News: New report highlights PR industry’s conundrum in fight against money laundering and kleptocracy

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A new report, ‘What’s the Risk? PR & Communications Agencies and Kleptocracy’, by Thomas Mayne, research fellow at the University of Oxford, and published by the Foreign Policy Centre, was launched on Monday at an event in the Houses of Parliament. The report highlights several concerns about the role of UK PR and communication agencies when representing clients from kleptocratic jurisdictions.

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The Rt Hon Liam Byrne MP, co-chair of the APPG on Anti-Corruption and Responsible Tax, led the panel discussion with the report’s author, Thomas Mayne, together with Farzana Baduel, CEO of Curzon PR, and Franz Wild, editor of The Bureau of Investigative Journalism. Opening remarks were provided by Alastair McCapra, CEO of the Chartered Institute of Public Relations (CPIR), the professional body for PR practitioners in the UK.

The report finds the public relations (PR) industry in the UK generates billions annually, is largely unregulated, and presents a conundrum in the fight against money laundering and kleptocracy. PR agents are often deployed in a multiplicity of roles for clients, suggesting methods of influence and helping to establish networks by introducing the client to other professionals and influential individuals. The path to being accepted within UK society – acquiring property, residency, and even citizenship – can be smoothed if an individual’s past can be laundered through PR activities that stress the value they can bring while whitewashing past misdeeds. Both individuals and companies can work with communication agencies and PR professionals to gain influence in our political system, with PR work overlapping with lobbying and public affairs firms. These networks can become powerful systems in their own right and can not only aid the flow of illicit funds from kleptocracies but also help such systems become entrenched through reputation laundering. Anyone can set themselves up as a PR agent with no qualifications or expertise. Currently, PR professionals are not required to perform any due diligence on their clients and, unlike regulated professionals, do not require any special training or qualification to perform public relations work. Without regulation, PR agents are guided by nothing but their own ethics, and the codes of conduct established by the existing professional bodies that have no impact on those who are not members of these bodies.

Rt Hon Liam Byrne MP said, “Our country is still one of the world’s favourite places for economic crime. Kleptocrats have a multi-step process – they steal money, hide money, migrate, spend the money, dodge law enforcement, then launder their reputations to protect themselves. Many come to London because we are a one-stop shop for all the expert advisors you need. What we see as MPs is that reputation-laundering is at the interface of inequalities of wealth becoming inequalities of power. You cannot acquire power, no matter your level of wealth, unless you go through a process of reputation-laundering.”

Thomas Mayne, research fellow, University of Oxford and report author said, “PR professionals have largely flown under the radar when it comes to the fight against dirty money and kleptocracy. However, this report shows how PR agents can play a key role in laundering the reputation of corrupt players from overseas and help them to establish networks within the UK. The flow of dirty money into the UK can have a deleterious effect on not only our financial centre, but also our political, charitable and educational sectors. There it is vital that we understand the risks and can mitigate against them. Hopefully this report will act as a starting point for that conversation within the PR world.”

Alastair McCapra (pictured), CIPR CEO said, “This report reveals an uncomfortable truth. It shows that public relations is recognised as a powerful tool and the UK industry a center of excellence. At the same time, it also finds PR being used as a professional enabler that has allowed kleptocratic wealth to thrive in Britain. PR is particularly vulnerable to penetration by those with very different values to us and sometimes even nefarious intentions. With no shortage of demand for our services, we must work actively to make the UK a hostile environment for kleptocrats.”