UPDATE: Vatican Officials Resign

Vatican bank director Paolo Cipriani and his deputy Massimo Tulli resigned Monday, three days after the arrest of Monsignor Nunzio Scarano, BBC reports

The two officials stepped down due to recent developments in the financial scandal involving Scarano, according to Al Jazeera. Scarano is accused of plotting with two other people to smuggle $26 million from Switzerland to Italy, as well as money laundering and fraud in another case. 

Ernst von Freyberg, the Vatican bank’s president, will become interim director general of the bank. The bank also established a new position of chief risk officer, who is in charge of improving compliance with financial regulations.

Last week, Pope Francis created a new commission of inquiry into the Vatican bank because of the number of scandals that have rocked the bank in the past few decades. BBC reports that the Pope has already named a new cleric to oversee how the bank was managed.

The case against Scarano has caused the Pope much embarrassment. The Pope, who campaigned for the Catholic Church to be closer to people in the developing world, has stressed the importance of a simple life of devotion.

The bank is trying to clean up its image after a history of scandals, reports Reuters. Moneyval, the European anti-money laundering committee, said that the bank still needs more reforms in order to meet international standards against money laundering. The bank is due to give a progress report on Moneyval this year.

Some clergymen are debating the need for a Vatican bank, which manages $9.3 billion in assets and directs funds for Vatican departments, Catholic charities and congregations, and for priests and nuns living around the world, according to Al Jazeera.