-year history of which has been tarred by a long line of scandals.

These have included allegations of fraud, money laundering and even the mysterious disappearance, three decades ago, of a teenage girl in Rome.

The 54-year-old von Freyberg, who uses the title baron, was appointed by the five cardinals who oversee the bank after a selection process overseen by Spencer Stuart, an international head-hunting firm the Vatican had turned to for help with filling the vacancy.

The top position at IOR had been vacant since May, when Italian banker Ettore Gotti Tedeschi was abruptly dismissed by the bank's lay supervisors in circumstances that have never been fully explained.

The Vatican said that von Freyberg - founder of Daiwa Corportare Advisory GmbH, a German financial consulting firm which he led until last year - has "vast experience of financial matters and the financial regulatory process."

Von Freyberg is also a member of the 900-year-old Catholic Order of the Knights of Malta and organizes German pilgrimages to the Catholic shrine of Lourdes in France.

Based in Frankfurt, von Freyberg will be in Rome three days a week to follow IOR business, Vatican spokesman Father Federico Lombardi said. He will retain the chairmanship of the Blohm+Voss shipyards, a firm that supplied warships and airplanes to Germany's Nazi regime.

After World War II, the company continued working on military contracts, although its main focus is now on civilian shipbuilding and repair. It is currently part of a consortium building four frigates for the German navy.

Batting away questions about the connection, Lombardi said it was "dishonest" to paint von Freyberg "as a warmonger" and insisted that he was "an absolutely apt person" to lead IOR, who had been chosen "at the end of a very careful process" of vetting.

Pope Benedict XVI "closely followed" the deliberations, knows von Freyberg's family and "has expressed his full consent" to the nomination, but "did not intervene in any way" to influence the decision, the spokesman said.

Italian media have speculated that Benedict - who is due to resign on February 28 - wanted a new head to be installed at the IOR before a new pope is elected, in order to influence the future course of the Vatican bank.

The Vatican is trying to get on a "white list" of states fulfilling international standards of financial transparency set by the Organisation for Economic Co-operation and Development.

The push came after Italian magistrates started investigating the IOR in 2010, citing possible violations of anti-money laundering norms. The Vatican denies all wrongdoing.

Last year, inspectors from the Moneyval committee of the Council of Europe said the Vatican had come a long way on financial transparency, but still only met nine out of 16 international core standards on the issue.

Furthermore, the Bank of Italy last month blocked credit and debit card payments in the Vatican because of lack of transparency concerns. The blockage was circumvented this week through a deal with a Swiss card payments firm.

Lombardi said there was a "very clear determination" to implement all corrective actions suggested by Moneyval. "The new president of IOR is aware of this."

Source: Copyright 2013 dpa Deutsche Presse-Agentur GmbH

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