AUSTRAC reported that Australia had wired $2.3 billion to the Vatican. The actual number was 9.5 million dollars
After mistakenly informed Parliament that the Vatican transferred $2.3 billion to Australia over seven years when the real sum was less than $10 million, the financial crime watchdog has released a grovelling apology.
In the Holy See, where Cardinal George Pell was caught up in an ugly internal battle over his financial affairs, the Australian Transaction Reports and Research Centre's argument caused alarm and uncertainty.
But AUSTRAC has now acknowledged that the number was 242 times higher than the true $9.5 million total and blamed the bungle on software.
Chief executive Nicole Rose said in a letter to a Senate committee that "quality assurance processes should have identified" the error and vowed a review to ensure that the error did not happen again.
The organization is believed to have mistakenly allocated hundreds of millions of dollars to the Vatican in transfers between Italy and Australia, contributing to a dramatically inflated number. What the transferred funds were for is unknown.
Following a query from Liberal Senator Concetta Fierravanti-Wells, AUSTRAC presented the $2.3 billion figure to Parliament in December. The senator was investigating Italian newspapers' reports of illegal transactions between the Vatican and Australia and whether any funds had been used to impact Pell's 2018 trial and conviction on charges of child sex abuse.
Last year, the High Court reversed Pell's conviction unanimously.
In its original response to Fierravanti-Wells, AUSTRAC estimated that between 2014 and 2020, $2.3 billion was sent to Australia over approximately 48,000 separate transactions.
It said that in 2014 $71.6 million was sent, in 2015 $137.1 million and in 2016 $295 million. In 2017, 2018 and 2019, the transfer value soared to a yearly total of $500 million.
In its revised figures, AUSTRAC said that in 2017, the most transferred by the Vatican to Australia in a single year was actually $2.6 million. AUSTRAC originally said that transfers amounted to $492 million in 2019 as an indication of the scale of its mistake, when the actual figure was just $800,000.
When Vatican figures and the Australian Catholic Bishops Conference expressed disbelief about the extraordinary number, the Australian newspaper first raised questions about the veracity of the $2.3 billion claim.
"Reuters was also told by an anonymous Vatican figure that the billion figure was "like science fiction".
"It's not our money because we don't have that kind of money," he said. "I am absolutely stunned."
Rose said AUSTRAC had tried to correct the statistics with the Vatican's Financial Intelligence Unit.
"AUSTRAC has subsequently undertaken a detailed review of the data and put immediate additional quality assurance processes in place," she said. "AUSTRAC is also considering what further processes and governance changes should be implemented into the future."
The organization even miscalculated how much cash had been sent to the Vatican from Australia. It initially told the Senate that over seven years, the amount was $117.4 million, when it was only $26.6 million.
"Fierravanti-Wells told The Sydney Morning Herald and The Age, "AUSTRAC's 'discrepancy' concerning the documentation of the transfer of Vatican funds reflects poorly on the international credibility of AUSTRAC.
That said, the revised figures, where did the funds go and for what reason, add more clarification to the key issue? Significant allegations surrounding the suspected use of funds in the case of Pell remain. They need to step up their pursuit of the evidence by the appropriate law enforcement authorities.
Pell returned to the Vatican in September just as, following the Pope's decision to sack Cardinal Angelo Becciu over reports of dubious property transactions, his financial affairs came under renewed scrutiny. Becciu has denied any misconduct.
During the Australian cardinal's tenure as Vatican treasurer between 2014 and 2017, Becciu and Pell clashed.
Last October, the Italian newspapers La Repubblica and Corriere della Sera reported that Becciu was accused of arranging to move €700,000 ($1.1 million) to people in Australia to fund the prosecution of Pell in Victoria.
AUSTRAC reviewed the reports and provided the Australian Federal Police and Victoria Police with "information" in October.
However, there is no proof that any money affected Pell's trial, and in the absence of any other evidence or information, Victoria Police said there was no need to investigate.
Any of the transactions are now being looked at by the AFP.