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Vatican cleric arrested in corruption case

Nunzio Scarano and others accused of trying to smuggle $26m in cash into the country from Switzerland by private jet.

Last Modified: 28 Jun 2013 16:22
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Scarano was under investigation in a purported money-laundering plot involving the Vatican bank [AP]

A senior Vatican cleric and two other suspects with connections to the Vatican bank have been arrested in a money smuggling case in Italy.

Monsignor Nunzio Scarano, 61, and others were accused of trying to smuggle 20 million euros ($26m) in cash into the country from Switzerland by private jet.

Italian prosecutor Nello Rossi told reporters that Italian financier Giovanni Carenzio, and Giovanni Zito, who at the time of the plot was a member of the military police's agency for security and information, were arrested along with Scarano on Friday.

Scarano, who was being held at a prison in capital Rome, was already under investigation in a purported money-laundering plot involving the Vatican bank.

Vatican Bank inquiry

The arrests came just two days after Pope Francis created a commission of inquiry into the Vatican bank to get to the bottom of the problems that have plagued it for decades and contributed to the impression that it is an unregulated, offshore tax haven.

The high-powered, five-member panel, which includes four prelates and a woman Harvard law professor, will report directly to the pope, bypassing the Vatican bureaucracy which has sometimes been tainted by allegations of scandal and corruption.

The bank, formally known as The Institute for Works of Religion (IOR), has a troubled history, which includes the collapse of the Banco Ambrosiano, in which the Holy See was the main shareholder, and had been accused of laundering money for the Sicilian mafia.

The IOR, which does not lend money, manages assets of 7.0 billion euros ($9.3bn) and handles funds for Vatican departments, Catholic charities and congregations and priests and nuns living and working around the world.

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