THE VATICAN’S bank could this week be blacklisted by the international finance community after investigators found poor anti-money laundering controls in place.

The 71-year old lender is being probed by Moneyval, the Council of Europe’s watchdog which monitors standards in finance.

If the watchdog rules against the Institute for the Works of Religion, as the Vatican Bank is formally known, it will face difficulties transferring money around the world.

Such a blacklisting could prove problematic for the church which relies on the organisation to fund operations around the globe.

Previous reports from the Council of Europe have found the Vatican making strides in its anti-money laundering processes, particularly as Pope Benedict XVI extended several finance rules to cover himself.

However, despite the progress introducing new rules Moneyval has expressed concerns that the regulations may not be well implemented, leading to continued doubts over the strength of the regime.