VATICAN CITY (AP) — The Vatican's financial watchdog agency on Wednesday strongly denied allegations of wrongdoing by Vatican prosecutors who ordered an unprecedented raid on its offices and seizure of confidential documents.

The board of the Financial Information Authority, which works with national financial intelligence units around the world in the fight against money laundering and other financial crimes, issued a statement Wednesday insisting the agency's activities were entirely proper.

An internal AIF investigation concluded that neither the authority's suspended director, Tommaso Di Ruzza, nor anyone else at the agency "improperly exercised his authority or engaged in any other wrongdoing."

The statement was issued by the Vatican press office in a sign of institutional backing.

Acting on orders from Vatican prosecutors, Vatican gendarmes searched AIF headquarters Oct. 1 and seized files and records in connection with an investigation into the Holy See's investment in a London real estate venture that went sour.

The raid sparked an institutional crisis and raised alarm internationally, given AIF's role as an independent watchdog authority over the Holy See's financial activities. Officials expressed alarm that other countries would be less willing to share sensitive information with the AIF in the future if that material could so easily end up in the hands of Vatican police.

According to the search warrant, which was seen by The Associated Press, prosecutors only alleged that the AIF's actions in the real estate operation were "not clear" and faulted Di Ruzza for being in contact with a London law firm. Prosecutors appeared to have misunderstood that AIF was working with Britain's financial intelligence unit to try to catch the businessmen who were fleecing the Holy See in the real estate deal.

The Vatican had put 150 million euros into the luxury apartment building in London's tony Chelsea neighborhood, only to see tens of millions end up in the pockets of middlemen managing the venture.

The Vatican's secretariat of state in 2018 decided to buy the building outright while working with British authorities to nab the middlemen. But internally, the Vatican bank and auditor general's office raised an alarm with Vatican prosecutors that the buyout looked suspicious, sparking the raids on AIF and the secretariat of state.

In the statement, AIF's board said it was "confident that potential misapprehensions will be clarified soon." It added that it had full faith and trust in Di Ruzza "and moreover commends him for the institutional work carried out in the handling of this particular case."

Di Ruzza's reputation, and that of four other Vatican employees suspended as part of the investigation, was tarnished further when a Vatican police flyer featuring their headshots, names and titles was leaked to an Italian newsmagazine. The Vatican police chief, who is Pope Francis' personal bodyguard, resigned as a result of the leak scandal.

The investigation has come at a sensitive time for the Vatican, as it prepares early next year for a regular visit by the Council of Europe's Moneyval evaluators, who monitor the Holy See's adherence to international norms to fight money laundering and terrorist financing.

Moneyval in the past has faulted Vatican prosecutors for the relatively few financial prosecutions carried out based on AIF reports of suspicious transactions.