A study by Patricia M. McGoldrick published in "The Historical Journal" on Holy See finances during World War II
Documents from the British National Archives reveal how Pius XII fought Nazism
This is an unknown history that obliges us to chart new financial statements. A story of espionage, secret contacts, highly sensitive documents — which have remained buried for 70 years and are emerging steadily only now from the archives. At the centre of this story is Bernardino Nogara — a member of the board of directors of the Banca Commerciale Italiana and a friend of the Ratti family — who in 1929 was appointed financial advisor to the Holy See. Advised at meetings with the Curia, he was to be the leader of the Vatican's financial strategy which was fundamentally important to the Allies' victory over the Nazis and Fascists in World War II. This strategy concerned millions of dollars invested in the largest banks of the U.S. and Great Britain and used to aid persecuted Churches and exhausted peoples.
Patricia M. McGoldrick of Middlesex University, London, has reconstructed this history in the article: "New Perspectives on Pius XII and Vatican Financial Transactions during the Second World War", published in the December issue of Cambridge University's quarterly review, The Historical Journal (n. 4, 55, 2012, pp. 1029-1048). The paper is based on the discovery of British Secret Service documents which date back to 1941-1943. They are kept in the British National Archives and concern the activities of the Vatican's main financial institutions, the Special Administration of the Holy See (ASSS) and the Pontifical Administration for Works of Religion (AOR/IOR). The papers reveal — beyond the regular communication with dioceses, nunciatures and global Catholic institutions — that there were also extensive money transfers to large banks in the USA. "We learn from these accounts that at the onset of the Second World War the Vatican rapidly moved its securities and gold reserves from areas under threat of Nazi occupation to the United States, made the United States the financial hub from which it funded and administered its global Church, and had, at any one time, over $10,000,000 invested in the U.S. economy" (pp. 10431044). In other words, the Holy See used financial means to combat the Nazis and to alleviate Europe's wounds — and it did so very effectively.
Beginning with the first years of their mandate, Nogara and his collaborators wove a thick web of contacts and relationships, demonstrating remarkable diplomatic skill. "The ASSS had its account with J.P. Morgan & Co., while the AOR/IOR banked with National City Bank of New York". They also had contacts in
Great Britain where the "ASSS account was with Morgan Grenfell, the sister bank of J.P. Morgan, while the AOR/IOR banked with Barclays" (p. 1038). These accounts — McGoldrick writes — "provide clear evidence that the Vatican was systematically dispatching its securities via Lisbon, even those which had been registered in blocked countries, to the safety of special custody accounts in the United States and, once clearance had been obtained from the U.S. Treasury Department, was able to trade them freely on the U.S. markets" (p. 1039). Basically at the beginning of the conflict the Holy See decided to move to the United States an enormous amount of money (stocks, gold reserves, diocesan revenue, donations, etc.) from territories controlled by the Nazis. This took place with Washington's approval which in fact — as evidenced by British documents and also by the Treasury Archives — not only exempted the Vatican from the restrictions imposed by operations linked to enemy countries, U.S. Freezing Orders, but also allowed greater flexibility when requests came from Rome.
What sparked these money transfers? British sources provide information on two fundamental details. The first is that in the Vatican's American accounts were collected: especially the funding of dioceses, donations of the faithful and of religious institutions from all over the world, as well as — on a small scale (around 20 per cent) — the gains from stocks and investments. A good part of this money was destined to support Churches in difficulty, missions, nunciatures, seminaries and dioceses all over the world. There was a privileged channel for Europe: "To provide relief for its harassed Churches in Nazi-occupied Europe, where Catholic schools, monasteries, and Churches had been confiscated or closed, Catholic youth organizations and publications suppressed, and numerous priests and religious arrested and interned in concentration camps, the AOI/IOR maintained a separate account with Chase National Bank of New York" (p. 1042). When the British government tried to close one of the accounts "the Vatican appealed directly to the U.S. government... and did so with apparent success" (p. 1042). The documents of the National Archives also reveal the financing of humanitarian aid of Allied troops and of the people devastated by the war. An example of this is in April 1944: Pius XII sent shipments of flour to the city of Rome where, before that, he had provided hot meals on a daily basis. He also attempted to import foodstuffs from Spain and Argentina for Italy and Greece.
But this was not all. Beginning in 1939, as is clear from Nogara's contacts in Washington, the Vatican made significant investments in U.S. Treasury Bills, in large manufacturing companies and utilities such as Rolls Royce, the United Steel Corporation, Dow Chemical, Westinghouse Electric, Union Carbide and General Electric. McGoldrick goes as far as to say that "a torrent of Vatican money" was used in the U.S. wartime industry which "defeated the Nazi regime and ended the bestial murders of the Holocaust forever" (p. 1045).
It is too soon to trace the specialized and rigorous budget from the documents which Patricia M. McGoldrick studied. The financial history of World War II is uncharted which few have begun to explore. There is still more material to be discovered and studied. However what we have before our eyes is enough to make us desert hurried judgements and ideological visions in the reconstruction of events.