The former president and ex-treasurer of the Vatican-run children's hospital have been indicted for allegedly diverting money from the hospital's foundation to pay for renovations on a top cardinal's apartment.
The indictment ordered Giuseppe Profiti and Massimo Spina to stand trial, starting next Tuesday.
It accuses the two of using €422,000 from the Bambino Gesu paediatric hospital's fundraising foundation to pay for renovations of Cardinal Tarcisio Bertone's apartment when he retired as the Vatican's secretary of state.
The cardinal has denied knowledge of the payment.
Mr Profiti, whose administration was the subject of a recent AP investigation into quality of care at the "pope's hospital", has admitted to the payment but said it was an investment so that the foundation could use the apartment for fundraising events.
Mr Bertone, who had appointed Mr Profiti president of the hospital in 2008, said he had actually paid for the renovations out of his own pocket.
That suggests that the construction company was paid twice for the same work.
Mr Bertone was not charged; while the fate of the construction company was not immediately clear.
Mr Profiti resigned as president of Bambino Gesu in January 2015, nine months into a new three-year term.
According to the AP investigation, a secret Vatican-authorised task force had reported in 2014 that under his administration, the mission of the pope's hospital had been "lost" and was "today more aimed at profit than on caring for children".
The AP investigation found that children sometimes paid the price as the hospital expanded its services and tried to cut costs, with overcrowding and poor hygiene contributing to deadly infection, including one 21-month superbug outbreak that killed eight children in the cancer ward.
The hospital has called the AP report a "hoax" and denied problems.
The current Vatican secretary of state Cardinal Pietro Parolin has acknowledged there were past problems that the current administration is working to fix.
At the same time the task force was investigating, a Vatican-ordered external audit by PricewaterhouseCoopers confirmed that the hospital's mission had been "modified in the last few years" to focus on expansion and commercial activities without sufficient governance controls.
The audit and details of the payment for the Bertone apartment renovations were first revealed in the 2015 book Avarice by Italian investigative journalist Emiliano Fittipaldi.
Mr Profiti, who now heads a small medical clinic in southern Campania, told the AP in a May 29 telephone interview that he had told Vatican prosecutors none of the money used from the foundation for the renovations had been intended for childcare.
He laughed when told of the results of the 2014 task force investigation and called it "rumour".
After the initial Vatican-authorised task force turned in its report in April 2014 after a three-month investigation, the Vatican ordered a second in-house clinical assessment into childcare.
After a three-day visit, that investigation found that the hospital in many ways was "best in class".