It sounds like something out of Father Ted: a renowned monastery in Rome where monks staged concerts featuring a lap-dancer-turned-nun and opened a hotel with a 24-hour limousine service has been shut down by the pope.

As part of Benedict XVI's crackdown on "loose living" within the Catholic church, 20 or so Cistercian monks are now being evicted from the monastery at the basilica of Santa Croce in Gerusalemme, which hosts some of the church's holiest relics.

"An inquiry found evidence of liturgical and financial irregularities as well as lifestyles that were probably not in keeping with that of a monk," said Father Ciro Benedettini, a Vatican spokesman. "The church remains open but the monks are awaiting transfer."

Reports saying the monks amassed large debts have also emerged, but Benedettini declined to give further details of the Vatican report, which was signed off in March.

The monks' days have been numbered since 2009, when the Vatican sacked their flamboyant abbot, Father Simone Fioraso, a former fashion designer who built up a cult following among Rome's fashionable aristocratic crowd as well as show business worshippers such as Madonna, who prayed at the church in 2008.

In 2009 Anna Nobili, a nightclub dancer who became a nun, was invited to perform her "holy dance" before an audience including archbishop Gianfranco Ravasi, head of the Vatican's cultural department. For her performance Nobili, who says she uses dance as a form of prayer, lies spread-eagled in front of the altar clutching a crucifix or twists and turns as in pole-dancing routines.

Dating back to the 4th century, Santa Croce in Gerusalemme was built to house relics brought back from the Holy Land by the mother of Emperor Constantine.

They include items described as nails and splinters from the cross, thorns from Jesus's crown, and a bone from the finger St Thomas pushed into the wounds of Christ.

The monks living there now had opened a shop selling organic produce from their kitchen garden, but this was shut down in 2009 amid accusations of their having secretly stocked the shelves from a neighbourhood grocery.

The Italian newspaper La Stampa said that VIP guests were also encouraged to stay at a hotel opened at the Santa Croce monastery which offered a 24-hour limousine airport service.

In 2008 Fioraso hosted a week-long, televised, reading of the bible with religious figures, politicians and celebrities reading tracts, starting with Pope Benedict himself. But a year later Fioraso was ousted, despite protests from parishioners who defended his "patience, dedication, sacrifice and passion".

The Vatican's removal of the monks to other monasteries, ending their 500-year presence at the basilica, follows Benedict's hard line with other wayward orders, including the Legionaries of Christ, run by the Mexican priest Marcial Maciel Degollado, who fathered numerous children, was disciplined over sexual abuse allegations and was banished to a life of penitence.

The basilica was supported by the Friends of Santa Croce, a who's who of Roman society run by a Italian claiming descent from Charlemagne.

Italian press reports have speculated that the inspectors from the Vatican suspected homosexual relations between monks at the monastery.