As the Vatican continues working to comply with international standards against money laundering and financing terrorism, it still needs to beef up internal inspection and supervisory powers, said a long-awaited report by European finance experts, reports the Catholic News Service.

Overall, the Vatican met nine out of 16 "key and core" recommendations, thereby passing its first major test in an effort to become more financially transparent and compliant with international norms.

"The Holy See has come a long way in a very short period of time and many of the building blocks" of a system to combat money laundering and the financing of terrorism "are now formally in place," said the first report on the Vatican by "Moneyval" - the Council of Europe's Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism.

However, "further important issues still need addressing" to tighten remaining loopholes, fill in legal gaps and guarantee laws are effectively being carried out, it said.

The 240-page report was released to the public yesterday.

Moneyval said the Vatican needs to expand the legal powers and guarantee the independence of its Financial Information Authority, the Vatican oversight agency charged with monitoring all Vatican agencies that have financial dealings or commercial transactions.

FULL STORY Vatican passes first test against money-laundering (CNS)