August 3, 2021

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The most corrupt nation state in Western Europe occupies only 120 acres of land and has fewer than 1,000 residents. But its capacity for initiating criminal behaviour, and the global consequences of the financial and sexual scandals in which it’s entangled, are hugely out of proportion to its size.

That’s because, around the world, roughly a billion people traditionally regard the state’s geriatric absolute monarch as God’s representative on earth. They may have been aware that, for centuries, a few bad apples in the administration have betrayed the monarch’s trust by embezzling money. But the notion that the whole state was slowly turning into a criminal enterprise would have struck them as ridiculous, even sacrilegious.

Until now.

We’re talking about Vatican City, of course. Visitors to Rome are often sceptical of the notion that this walled enclave behind St Peter’s, less than half the size of Hyde Park, is really an independent country.

They shouldn’t be. If you’ve ever stayed there, as I have done, you’re left in no doubt that when the Swiss Guards wave you through, you’re stepping beyond the reach of the Italian republic. It’s especially true at night, when your footsteps echo in the desolate courtyards.

The Vatican has its own legal system, criminal investigators, gendarmerie and jail cells. And it doesn’t hesitate to use them. When Pope Benedict XVI’s butler, Paolo Gabriele, was sentenced to jail for aggravated theft in 2012, he served his time in a cell in the Vatican police barracks.

That was a significant conviction. Gabriele had leaked documents alleging bribery and blackmail affecting the Pope’s closest advisors. The resulting “Vatileaks” scandal is suspected to have inspired Benedict’s decision to resign the papal office in despair in 2013.

The cells were occupied again in 2016, when Monsignor Lucio Balda, a high-ranking financial official, served several months there after being convicted of leaking confidential documents to journalists who claimed that the Vatican was engaged in massive property fraud.

At the time of Balda’s arrest, the international press settled on a clear narrative: the Vatileaks scandals showed the scale of the challenge facing Pope Francis as he set about cleaning up the finances of the Holy See. Benedict was weak and craven; his successor fearlessly committed to reform.

That narrative, or at least the part relating to Francis, was soon torn to shreds by events, though the Left-leaning Vatican press corps — utterly smitten by the Argentinian pontiff — was reluctant to draw the appropriate conclusions.

On 18 June 2017, Vatican gendarmes raided the offices of Libero Milone, former CEO of Deloitte in Italy, who had been appointed the Vatican’s first auditor-general at the instigation of Cardinal George Pell, an Australian prelate whom Francis put in charge of reforming finances. The Oxford-educated Pell had the reputation of a bruiser who specialised in detecting bullshit; his appointment was greeted with queasy alarm by the Vatican’s old guard.

At the time of the raid, however, Pell was preparing to return to Australia to face what turned out to be completely false charges of molesting two boys in his Melbourne cathedral in the Nineties. He was convicted of the offence at a retrial and was imprisoned until April 2020, when Australia’s High Court threw out the charges and acquitted him.

But he was obviously no use to Milone as an ally when, to general astonishment, the highly respected auditor-general was threatened with detention in a Vatican jail cell by Archbishop Giovanni Becciu, 73. As day-to-day administrator of the Secretariat of State, Becciu was effectively Pope Francis’s chief of staff.

Becciu accused Milone of carrying out unauthorised investigations into the affairs of top Vatican officials. But that was precisely why Pell had brought him in: he wanted to know about secret bank accounts controlled by Becciu, one of which was linked to a disastrous £300 million property investment in Chelsea. Pell was Becciu’s arch-enemy.

So the Australian may well have felt grim satisfaction last week, as Becciu — incredibly, and disgracefully, made a cardinal by Francis in 2018 — was charged in a Vatican courtroom with embezzlement and abusing his office. He’s also specifically charged with trying to force a monsignor to withdraw evidence he gave about the London property deals.

The case was adjourned until October 5, and that’s fair enough: defence lawyers need time to go through 28,000 pages of documents relating to 10 defendants. According to the Daily Mail, the 487-page indictment against them “sheds light on hefty bank transfers, text messages between collaborators from seized cellphones – even bags of money changing hands and secret meetings in luxury hotels”.

Note that it’s the Vatican itself that has gathered evidence against Becciu and his alleged co-conspirators. And it’s true that from 2018 onwards the Secretariat of State, the Pope’s civil service and foreign office, went after Becciu relentlessly on the orders of his former boss, Secretary of State Cardinal Pietro Parolin.

But Parolin had little choice. The rumours surrounding Becciu were becoming more extravagant by the day, which made Francis’s decision to give him a cardinal’s hat even more mysterious.

Many of those rumours are now firm allegations. Ed Condon, editor of The Pillar, a new US-based Catholic news service, has been gathering evidence against Becciu for years — but even he is taken aback by “the sometimes surreal details alleged by prosecutors about some of the supposed ‘investments’ that have been made, including, in one case, a seven million euro investment in the construction of a U.S. motorway that simply didn’t exist”.

Most people first learned of the scandals when they read about the ruinous London property development. “But now the dam has properly broken,” says Condon. “We are seeing the various people charged turn on each other — in the run up to the trial, we’ve had allegations of blackmail, threats of violence and extortion.”

The nightmare for the Vatican is that the defendants aren’t just turning on each other: they’re turning on Cardinal Parolin, who is disliked by many of the faithful for negotiating a deal with China that forced loyal underground Catholics to join Beijing’s puppet “Catholic” Church.

All the signs are that the defence plans to own up to squandering Church money on lunatic speculation — but to claim that Parolin, Becciu’s boss, signed off on the deals. And perhaps they will go further. Becciu’s lawyers have already suggested that Francis himself knew about the London investment.

Is the Pope nervous? Consider one strange detail. When Vatican prosecutors confronted Francis with the evidence against Becciu in 2020, he sacked him from his new job running the Church’s saint-making department, and also stripped him of many of the privileges that go with the rank of cardinal. It was a brutal defenestration, suggesting that Francis had flown into one of his rages, never reported by a compliant press but all too familiar to Vatican staff.

Then, in the week before Easter this year, the Pope chose to celebrate the Holy Thursday liturgy not in St Peter’s but with Cardinal Becciu, in the latter’s private chapel. Was this a radical demonstration of Francis’s much-advertised “mercy”, as official sources claimed, or an ingenious act of damage limitation before the trial started? Perhaps a bit of both?

One thing we know about this Pope’s mercy is that it’s very selective. For a man never suspected of personal corruption or sexual misdemeanour, he’s oddly indulgent of deeply compromised figures. There is a long list of prelates accused of embezzlement, sex abuse or cover-ups who have been protected or rehabilitated by Francis.

The most notorious example is ex-Cardinal Theodore McCarrick, a suspected serial sex abuser who was brought out of retirement by Francis to act as his international emissary. McCarrick was a fundraiser of genius, and was allowed to carry on until the media got wind of claims that he’d abused a minor. As for the $600,000 that “Uncle Ted” handed over as gifts to favoured clerics, who knows where it ended up? In the Vatican no one asks.

This grotesque culture of corruption wasn’t instigated by Francis: things were as bad under Benedict XVI and John Paul II. But neither of those popes were as hot-tempered as Francis, who has just savagely clamped down on the Latin Mass because he considers it too right-wing, and neither of them faced the prospect of a trial in which an unscrupulous cardinal and his former associates will sing like canaries.

Will we learn that Becciu conspired with Australian prosecutors to get Pell jailed on trumped-up charges? Will it shed light on the shameful China deal? The latest theory is that Beijing got hold of the details of the use of the gay hook-up Grindr by Vatican dignitaries and blackmailed the Secretariat of State.

What we can say is that we are well into the second half of Francis’s pontificate — he’s 84 and in fragile health. From October, the trial will overshadow everything, and even if there’s no evidence of the Pope’s complicity in the scandals it’s clear that the proposed reforms that got him elected eight years ago have come to nothing.

The next Pope will inherit a Church whose reputation, finances and internal unity have been destroyed. For the first time in living memory, most of the cardinals processing into the Sistine Chapel to elect Francis’s successor will be praying that the Holy Spirit doesn’t give them the job.