Vatican official arrested on suspicion of corruption, Rome prosecutor says

By Hada Messia and Laura Smith-Spark

CNN

ROME (CNN) — A bishop who works in the Vatican and two other people have been arrested on suspicion of corruption in a case connected to the Vatican bank, Rome Prosecutor Nello Rossi said Friday.

Nunzio Scarano, the Archbishop of Salerno in southern Italy, works as a financial analyst in the Vatican office that administers Vatican-owned property.

The arrests come in the same week that Pope Francis established a papal commission tasked with investigating the activities of the Vatican bank, also known as the Institute for the Works of Religion.

The commission, made up of five members, four clerics and a Harvard law professor, will report back to the pope with its findings “in view of possible reform,” Vatican spokesman Father Federico Lombardi said, according to Vatican Radio.

The Vatican has been plagued by internal power struggles over its murky finances for decades.

On Wednesday, a financial watchdog agency established in 2010 issued its first report on money laundering, in a move to improve financial transparency in the city-state.

The document from the Financial Intelligence Authority shows six reports of “suspicious activity” in the past year, up from just one in 2011. It says the Vatican’s prosecutors are investigating two of those reports for possible criminal activity, though it wouldn’t elaborate further.

The Vatican bank is also working to improve transparency, announcing earlier this month that it will launch a website to publish an annual report of its activities.

The bank serves thousands of Catholic charities, religious orders and dioceses around the world, in addition to roughly 500 people living in the tiny city-state. It has some 33,400 accounts and about $8 billion in assets.

CNN’s Hada Messia reported from Rome and Laura Smith-Spark wrote from London. CNN’s Alanna Petroff contributed to this report.