Executive Summary

This publication explores the role that the United Kingdom (UK) plays as a hub for the facilitation of global financial crime and corruption, as well as for services that can be utilised against journalists reporting on this topic. It argues that while the UK and its offshore jurisdictions are not the only locations used for the facilitation of financial crime and corruption, the extent to which the UK acts as a facilitator, both as a destination for illicit money and as the source of a wide range of enablers to support corrupt individuals and suppress public interest reporting is alarming. Moreover, this situation is damaging for the UK’s international standing at a critical time, post-Brexit, in which it is trying to establish future financial and trade relationships.

The UK’s poor reputation as a centre for financial crime and corruption has been repeatedly evidenced by significant transnational journalistic investigations and research by anti-corruption groups over the past decade. Yet rather than expediting measures to remedy this situation the UK Government appears to have been dragging its heels recently. Despite some positive steps made in the wake of the 2016 Anti-Corruption Summit in London seemingly straightforward solutions to create greater transparency and accountability, such as the Registration of Overseas Entities Bill first proposed in 2018, are still to be realised. The existence of a ‘London Laundromat’ and a growth industry of connected enablers garnered fresh attention and some official recognition in July 2020, with the release of ‘The Russia Report’ by the UK Parliament’s Intelligence and Security Committee (ISC). However, the UK Government’s response has been lacklustre and without follow up to date.

Meanwhile, journalists who have worked to shine a spotlight on corruption continue to face significant threats to their safety and security. Some of these threats have been instigated with the help of UK based law firms and reputation management companies. The personal testimonies of the five investigative journalists together with the contributions from anti-corruption and media freedom experts forming this publication serve to highlight two interlinked concerns:

– Firstly, the impact the UK’s facilitation of international financial crime and corruption has on media freedom, particularly when connected to political elites in countries with poor democratic records.

– Secondly, the enduring role London continues to hold as an international libel capital, despite reforms to English and Welsh law in 2013 intended to crack down on libel tourism, and the impact such legal action, or even the threat of it, in the UK can have on journalists here and abroad.

These point to weaknesses in the UK’s claim to be a global leader in the fight against illicit finance as well as a promoter of media freedom and safety of journalists around the world, despite having spearheaded, together with Canada, a Global Pledge on Media Freedom in 2019. As highlighted by the findings from a recent FPC global survey of journalists working to uncover financial crime and corruption, the UK not only features highly in journalists’ investigations (61% of respondents reported finding a link with UK jurisdictions), but is also a significant source of legal challenges against them. Of the 63 survey respondents in 41 countries, 73% reported receiving communication(s) threatening legal action (often referred to as SLAPPS – strategic litigation against public participation) as a result of information they had published. The respondents pointed to the UK as the highest international source of these legal challenges – almost as high as EU countries and the US combined. While calls are growing louder for anti- SLAPP regulation in the European Union, there remains an urgent need for policy and legislative intervention in the UK. This publication sets forth recommendations for the UK Government, and other key stakeholders, to take steps to address these issues and support public interest journalism.

Recommendations

Based on the research and contributions in this publication there are a number of suggestions for possible action.

For the UK Government:

– Recognise the vital role that journalists play in creating transparency and accountability and connect this to Government strategies to counter financial crime and corruption^[1] facilitated within its borders. In particular, by reviewing and updating the UK’s 2019-2022 Economic Crime Plan and the 2017-22 Anti-Corruption Strategy.

– Instigate an independent investigation or public inquiry into the ‘London Laundromat’ and connected growth industry of ‘enablers’, including the full extent of their impact, following the findings published in the UK Parliament’s Intelligence and Security Committee’s Russia Report in July 2020. This should take into account the environment for media freedom in countries where the political elites are using UK jurisdictions to launder money, as a destination for their illicit funds, or to buy legal, reputational, surveillance or other services aimed at suppressing reporting on crime and corruption.

– Expedite and effectively resource the introduction and implementation of the Registration of Overseas Entities Bill, requiring all overseas companies that own UK property to reveal the ultimate beneficial owner.

– Provide free and open access for journalists to all registries related to companies, land and property in the UK, as well as to databases providing information regarding judicial decisions. Ensure the authorities providing these services are adequately resourced to check the veracity of the information contained within these registries and respond to requests for information.

– Expedite and effectively resource all other anti-corruption initiatives that improve access to information and other mechanisms to strengthen public scrutiny and oversight. To this end the recommendations outlined in the 2019 ‘Fighting Corruption: A Manifesto,’ produced by Global Witness, Transparency International UK and The Sentry, and supported by a wider collation of the UK’s leading anti-corruption organisations provide a helpful guide for action^[2].

– Ensure the full implementation of the commitments the UK Government made as part of the 2016 Anti-Corruption Summit, including reviewing the effectiveness of whistleblowers protections, on which, to date, there has been no action^[3].

– Adopt at a legislative level, and implement, measures to combat strategic litigation against public participation (SLAPP). As part of this process, review and seek to reform legislation that can be misused to vexatiously threaten journalists; including but, not limited to, laws covering civil defamation, privacy, trade secrets, copyright and national security.

– Ensure all violations against journalists in the UK are promptly, thoroughly, independently and effectively investigated, with the perpetrators and instigators brought to justice. Speak out against violations taking place in other countries, acknowledging the role that an investigative journalist’s work – including on financial crime and corruption – may play in the motivation for the violation.

– Establish an independent fund to support public interest investigative journalism in the UK and abroad, including a focus on uncovering financial crime and corruption.

– Refrain from taking steps to break end-to-end encryption, which would endanger the safety and security of journalists and their sources.

For the devolved governments of Scotland and Northern Ireland:

– Adopt at a legislative level, and implement, measures to combat strategic litigation against public participation (SLAPP). As part of this process, review and seek to reform legislation that can be misused to vexatiously threaten journalists; including but, not limited to, laws covering civil defamation, privacy, trade secrets, copyright and national security.

– In particular, ensure reform of libel legislation reduces the possibility of its vexatious misuse, particularly as part of libel tourism.

– Provide free and open access to journalists to any local registries related to companies, land and property, as well as, databases providing information regarding judicial decisions.

For governments in UK overseas jurisdictions:

– Work with the UK Government to towards the speedy and effective implementation of a publicly accessible register of beneficial ownership for companies, based in your territories.

– Expedite and effectively resource all other anti-corruption initiatives that improve access to information and other mechanisms to strengthen public scrutiny and oversight, including timely responses to requests for information from journalists, wherever they are based in the world.

For national regulatory bodies covering the legal sector in the UK:

– Prioritise the issue of vexatious legal communication as one of serious concern undermining the reputation of the UK legal community.

– Provide guidance to lawyers and law firms on how to identify potential SLAPP cases and avoid the misuse of laws for the purpose of threatening journalists.

– Encourage the provision of pro-bono legal support to journalists and media outlets subject to vexatious legal communication and/or SLAPP lawsuits.

For organisations supporting journalists and media freedom in the UK and abroad (including NGOs, donor organisations, trade unions and associations):

– Provide more funding for legal defence and guidance on how to respond to vexatious legal communication and litigation (SLAPP).

– Seek to support funding opportunities for public interest journalism, including on topics related to financial crime and corruption.

For journalists and media:

– Report all incidences of threats made towards you to the appropriate authorities (where safe to do so) as well as to relevant regional monitoring mechanisms and media freedom NGOs. While not all incidences may receive immediate remedy or redress, such reports will create a better understanding of the threats faced, the instigators and methods used. This can support the development of stronger measures for protection and defence, as well as prioritisation of funding.

– Ensure that you have risk protections in place to guard against potential legal challenges, for example media liability insurance or pre-arranged pro-bono legal support you can turn to when incidents arise.

Image under (CC).

[1] FPC is using the World Bank’s definition of corruption – “the abuse of public office for private gain,” available on the World Bank’s website – http://www1.worldbank.org/publicsector/anticorrupt/corruptn/cor02.htm and the United Kingdom’s Financial Conduct Authority’s definition of financial crime “any kind of criminal conduct relating to money or to financial services or markets, including any offence involving: (a) fraud or dishonesty; or (b) misconduct in, or misuse of information relating to, a financial market; or (c) handling the proceeds of crime; or (d) the financing of terrorism;” – https://www.handbook.fca.org.uk/handbook/glossary/G416.html?filtertitle=financial%20crime

[2] Fighting corruption manifesto, TI-UK, October 2019, https://www.transparency.org.uk/publications/fighting-corruption-manifesto

[3] Protecting Whistleblowers, TI-UK, December 2020, https://www.anticorruptionpledgetracker.com/commitments/protecting-whistleblowers/