Vatican Bank Chairman Ernst von Freyberg to Step Down Amid Shakeup Rumours

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By Esther Tanquintic-Misa | July 2, 2014 2:07 PM EST

Rumours of an impending shakeup has forced Ernst von Freyberg, chairman of embattled Vatican Bank, to step down ahead of confirmations, Italian media reported earlier.

L'Espresso, an Italian newsweekly, last week reported Von Freyberg would soon resign, allegedly due to a clash with the personal liaison to the bank of Pope Francis over access to information.

REUTERS/Tony Gentile/Files
President of the Vatican bank Ernst von Freyberg gestures during an interview with Reuters in his office at the Vatican in this June 10, 2013 file photo. Picture taken June 10, 2013. The Vatican bank's chairman is to step down as soon as next week as part of the restructuring of an institution that has been an embarrassment to the Catholic Church for decades, Vatican sources said on Tuesday. But the sources, who spoke on the condition of anonymity, disagreed over whether von Freyberg was leaving willingly or whether he was being pushed out over differences within the Vatican about the pace of reform. REUTERS/Tony Gentile/Files (VATICAN - Tags: POLITICS BUSINESS PROFILE RELIGION)

Reuters, however, according to an unidentified source, reported Von Freyberg's resignation, was a scenario not unexpected at all.

Von Freyberg, a German lawyer and manager, rose to the post as chief executive of the Vatican Bank in February 2013, in what was seen as one of Pope Benedict XVI's last major decision. Ever since, his tenure has been accorded as a "stop-gap following the spate of scandals at the bank in the closing years of Benedict's papacy."

A report by Boston Globe said French financier Jean-Baptise de Franssu is being eyed to replace Von Freyberg. He currently sits on the Council for the Economy.

"Freyberg was called in to clean up the mess and now something different, more stable, is needed," the source said.

The Institute of Religious Works, as what the Vatican bank is formally known, in the more than one year under Von Freyberg's administration, closed at least 1,400 accounts, instituted strict anti-money laundering regulations and launched several investigations into suspicious activities.

But "this is the end of phase one. Phase two will see the integration of the IOR in the new financial architecture of the Vatican, but this will require more time," the Financial Times quoted an unidentified person close to the process who did not want to be named.

Pope Francis and his eight cardinal advisers are scheduled to meet anytime soon to decide the bank's future, Italian news reports said, citing two people familiar with the decisions.

"Obviously IOR is in a time of peaceful transition. The contribution of Ernst von Freyberg continues to be deeply appreciated and highly valued and further clarifications are possible, indeed likely, next week after the meeting of the Council for the Economy on Saturday," the Vatican said.

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(Photo: REUTERS/Tony Gentile/Files / )
President of the Vatican bank Ernst von Freyberg gestures during an interview with Reuters in his office at the Vatican in this June 10, 2013 file photo. Picture taken June 10, 2013. The Vatican bank's chairman is to step down as soon as next week as part of the restructuring of an institution that has been an embarrassment to the Catholic Church for decades, Vatican sources said on Tuesday. But the sources, who spoke on the condition of anonymity, disagreed over whether von Freyberg was leaving willingly or whether he was being pushed out over differences within the Vatican about the pace of reform. REUTERS/Tony Gentile/Files (VATICAN - Tags: POLITICS BUSINESS PROFILE RELIGION)
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