VATICAN CITY (RNS) Less than two weeks before he retires, Pope Benedict XVI on Friday (Feb. 15) approved the appointment of a German lawyer and financier as the new head of the scandal-plagued Vatican Bank.

Ernst von Freyberg will take on the role of president of the Istituto per le Opere di Religione, as the bank is formally known, nine months after former president Ettore Gotti Tedeschi was unceremoniously ousted by the bank’s board with a no-confidence vote.

But von Freyberg’s appointment immediately sparked controversy. The lawyer will remain in his current role of chairman of the executive board of German shipyard Blohm + Voss, which was involved in the production of warships under Nazi Germany.

Vatican spokesman Rev. Federico Lombardi said that the shipyard is currently involved in engineering and ship repair activities, as well as in the production of luxury yachts. But he also acknowledged that Blohm + Voss is “part of a consortium that is building four frigates for the German navy.”

Benedict “expressed his full consent to the choice made by the Commission of Cardinals,” according to the Vatican.

The outgoing pope has pushed hard to shed the Vatican’s reputation as a suspect and secretive financial center. He has set up an independent financial watchdog and sought recognition from a European overseeing authority.

But those efforts risk being overshadowed by Italian investigations into the Vatican Bank for alleged money laundering.

In a statement, the Vatican stressed that von Freyberg’s appointment was the result of a “painstaking and detailed” selection process.

For the first time, the Vatican hired an international headhunting agency to pick a candidate of “professional and moral excellence.”

The agency, Spencer Stuart, submitted a roster of three names to the cardinals’ commission overseeing the bank — headed by Vatican Secretary of State Tarcisio Bertone — that then chose von Freyberg.

Since December 2011, Blohm + Voss warship building arm, Blohm + Voss Naval, has been a separate company from Blohm + Voss shipyard.

But von Freyberg’s involvement with the company dates back from before the split. In fact, Blohm + Voss confirmed that the Vatican Bank president is a descendant of one of the shipyard’s founders.

DSB/AMB END SPECIALE