Pope says investigation of London building buy shows controls working

Pope Francis speaks during a news conference onboard the papal plane on his flight back from a trip to Thailand and Japan

By Philip Pullella

ABOARD THE PAPAL PLANE (Reuters) - Pope Francis acknowledged on Tuesday that there had been suspected corruption in the Vatican related to the purchase of a building in London but its discovery showed that new internal financial controls were working.

Speaking to reporters aboard the plane returning from a trip to Thailand and Japan, he sought to assure faithful who contribute to the Church that the Vatican was doing everything possible to guarantee that their money would be used properly.

"It's the first time that in the Vatican the lid was taken off the pot from inside, not from the outside," Francis said in response to a question.

He was referring to the fact that in the past, most Vatican financial scandals were unearthed by outsiders.

"Many times before it was uncovered from the outside when others told us 'look' and there was so much shame," he said, bringing his hand to his forehead like someone with a headache.

The pope's comments were his first in public since Vatican police raided its regulator, the Financial Information Authority (AIF), and the Secretariat of State, while investigating an investment the Secretariat had made in London real estate.

Five Vatican employees were suspended after the Oct. 1 raids, including AIF director Tommaso di Ruzza.

Domenico Giani, Vatican security chief and the pope's bodyguard, resigned later over the leak of a document related to the investigation, and AIF president Rene Bruelhart's five-year term was not renewed when it expired last week. [L8N27Y2SK]

The pope said the Vatican's acting auditor general told him earlier this year that he suspected impropriety in the deal. Francis said he told auditor to file a complaint with the Vatican's chief magistrate.

"And I was happy about this because it shows that the Vatican administration now has the resources to clear up the ugly things that happen inside," Francis said.

"Even if there is the presumption of innocence, the money was not administered well, and there was (suspected) corruption," he said.

He said interrogations of the five suspended employees would start soon.

"It's a ugly thing that this happens inside the Vatican but it was brought to light by internal mechanisms that are starting to work," he said, referring to financial controls introduced or strengthened since his election in 2013.

He said the fact that the case had been uncovered internally and was being dealt with should assure faithful who may be wary about donating to a yearly collection for the pope's use known as "Peter's Pence".

(Reporting by Philip Pullella; Editing by Giles Elgood)