* Gotti Tedeschi accused of negligence, mismanagement
* Ousted banker says paying price for transparency
* Vatican trying to restore image after money laundering
By Philip Pullella and Paolo Biondi
VATICAN CITY, May 25 In the type of drama that
rarely filters out of the Vatican, the president of its bank has
been ousted by a board of external financial experts who voted
no confidence in his leadership.
Ettore Gotti Tedeschi, who was shown the door on Thursday
night as president of the Vatican bank formally known as the
Institute for Works of Religion (IOR), claimed he is a victim of
his efforts to make the bank more open.
Gotti Tedeschi told Reuters: "I have paid for my
The Vatican denied this, saying he had been ineffective and
Gotti Tedeschi, a conservative Catholic who once worked for
Spain's Banco Santander, was IOR president since 2009 and is a
high-profile figure in Italy.
He wrote editorials about financial ethics for the Vatican
newspaper and other publications and often appeared at
conferences about business ethics.
A statement said the board moved against him because he "did
not carry out functions of primary importance for his office".
The bank will seek a new president who can "re-establish
full and effective relations between the Institute and the
financial community, based on mutual respect of internationally
accepted banking standards", it said.
The board which ousted Gotti Tedeschi includes Carl
Anderson, the American head of the international charity group
Knights of Columbus, Ronaldo Hermann Schmitz, formerly a top
executive at Deutsche Bank, Manuel Soto Serrano of Banco
Santander and Antonio Maria Marocco, a prominent Italian notary.
A source familiar with events surrounding the ouster said
the board repeatedly had pleaded with Gotti
Tedeschi to become more knowledgeable about the daily
running of the bank, to get to know its managers better and
spend less time in the media spotlight.
The person said the move was "definitely not" an attempt to
put the brakes on efforts towards greater transparency, adding
that foreign ambassadors accredited to the Vatican have been
visiting the bank as part of its drive to show that it is as
open as can be.
He rejected any suggestion by Gotti Tedeschi that the other
four board members were trying obstruct transparency.
The Vatican bank, founded in 1942 by Pope Pius XII, has been
in the spotlight since September 2010 when Italian investigators
froze 23 million euros ($33 million) of its funds in Italian
banks after opening an investigation into possible
The bank said it did nothing wrong and was just transferring
the funds between its own accounts. The money was released in
June 2011, but the investigation is continuing.
The allegations were seen as a setback to the Vatican's bid
to be included in the so-called "white list" of states which
comply with international standards against tax fraud and
money-laundering. A decision on its inclusion is expected this
The Vatican recently adopted new financial transparency laws
and set up internal regulations to make sure its bank and all
other departments adhere to international regulations and
standards, and cooperate with foreign authorities.
The 108-acre sovereign state surrounded by Rome says it now
complies with the rules of the Paris-based Financial Action Task
It also established an internal Financial Information
Authority (FIA) along the lines of other countries and has
committed to comply with international anti-money laundering
standards and liaise with the group and law enforcement
In January, Italian newspapers published leaked letters that
pointed to an internal debate as how the law should be
structured to best comply with international standards.
The IOR was entangled in the collapse 30 years ago of Banco
Ambrosiano, with its lurid allegations about money-laundering,
freemasons, mafiosi and the mysterious death of Ambrosiano
chairman Roberto Calvi - "God's banker".
The IOR then held a small stake in the Ambrosiano, at the
time Italy's largest private bank and investigators alleged that
it was partly responsible for the Ambrosiano's fraudulent
Several investigations have failed to determine whether
Calvi, who was found hanging under Blackfriars Bridge near
London's financial district, killed himself or was murdered.
The IOR denied any role in the Ambrosiano collapse but paid
$250 million to creditors in what it called a "goodwill
(Reporting By Philip Pullella; Editing by Michael Roddy)