Pope Francis launches inquiry into the Vatican bank in wake of corruption and money laundering scandals

Comes as Vatican official placed under investigation for money laundering

Previous leaks revealed dysfunction, turf wars and alleged corruption

The Vatican bank's workings have long been shrouded in secrecy

Pope Francis in St Peter's square today: He has announced a probe into the activities of the highly secretive and scandal-tainted Vatican Bank

Pope Francis ordered an inquiry into the activities of the Vatican bank today, after fresh accusations of corruption and continued questions about its secrecy.

Francis named a commission to investigate the bank's legal structure and activities 'to allow for a better harmonization with the universal mission of the Apostolic See,' according to the legal document that created it.

The announcement came after prosecutors in Salerno placed senior Vatican official Monsignor Nunzio Scarano under investigation for alleged money-laundering.

Scarano has said he did nothing wrong, though in an interview with the local daily, La Citta di Salerno, he acknowledged he received bad advice from his accountant.

The five-member commission includes two Americans: Monsignor Peter Wells, a top official in the Vatican secretariat of state, and Mary Ann Glendon, a Harvard law professor, former U.S. ambassador to the Holy See and current president of a pontifical academy.

American cardinals were among the most vocal in demanding a wholesale reform of the Vatican bureaucracy - and the Vatican bank - in the meetings running up to the March conclave that elected Francis pope.

The demands were raised following revelations in leaked documents last year that told of dysfunction, petty turf wars and allegations of corruption in the Holy See's governance.

It was the second time in as many weeks that Francis has intervened to get information out of the Institute for Religious Works, or IOR.

On June 15, he filled a key vacancy in the bank's governing structure, tapping a trusted prelate to be his eyes inside the bank.

Francis, who has made clear he wants a 'poor' church, has already named a separate commission of cardinals to advise him on the broader question of reforming the Vatican bureaucracy as a whole.

The Vatican bank was founded in 1942 by Pope Pius XII to manage assets destined for religious or charitable works.

Located in a tower just inside the gates of Vatican City, it also manages the pension system for the Vatican's thousands of employees.

Vatican City at dusk: Francis, who has made clear he wants a 'poor' church, has already named a separate commission of cardinals to advise him on the broader question of reforming the Vatican bureaucracy as a whole

The bank commission's members have the authority to gather documents, data and information about the bank's legal status and activities, even overriding normal secrecy rules to do so.

Members can receive information from anyone in the Vatican bureaucracy as well as people who spontaneously volunteer information, and the commission can refer to outside advisers if necessary, according to the terms.

The bank's administration continues to function as normal, as does the Vatican's new financial watchdog agency which has supervisory control over it.

The commission will report back to Francis - presumably with both information and recommendations - and then will be dissolved, the document states.

No timeframe was given but the commission is to start working soon.

Involved with the Vatican Bank: Roberto Calvi, the head of Banco Ambrosiano, was found hanging from Blackfriars Bridge in London in 1982

Vatican spokesman Rev. Federico Lombardi, confirmed today that Scarano had been suspended temporarily from his position in one of the Vatican's key finance offices, the Administration for the Patrimony of the Apostolic See.

Italian daily Corriere della Sera reported over the weekend that Italy's central bank had asked the Vatican's financial watchdog agency for information about Scarano's Vatican bank account as part of the probe.

Mr Lombardi said he didn't know if the Vatican had responded to the request.

There have long been questions about just what the IOR actually is and does - questions which the commission presumably will try to iron out for Francis.

Vatican officials have long insisted it's not even a bank, since it doesn't perform key banking activities like making loans.

It does however take deposits, transfer money and invest for its clients, performing asset management services that in 2012 helped earn it 86.6 million euros in profit on 7.1 billion euros in total assets under management.

Some cardinals have questioned if the Vatican needs such a financial institution and whether its activities are even in keeping with church teaching.

The Vatican bank's workings have long been shrouded in secrecy. Most famously, it was implicated in a scandal over the collapse of Italy's Banco Ambrosiano in the 1980s in one of Italy's largest fraud cases.