Financial crime watchdog Austrac scrutinised the transactions after Italian media reported in September that large sums of money had been sent to Australia during the trial of former Vatican treasurer Cardinal George Pell, who had faced charges of historical child sexual assault.

There was speculation in the media that some of the funds were sent to cover Pell’s legal costs or that some was sent by a rival in the Vatican to help build cases against him.

Pell was acquitted by Australia’s High Court last April after serving 13 months in jail on charges he assaulted two choirboys.

He returned to Rome last September.

After reviewing data provided by Austrac, the Australian Federal Police said nothing illegal had been uncovered related to the transactions.

“No criminal misconduct has been identified,” a spokesman for the police said in emailed comments, without elaborating on how the funds were used.

Austrac had originally put the sum transferred at A$2.3 billion, but slashed its estimate to a fraction of that amount after a shocked Vatican called for the watchdog to check its calculations.

Austrac blamed its miscalculation on complexities and inconsistencies in data it had received from international institutions.