Dio Mio! 'Corruption-Fighting' Italian PM Linked To Rogue Vatican Fund
Italy is hardly a stranger to financial horrorshows. Whether it's fiscal mismanagement, blundering centuries-old banks loaded down with bad loans, a federal government too deep in the red, fears of a populist-backed parallel currency or the shadowy tendrils of the mafia tainting the country's agri-export business.
And now, what appears to be serious financial corruption scandal has found a direct line to the Quirinal Palace.
So, what exactly is going on? Well, yesterday, the FT reported that a Vatican-backed investment fund that is under investigation by the Vatican authorities had hired Italian PM Giuseppe Conte to negotiate a deal.
Just weeks before Conte took office (for the first time), Conte, then a little-known Florence-based academic, was hired in May 2018 to provide a legal opinion in favour of Fiber 4.0, a shareholder group involved in a fight for control of Retelit, an Italian telecoms company.
The biggest investor in Fiber 4.0 was the Athena Global Opportunities Fund, which was constituted entirely by $200 million from the Vatican Secretariat. The Fund was owned and operated by Raffaele Mincione, an Italian financier.
The news of Conte’s involvement will likely attract more scrutiny of the Fiber 4 deal from the Vatican police. In fact, Conte’s involvement wasn’t widely known until the police raided the all-powerful Vatican’s Secretariat of State, the Church’s most powerful centralized bureaucracy and the source of all the financing for the Fiber 4.0 deal.
Conte
The Secretariat is currently under investigation over its involvement in several suspicious transactions, allegedly including this property deal, which inspired the initial raid mentioned above, according to the FT on Mondy.
In the property deal the Secretariat invested in a $143 million building deal in London’s Chelsea with money it held away from central Papal State funds in several Swiss bank accounts. The deal has raised concerns from Vatican investigators that the Secretariat may have been misusing hundreds of millions of dollars under its control, which have been donated to the poor by Catholics around the world.
Now, investigators that Conte, either unwillingly or willingly, helped paper over something similar.
In Conte’s deal, the fund was part of a consortium (Fiber 4.0) hoping to win control of a small Italian telecoms company called Retelit. Fiber 4.0 hired Conte in May 2018 as a “freelance legal expert” after the consortium lost a vote in April over a proposal to take over Retelit. It lost the vote to a rival company controlled by German and Libyan interests, which Conte apparently believed gave the, an opening.
Conte argued in the memo that the Italian government could step in and annul the vote using rules intended to protest “strategically important assets” (not dissimilar to the CFIUS deal review board in the board).
Once he finally took office, in June 2018, he did just that. However, a few months later, his maneuverings were reversed and he was fined for his conduct.
Conte is now trying his hardest to distance himself from that deal.
“Regarding the new facts reported by the Financial Times, it should be noted that Mr Conte only gave a legal opinion and was not aware of, and was not required to know, the fact that some investors were connected to an investment fund supported by the Vatican and now at the centre of an investigation,” Conte’s office told the FT.
This would be a most delicious irony: For Conte, whose reputation as an honest politician helped save his career when the Five Star-League coalition collapsed, to instead be felled by suspicions surrounding a possibly corrupt act mostly committed while he was still a civilian.
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