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An arrested priest who formerly served as an accountant in the Vatican now faces charges he falsely solicited donations, laundered them through the 'Vatican bank', and put them to his personal use. His former department manages the Holy See's investments. On Jan. The latest charges are related to allegations he conveyed "false donations" through the Institute for the Works of Religion, commonly called the Vatican bank, from offshore accounts.

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Italian authorities said Msgr. Scarano falsely solicited dozens of people for donations to a home for the terminally ill in Salerno, then used the money to pay off a mortgage. Two others were served with arrest warrants. Another priest was arrested on charges of money laundering and making false statements. The allegations arose last year, leading Vatican authorities to suspend Msgr.

Scarano from his job in early June , and to freeze his funds on July 9. A Vatican investigation of the monsignor resulted in an page dossier about his activities. Scarano was arrested on June 28, on other allegations of corruption. He had the cooperation of an Italian secret service agent and a financial broker. The priest is currently under house arrest.

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He and his alleged conspirators in the money smuggling have been on trial in Rome since December. The Vatican bank has been undergoing reforms to encourage transparency and compliance with international financial standards to combat money laundering. Vatican financial reform was begun in , when the Holy See signed a monetary agreement with the European Union, and issued an anti-money laundering law the following year.