US Press Still Ignoring JPMorgan’s Biggest Money Laundering Offenses
The Vatican has been embroiled in conspiracy since the Vatileaks scandal of last Fall. And, currently, the trial of the butler of Pope Benedict, who is accused of leaking secret documents, is underway. Motivated by a desire to expose corruption and greed from within, the butler released the documents to journalists. In them, skulduggery and intrigue at the highest levels of the Catholic Church should have served to surprise nobody. Mr Gabriele, the defendant, said he was appalled by the “evil and corruption” of the Church, which he called “the kingdom of hypocrisy.” What is being missed by the US media, to be sure, is the closeness of the US’s biggest bank, JPMorgan, to Vatican City disregard for moral hazard and law. Sure, the press has recently covered JPMorgan failing to comply with anti-money laundering laws, but JPMorgan has been implicated (not legally) in a laundering scandal much more grave than the ones being investigated by US authorities. While currently the Office of the Comptroller of the Currency is looking into JPMorgan’s systems designed to monitor money laundering, there has been no word in the US press (except for here at Silver Vigilante) regarding JP Morgan laundering money for the Vatican.
In 2009, the year Gotti Tedeschi took over as president of the IOR, the bank opened up an account with the Milan-based branch of JPMorgan Chase. According to Spiegel:
From that point on, millions started flowing on an almost daily basis from JPMorgan’s Milan office to the one in Frankfurt, where the IOR also had a JPMorgan account. Vatican officials opted for a special account in Milan with the number 1365, a so-called “sweep facility account,” which was automatically zeroed out at the end of each day. The Vatican bank confirmed the existence of this account late last week, though it said it was primarily used for handling securities transactions.
This financial account allegedly processed more than a billion euros for the Vatican bank through last year. Italian investigators suspect the account was used to launder funds from “dubious sources.” According to the strict anti-money-laundering laws to which financial institutions are supposed to be held, JPMorgan should be considered a primary suspect in massive money-laundering operations in Europe, centered at the Vatican bank. Considering the blatant record amassed by the Vatican – it’s fraudulent and illegal dealings – JPMorgan worked as one of the pope’s banksters with complete disregard for moral hazard. It was not until JPMorgan was caught naked in bed with the pope, engaging in massive and illegal transfers, did the bank begin scrutinizing the Vatican’s financial dealings to which it was an accomplice. To this point, the mainstream media has focused on the shadyness of the Vatican – an age old story, literally – and not directly implicated JPMorgan in yet further financial crimes.
The transfers did not come with information regarding account holders or purposes for the transfers. Of that amount, 20 million pounds apparently was heading to the Vatican’s JPMorgan account in Frankfurt. The other 3 million euros were heading for an account at a different bank in Rome.
Federal prosecutors in Rome froze the funds. Investigations followed implicating Tedeschi, for one, in violating anti-money laundering regulations. Then, JPMorgan leaped into action late, and “started asking Vatican officials where the money that had been regularly flowing through the Milan account was actually coming from. But they didn’t get any satisfactory answers. As a result, the bank then gave the IOR an internal classification as a high-risk client and started monitoring its transactions for clues that might point to money-laundering.”
By the end of 2010, Pope Benedict issued a decree. The Vatican bank would now abide by EU anti-money-laundering policies. The Financial Information Authority came into existence through this decree. Italian officials released the 23 million euros in frozen IOR funds.
The tempest has not cleared, however. First, there are Strasbourg-based Council of Europe money-laundering experts. The Vatican had to let them investigate their operations. A slew of other agencies out of Europe have evaluated the bank. Further, federal prosecutors in Rome are continuing their investigations. In October of last year, they requested German assistance in obtaining information related to the IOR account at the JPMorgan branch in Frankfurt. A judge in Frankfurt, in November, struck down the request due to “lack of evidence.”
Early this year, JPMorgan closed the IORs transfer account in Milan. The bank wrote that anti-money-laundering regulations no longer make available “additional deposits or withdrawals via account No. 1365.” Cardinal Secretary of State Bertone rewrote Benedict’s decree, restating that monitoring of the Vatican bank is only permissible with the consent of Bertone himself. An undated and anonymous document, which, according to the Roman daily Il Fatto Quotidiano,comes from “the very top,” reads that there is a “concrete risk of a rating downgrade and, thereby, of a significant loss in the prestige of the Holy See.”
It is clear that JPMorgan is complicit in money-laundering in Europe with the Vatican, having abetted Vatican bank money-laundering and fraud by allowing IRS-defined suspicious transactions pass through their institution. The bank, knowing fullwell what it was dealing with, shucked its financial responsibility and put the Vatican’s critical transfers through, never questioning or putting the transactions through the basic financial scrutiny. The US Press has been silent, and the banks $9 billion loss has taken over the headlines – a rehash of an old story. In the meantime, JPMorgan has partaken in the illegal and unconscionable with some of civilization’s deepest-entrenched institutions, in this case the twenty century-old religious center of Catholicism.