Drew Hinshaw
Appearances
Apple News Today
People are noticing “recession signs” everywhere. What does the data say?
He hires auditors, essentially. One of them had been an executive at the accountant firm Deloitte, and these auditors are sort of shocked what they find.
Apple News Today
People are noticing “recession signs” everywhere. What does the data say?
There's nuns who are doing calculations and keeping budget ledgers with pencil and paper. There are clergy who are moving money from their Vatican accounts to bank accounts under a cardinal's name to hide money from the auditors.
Apple News Today
People are noticing “recession signs” everywhere. What does the data say?
You have clergy who, in their minds, they're doing God's work on earth. And why an outside auditor or an accountant should tell them how to do those things? You're going to hit resistance.
The Journal.
The Financial Mess Facing the Vatican
But at the end of the day, the decisions are taken by clergy who, quite honestly, could talk to you more about gospel or Acts or the New Testament or the Old Testament than the nuts and bolts of an audit. It's where two realms kind of meet, isn't it?
The Journal.
The Financial Mess Facing the Vatican
Yeah. On the one hand, cardinals are electing someone who is very pointedly in charge of the biggest issues in life. You know, theology and spirituality and life after life and, you know, doing good in the world and all of the things that are core to the Christian gospel. But they've got this kind of dollars and cents problem that they also have to solve.
The Journal.
The Financial Mess Facing the Vatican
And the idea that one person is gonna be good at both of those issues, it's, I don't know, seems like a lot to ask of one human being.
The Journal.
The Financial Mess Facing the Vatican
The Vatican, it's both like, you think of it as the heart of the Catholic Church, but maybe it's better to think of it as like the brain.
The Journal.
The Financial Mess Facing the Vatican
You know, it's 900 residents. It's the home of the Pope, you know. And it's where the direction of the church is set, of course, but it's not where the money's made.
The Journal.
The Financial Mess Facing the Vatican
You know, the money on Sunday, when, you know, when the collection plate goes around, that's not really going to Rome. That's going to, you know, your local and national church. It's this odd thing where it's totally paradoxical. This extremely wealthy city-state that's at the center of this, you know, the largest Christian denomination, but it's not where the money is in the Catholic Church.
The Journal.
The Financial Mess Facing the Vatican
And advisors and Vatican officials are coming in and presenting the details of a city-state, effectively, that is awash in priceless treasures but is falling deeper into debt.
The Journal.
The Financial Mess Facing the Vatican
It's got to fund a network of embassies all around the world. It's got to fund a small army, the Papal Swiss Guard. It's got to do upkeep on these marvelous buildings that you can stand and take selfies in front of. And it's increasingly dependent on museum ticket sales to do that. This has got to be the only state on earth that depends on ticket sales.
The Journal.
The Financial Mess Facing the Vatican
The pension fund is, one source told us, he used the words, five alarm fire.
The Journal.
The Financial Mess Facing the Vatican
It's around 80 million euros, give or take, which is triple what it was about 10 years ago. Wow. It's looking really dire.
The Journal.
The Financial Mess Facing the Vatican
Maybe in the year zero. Look, this history really goes back centuries and centuries, of course. The irony is, look, when you go to the Vatican and you see all these beautiful buildings, you're seeing buildings from an era when paying the bills wasn't very difficult for the pope. You know, the Crusades, Sistine Chapel, St.
The Journal.
The Financial Mess Facing the Vatican
Peter's Basilica, these were all financed, but they were financed through a 6th century invention called indulgences. Although that practice was considered so corrupt, it helped spark the Reformation.
The Journal.
The Financial Mess Facing the Vatican
Along the way, the Vatican kind of develops this reputation in the 70s and 80s for being like just basically a really shady place to have a bank account. If you've ever seen Godfather 3, you know, this is basically that era. Oh, if only prayer could pay off our $700 million deficit. $769 million.
The Journal.
The Financial Mess Facing the Vatican
There was a kind of mafia-linked financier who, before his downfall, he'd been close to Pope Paul VI, and he had ties to New York's Gambino crime family.
The Journal.
The Financial Mess Facing the Vatican
There was also a huge scandal in the 1980s when the Vatican Bank got caught up in the collapse of an Italian bank, Banco Ambrosiano, and the bank chairman was found hanging under Blackfire's Bridge in London. The man known as God's Banker was found hanging from a bridge, his pockets full of cash and bricks.
The Journal.
The Financial Mess Facing the Vatican
And every source we've talked to has said that this was a factor in Benedict deciding he would become the first pope to resign since 1415.
The Journal.
The Financial Mess Facing the Vatican
Right, right. By all accounts, the headache of trying to clean this up just became a lot for him.
The Journal.
The Financial Mess Facing the Vatican
He hires, you know, an executive from the accountant firm Deloitte and basically says, brings him into his office and he says, I want you to be independent. You have my, like, go ahead.
The Journal.
The Financial Mess Facing the Vatican
Yeah, you have my blessing. I wasn't going to use the word, but you have my blessing to probe our accounts, like, you know, to conduct audits. This was the first time the Vatican had an outside auditor in its modern history.
The Journal.
The Financial Mess Facing the Vatican
Not well, I think is one way you could say it. And look, their reasoning is this money is vital. We need it to host a commission of theologians. We need it to buy office supplies, coffee. We need this to run our outfit.
The Journal.
The Financial Mess Facing the Vatican
And if we have to go through the ropes of getting it from the Vatican treasury, which is this whole other thing that the auditor is looking into, it's going to be really hard and time-consuming.
The Journal.
The Financial Mess Facing the Vatican
The cardinal's advisor was telling him, we must save our money. And they took money out of the Vatican bank and started storing the cash in a bag. Literally a bag.
The Journal.
The Financial Mess Facing the Vatican
It gets really crazy. I mean, the auditor comes back to his office at one point, and the office has been broken into. It's Monday morning, and the bottom of his laptop is unscrewed. There's a spring missing. Wow. And he's spooked. He goes and asks Francis, like, what am I supposed to do? And Pope Francis doesn't really push for an investigation.
The Journal.
The Financial Mess Facing the Vatican
He just says, let's put security cameras outside the office.
The Journal.
The Financial Mess Facing the Vatican
And that's basically where that auditing effort hits a wall.
The Journal.
The Financial Mess Facing the Vatican
And on April 21st, he died, leaving his successor with this economic puzzle that one pope after the next has tried to solve.
The Journal.
The Financial Mess Facing the Vatican
I've reported on authoritarian countries, and I've rarely encountered the kind of just evident nervousness in talking to the press that you encounter here in the center of Rome when you're trying to answer questions about the budget deficit of the Vatican.
The Journal.
The Financial Mess Facing the Vatican
We had one guy sit down with me near midnight in a piazza. And one of his first questions for me was, you're not recording me, are you? Because if you're recording me, this interview is over. And of course we weren't, you know, but it's all fairly cloak and dagger here.
The Journal.
The Financial Mess Facing the Vatican
There's kind of two camps. There's one that can see it in the kind of dollars and cents terms that we're discussing it. But there's others who say, look, we're here to talk about matters of God, of spirituality. Why are we talking about these earthly concerns that are secondary to our mission of saving souls? And the church has been around for 2,000 years. There's a feeling of this is...
The Journal.
The Financial Mess Facing the Vatican
Look, if you were running a country, just a kind of a totally secular, small municipality of 900 people, and you had these kind of budget deficits, you'd be freaking out. But when underneath that municipality is 2,000 years of history, I think you think, well, you know, we've survived before.
The Journal.
The Financial Mess Facing the Vatican
The way this was put to me is that they can't just keep kicking the can down the road. They're going to have to do things that are undoubtedly going to be painful for clergy who are expecting to be able to retire and who have obviously fixed salaries and who have one profession. Everybody we've talked to sees only painful choices ahead.
The Journal.
The Financial Mess Facing the Vatican
The Vatican has no intention of ever selling off its inheritance. In fact, it lists many of its priceless works of art, including the Sistine Chapel, on its books at a nominal value of one euro each, which is a way of saying these things are of religious and artistic and historical significance, not of financial significance. It would never, ever part with it. This is its patrimony.
The Journal.
The Financial Mess Facing the Vatican
I mean, this is one of the hidden stories of really the modern papacy, is how much the Bishop of Rome is the ultimate bookkeeper for the Vatican.
The Journal.
The Financial Mess Facing the Vatican
There's like this incredible paradox at the center of this. You have a country that has immense wealth, but it's unable to sustain its basic functions without running a deficit. It's got all these people who work in finance who are basically in the Vatican running its bank and everything else.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Nobody's perfect. It's in real life, you know, spies are human beings. And that's what happened here.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
He wears kind of silver neck chains and Armani scarves. And the joke is that he kind of dresses like the organized crime bosses that he normally investigates.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
This girl, until really a few minutes before, thought her parents were Argentinian citizens. The truth is, they were Russian spies who'd spent a decade, more, assembling an entirely fictitious life.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
The Slovenian wondered, what secret could be so sensitive that his British counterpart had to deliver it in person? Kadyvnik flew to London.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
The head of MI6 is referred to as C. It's kind of his code name. It dates back to the foundations of the spy agency. And C tells his Slovenian counterpart, you've got some Russian spies in your country. And he passes along a tip, but this tip is incredibly vague.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Of all the foreigners in any given country, two of them are actually Russian spies, and you've got to find them.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They did take a trip to Russia in 2018 to see Argentina play the World Cup.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They didn't know anything about their parents, really.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
That was a trip for the mom to let the family meet their kids, you know, the grandparents, without the kids ever kind of picking up on what was really going on.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Maybe they didn't want to leave any record on their Argentine passports that they'd been to Russia. Yeah. Because that would have been kind of alerting behavior like, oh, interesting.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
the newlyweds in that picture match the faces of two Argentinian parents living in the suburbs of the capital of Slovenia. So then the question becomes, if these two are Argentinians living in the suburbs, why is their picture, their wedding day picture, on a wall in central Russia? Huh.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Nothing. Nothing. They were like ghosts. In the back of your mind, you're kind of like, who is this couple? What's going on with this?
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
And you have to imagine how nerve-wracking this is. These two are expert spies.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
You have guys bursting through windows. Officers are thundering through the house.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Why are you doing America's bidding? Don't get involved in this. You don't want to get involved in this. And his message is really point blank. Let's make a trade. You need to give our people back. Give us our spies back.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
The Russians were meeting with the Americans saying, you know, basically saying, hey, we'd like to trade. Let's do a trade for these two. They could potentially be involved in a trade. And Evan's name was obviously in the mix for that.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
There's no red carpet, and out of the plane comes two journalists and a former Marine and a rock war veteran. And that's it. And the contrast, it's really striking. You can see Russia celebrating its spies and its assassins, and America's just sort of quietly receiving its two journalists and a veteran.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
There will be more August 1sts. They may not be as big, may not be as many countries, but this is by now just an established pattern of the way the world works. Every six months, a couple times a year, one country releases an ordinary American charged with trumped-up or spurious charges and exchanges them for somebody else, a money launderer, a sanctions buster, a spy.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They are state media's idea of a patriotic Russian family.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
When she shows up, she's fully dilated. She's ready to give birth within the hour. And the doctor notices there's something a little bit weird.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
I think 10,000 babies. And this one stuck out of his mind just because he thought there was something really unusual and I couldn't put my finger on it at the time.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
He notices at one point that she seems really lonely. There's something about this woman that just doesn't seem spiritually well, the doctor says in his words.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
The doctor notices this couple, they're not FaceTiming or calling anybody. Like, normally when someone gives birth, you've got visitors, well-wishers, gifts even. Who knows? Especially in Argentina, you'd have lines of relatives of all types coming to say hi. And no one's coming to say hi to this family. Yeah.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Yeah. The first lady off the plane is a mom.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
And said, I speak German. Send me out there. Send me out there.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They picked up the birth certificates of children who died in their first months of life and used those birth certificates of dead babies and toddlers to pick up passports from Greece or Mexico or anywhere in the world. And they started to live lives as those individuals.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They were really married in Russia in the 2000s, but they got married again in Argentina to create the paper trail.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
They get a new order from what's called the center, which is basically Moscow. It's time to go to Slovenia.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
It's in the middle of Europe's passport-free zone, so you can get in a car and drive all the way through Germany, France, Spain, Italy, wherever you want to go, and nobody's going to stop you and look at your passport.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Yeah, we talked to their neighbors, all kinds of their people from their school community. And I mean, Joe and I have been journalists for, I don't know, maybe 15 years or more at this point. And we're pretty used to showing up and doing what we call vox pops with the neighbors. Stuff happens. You go, hey, do you know this guy?
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
And in my career, I've rarely met someone who just nobody remembered anything interesting about at all. Nothing. Nothing.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
Maria ran an art gallery. His story, he ran an IT firm.
The Journal.
Inside the Hunt for Putin’s Sleeper Agents
The US obviously has incredible ability to eavesdrop on our phones and emails and everything else. But leaving a rock in the woods of Slovenia, how are we going to find that?