A Vatican judge has ordered 10 people, including an Italian cardinal, to stand trial for alleged financial crimes.
Cardinal Angelo Becciu has become the highest-ranked cleric in the Vatican to be indicted over charges that include embezzlement and abuse of office.
The 73-year-old cardinal, who denies wrongdoing, was forced to resign last September, but retains his title.
The charges relate to a multi-million-dollar property purchase with Church funds in London.
Cardinal Becciu was a close aide to Pope Francis and previously had a key job in the Vatican’s Secretariat of State, which manages the Church’s donations.
He will face questions over a controversial loss-making deal to invest in the luxury London building while he was in charge at the secretariat; the deal has since been the subject of a financial investigation.
The $200m (£155m) paid for the apartment block in Sloane Avenue came out of Church money through offshore funds and companies – a deal the cardinal had defended in the past.
In a statement released on Saturday by those close to him, the cardinal said he was “the victim of a conspiracy” and protested his “absolute innocence”, the AFP news agency reports.
Further scrutiny for the Holy See?
Analysis by John McManus, BBC News
Getting to the heart of the troubling relationship between the Vatican and its finances has become one of the main themes at the Vatican under Pope Francis.
Parallel to his desire to make the Church a sanctuary where everybody, however imperfect, can find a place, has been his work to make the Vatican a distinctly unwelcoming destination for those who would use it to enrich themselves.
The alleged crimes listed today still have to be proven in court.
But the very fact the Pope was ready to sanction the indictment and trial of a cardinal who was not only a senior member of the Vatican hierarchy, but also by his own account a friend of Francis, signals again his clear intention that when it comes to financial wrongdoing he’s prepared to take unprecedented action to clean up the Church’s reputation.
The risk for the Pope, and the Church, is that this trial will open up the possible mismanagement of the Holy See’s finances to further public scrutiny.
Two former heads of the Vatican’s financial intelligence unit are among the 10 defendants.
They face charges including embezzlement, money-laundering, fraud, extortion and abuse of office.
The first hearing is set to be held on 27 July, according to the statement on Vatican News.