August 03, 1997

Vatican bank dealt with Reichsbank in war-document

By Arthur Spiegelman

LOS ANGELES, Aug 3 (Reuter) - New documents have been found in the U.S. National Archives implicating the Vatican's bank in possibly illegal transactions with Nazi Germany and its Axis partners during the Second World War.

U.S. Intelligence documents obtained by Reuters on Sunday said the Vatican bank, known as the Institute for Religious Works, used Swiss banking middlemen in at least three cases to obtain money from the German Reichsbank or to transfer funds to a bank that was blacklisted by the Allies for its dealings with Nazi Germany.

The documents come almost two weeks after a storm erupted over a postwar U.S. intelligence report that claimed the Vatican stored $130 million worth of gold coins and cash taken by the Croatian Nazi puppet state from Serbs and Jews.

Although the Vatican hotly denied doing any such thing, President Bill Clinton called on the Treasury Department to review its documents and determine the extent to which the Vatican may have held money taken from Nazi victims during the war.

U.S. Ambassador to the Vatican Raymond Flynn, in a letter to President Clinton, said the allegations were weak and added, ``Of the 15 million pages of documents in the National Archives related to Nazi gold, so far only one mentions the Vatican.''

But since Flynn's comment, documents have been found listing Allied intercepts of Swiss bank wire transfers in 1944 and 1945 that cite ``objectionable'' Vatican bank dealings.

One confidential document, dated Jan. 27 1945, lists a Nov. 12 1944 transaction in which the Swiss bank, Credit Suisse, sent the following message to the Vatican bank: ``We credit you 6,407.50 francs on order of the Reichsbank Berlin.''

The Reichsbank was Nazi Germany's central bank and the transaction was listed among violations by the Swiss of the Allied war code which forbade illegal trading with the enemy.

A second document labeled ``Secret Intelligence Material Confidential,'' said that in April 1945, the Vatican Bank instructed the Union Bank of Switzerland to pay 100,000 Swiss francs and asked the Swiss central bank to pay 200,000 francs to the Bank Swiss Italienne of Lugano, which the Allies had placed on its blacklist in June 1940.

A third document, also in 1945, said the Vatican bank asked a Portuguese bank to ``forward 2,500 large dollar notes in a sealed packet to the Vatican through the medium of the papal nuncio in Lisbon.''

Private researchers at the National Archives said the documents were important because they were lists of intercepted wire transfers, which they described as ``hard evidence,'' unlike the claim that the Vatican stored looted funds for Croatian fascists. That was based on information from an informant.

The Vatican has declined to open its Second World War archives to historians.

Researchers have been combing the U.S. National Archives for two years to uncover the extent of Swiss business dealings with the Nazis during the war and to find out what happened to the billions of dollars in gold, cash and other valuables looted by the Nazis from the treasuries of the nations they conquered and from Jews and other minorities.