January 24, 2011

Pope Benedict has instituted a new agency to monitor all Vatican financial operations and make sure they meet international norms against money-laundering and the financing of terrorism.

The pope established the Financial Information Authority as an independent agency to oversee the monetary and commercial activities of all Vatican-related institutions, including the Vatican bank.

At the same time, the Vatican promulgated a detailed new law that defined financial crimes and established penalties, including possible jail time, for their violation.

The Vatican spokesman, Jesuit Father Federico Lombardi, described the move as a courageous step that reflects the moral requirement of "transparency, honesty and responsibility" in the Vatican's operations.