As part of our Unsafe for Scrutiny project, the Foreign Policy Centre (FPC) is starting a new series of fortnightly articles focused on topics at the intersection of anti-corruption and safety of journalists. Featuring journalists as well as media freedom and anti-corruption experts, the series will provide insider perspectives on emerging issues or developing events. To launch the series, Susan Coughtrie, Unsafe for Scrutiny’s Project Director, rounds up what has already been an eventful couple of months since the release of FPC’s Unsafe for Scrutiny report in December 2020.
Unsafe for Scrutiny: Russian anti-corruption protests, ‘historic’ US anti-money laundering legislation, ‘Chumocracy’ and threats to freedom of information in the UK
It has been a mere two months since the release of FPC’s December report, which highlights how the misuse of the UK’s financial and legal systems to facilitate corruption undermines the freedom and safety of investigative journalists around the world. Yet in that relatively short space of time there have been several developments on both sides of the Atlantic pertinent to the FPC’s focus on issues at the nexus of safety of journalists and anti-corruption. These have served to place a renewed spotlight on the actions, or inaction, of the UK Government that has an impact both domestically and abroad. Below is round up of key stories and why they matter:
- Russia: Navalny’s revelations, anti-corruption protests and attacks on journalists
- UK: Exposure of London firms supporting corrupt figures and a planned ‘crackdown’ on formation agents
- UK: The ‘rise of Chumocracy’ in the time of COVID and the need to protect freedom of information
- US: ‘Historic’ anti-money laundering legislation, overturned sanctions and Trump’s Scottish UWO challenge
- End Notes: Strategic Litigation against Public Participation (SLAPPS) and the impact on journalists
Russia: Navalny’s revelations, anti-corruption protests and attacks on journalists
The decision by Alexei Navalny, Russian opposition leader and anti-corruption campaigner, to return to his homeland in January 2021, five months after an almost successful assassination attempt, was always going to be provocative. Few would have been surprised at his swift arrest upon arrival, particularly after Navalny, together with investigative news outlets Bellingcat and The Insider, published reports implicating Russian Federal Security Bureau (FSB) agents in his poisoning.[1] What was not as predictable was the scale of the mass protests in response not only to his arrest but also the release of an almost two hour YouTube video entitled ‘Putin’s palace. History of world’s largest bribe.’[2] Posted on 19 January 2021, with its host already detained, Navalny’s video alleges that Putin, through personal and business connections, laundered money to build an extravagant palace on the Black Sea estimated to be worth over a billion USD. To date, the video has over 110 million views, with independent pollsters at the Levada Centre estimating that at least 1 in 4 Russians have watched it.[3]
Those who have taken to the streets across the country since 23 January have been met with violence and mass arrests, including independent media. The Justice for Journalists Foundation (JFJ), which kindly supports FPC’s Unsafe for Scrutiny project, have documented what they describe as “unprecedented repressions” against media during the protests. JFJ recorded 195 incidents of detentions and arrests of professional and citizen journalists between 16 January and 3 February 2021.[4] Their report notes: “the clearly marked PRESS vests, editorial tasks and press cards served as a reason for the journalists’ detention, rather than their protection from the police and the riot units (OMON).” The already dire situation for media freedom and safety of journalists in the country was powerfully outlined by Dmitry Velikovsky, Russian investigative journalist working for iStories, in his contribution to FPC’s December report – Investigative journalism in today’s Russia, and why the UK’s stance could actually make a difference.[5]
Several UK MPs have responded to the recent events in Russia by calling on the UK Government to “rapidly impose sanctions on individuals responsible for ordering, conducting and aiding human rights abuses against peaceful protestors, journalists, citizens and opposition politicians in Russia.”[6] While the UK introduced ‘Magnitsky’ style sanctions last July, and utilised them in October against those alleged to be involved in Navalny’s poisoning, they have yet to be extended to cover corruption.[7]
However, the UK can make a significant difference by actively shutting down avenues within its jurisdiction for money laundering by corrupt political elites. On 25 January 2021, the Director General of the National Economic Crime Centre, Graeme Biggar, described the ‘disturbing’ prevalence of Russian money being laundered in London.[8] This is a fact that has already been well documented by successive journalistic investigations. Moreover given this was a key finding of the ‘Russia Report’ published by the UK Parliament’s Intelligence and Security Committee (ISC) in July 2020, the UK’s Government’s action to delay the release of the report, and its subsequent inaction to follow up, could perhaps be described as equally ‘disturbing’.[9]
UK: Exposure of London firms supporting corrupt figures and a planned ‘crackdown’ on formation agents
The role that UK firms have played in enabling corrupt figures has again hit the news recently. Highlighted in ISC’s Russia Report as “a growth industry of ‘enablers’ including lawyers, accountants, and estate agents,” these services are utilised beyond those tied to Russia. On 1 February 2021, OCCRP together with The Sarawak Report published a joint investigation revealing the role that London firm Henley & Partners played in obtaining a Cypriot passport for disgraced financier Jho Low, who stands accused of stealing billions from Malaysia’s sovereign wealth fund 1MDB.[10] Their investigation reveals that, despite identifying Low as a high-risk client with political exposure, Henley & Partners continued to assist him utilising a Cypriot company as an intermediary. Less than a week later, the US Department of Justice (DoJ) served an arrest warrant to London law firm Clyde & Co to recoup what are believed to be the proceeds of the 1MBD scandal, held in their accounts on behalf a client.[11]
The ease with which those accused of corruption are able to access a wide number of services is strongly contrasted by the challenges faced by journalists trying to expose their wrongdoing. Clare Rewcastle Brown, founder of The Sarawak Report, described in her article for FPC – A scandal of corruption and censorship: Uncovering the 1MDB case in Malaysia – the incredible amount of harassment she has faced including surveillance, smear campaigns and digital hacking on top of significant legal challenges. Ultimately, Rewcastle Brown’s reporting led to the downfall of the former Malaysian Prime Minister, Najib Razak, who is now in prison and Low is currently on the run from justice in Malaysia, Singapore and the US. The importance of her work clearly speaks for itself, and underscores the need to ensure the protection of journalists from all forms of threat and harassment.
In positive news, however, the National Crime Agency (NCA) has announced this month its intention to ‘crackdown’ on trust and company service providers, otherwise referred to as formation agents of which there are more than 20,000 in the UK.[12] The NCA stated its concern that “in some cases, formation providers may be complicit in illegality, or at least may be operating in breach of anti-money- laundering laws”. The use of anonymous shell companies in UK jurisdictions for illegal activities was touched on in two essays for FPC by journalists who face significant challenges when attempting to ‘follow the money’: in Chișinău to London: A story about big money and small information by Alina Radu, Editor in Chief of Moldovan investigative news outlet Ziarul de Garda; and Tracking corruption from the heart of Europe to UK Overseas Territories: murder, death threats and a wall of silence, by Slovak investigative journalist Peter Sabo from news outlet Aktuality.sk and Pavla Holcová, founder of the Czech independent outlet Investigace.cz.
While the NCA’s announcement is a step in the right direction there has to date been a persistent ‘enforcement gap’ in the UK in terms of tackling financial crime and corruption. As Ben Cowdock and Rachel Davis Teka from Transparency International UK pointed out in their article for FPC – How UK anti-corruption groups work with journalists to push for change – this has been in part due to limited resources invested in the relevant authorities. It is not yet clear what the NCA’s plans will look like and with parallel reforms to Companies House slow to be implemented there is still a way to go before any impact is felt. As Cowdock and Davis Teka have argued this makes the role of journalists, who have both specialist expertise both in how the UK’s financial systems facilitate this corruption as well as the contextual situations in countries around the world, so vital.
UK: The ‘rise of Chumocracy’ in the time of COVID and the need to protect freedom of information
During the COVID pandemic, the UK Government’s response has been beset by allegations of cronyism frequently described as ‘chumocracy’. A joint investigation published last week by The Byline Times and The Citizens revealed: “Government contracts worth £881 million have been awarded to individuals who have donated a total of £8.2 million to the Conservative Party in recent years.”[13] Greater transparency around decision-making and the handling of the COVID response is crucial not least to improve public confidence, both in the health measures put in place as well as how taxpayers’ money has been spent, particularly at a time of economic hardship for many.
Yet the pandemic has also raised concerns regarding the UK Government’s own attitude to journalists, which were encapsulated by Index on Censorship’s Jessica Ní Mhainín in her piece for the FPC – The UK and media freedom: An urgent need to lead by example. In 2020, journalists from at least four media outlets were denied access to a government briefing in February, a journalist was banned from asking questions at a government press briefing in May, and in September the media outlet Declassified was blacklisted by the Ministry of Defence, for which it later received an apology.[14]
Media outlet openDemocracy has since launched a petition with a view to taking legal action against the UK Government for what they describe as “a secretive unit inside Michael Gove’s Cabinet Office that’s been accused of ‘blacklisting’ journalists and blocking the release of ‘sensitive’ information.”[15] This week their initiative received the backing of editors across Fleet Street, who in a rare show of unity signed openDemocracy’s public letter calling for MPs to urgently investigate the British government’s handling of Freedom of Information (FOI) requests.[16] Amongst the signatories is The Times Editor John Witherow, who commented: “Transparency is not a privilege or a gift bequeathed to a grateful citizenry by a benign government. It is a fundamental right of a free people to be able to see and scrutinise the decisions made on their behalf.”
However, another potential threat to the application of was seen off last week as a tribunal ruled against limiting access to the Freedom of Information Act (FOIA) 2000 to UK citizens living in the UK.[17] The ruling came after several appeals from journalists based outside the UK, including one British citizen based in Hong Kong, had been refused access to information. A barrister representing one of the journalists stated after the ruling that “Journalists, individuals and organisations outside the UK play a crucial role in ensuring transparency and fighting misinformation, both in the UK and more widely. The FOIA, for all its challenges, is key to that.”
US: ‘Historic’ anti-money laundering legislation, overturned sanctions and Trump’s Scottish UWO challenge
The US has experienced a rollercoaster couple of months as outgoing President Donald Trump refused to accept that he was on the way out. Perhaps slightly overlooked in an already crowded news agenda was the approval of the Anti-Money Laundering Act of 2020, which has been described as “the most comprehensive set of reforms to the anti-money laundering (‘AML’) laws in the United States since the USA PATRIOT Act was passed in 2001.”[18] The move has been hailed as a ‘historic’ development by anti-corruption campaigners like Transparency International.[19] Amongst other measures, it introduces requirements to provide information about beneficial ownership putting an end to the practice of anonymous shell companies operating inside the country. Depending on how quickly this is implemented, it could see the US overtake efforts made by the UK to introduce similar limits on anonymous beneficial ownership.
However, in one of his last acts as President, Trump, who has himself long been dogged by corruption allegations, lifted the sanctions against Israeli businessman Dan Gertler that had been in place since 2017.[20] An investigation published in the summer of 2020 by Global Witness and the Platform for the Protection of Whistleblowers in Africa (PPLAAF) into a suspected international money laundering network that seemingly allowed Gertler continue his dealings in Africa despite the previous sanctions, resulted in both organisations being subject to various forms of intimidation including online harassment and legal challenges.[21] There have already been appeals to President Biden to reinstate the sanctions against Gertler. Biden’s administration indicated even before entering office that cracking down on illicit finance at home and abroad would be a top priority.[22]
Meanwhile Trump has faced down perhaps one of his more surprising challenges this month as MSPs debated whether Trump’s local business interests in Scotland should be investigated through an Unexplained Wealth Order (UWO), but ultimately voted to reject the motion.[23]
End Notes: Strategic Litigation against Public Participation (SLAPPS)
Last but not least, the FPC’s Unsafe for Scrutiny project has been increasing its focus on vexatious legal threats often referred to as strategic litigation against public participation (SLAPPs). Legal threats came out as the main concern in FPC’s global survey of 63 investigative journalists in 41 countries last year. The survey findings, published in November 2020, also pointed to the UK as the leading source of international legal threats.
Following on from the European Centre for Press and Media Freedom’s (ECPMF) essay on The increasing rise, and impact, of SLAPPs: Strategic Lawsuits Against Public Participation, a short explainer on SLAPPs and the impact on journalists is now accessible on FPC’s website here.
For those who enjoy podcasts, I spoke with Lana Estemirova host of the ‘Trouble with the Truth’ podcast about ‘SLAPPs, corruption and dirty money: how UK firms help silence investigative journalism’ released on 25 January 2021, which is available to listen to here.
[1] Bellingcat Investigative Team, FSV Team of Chemical Weapon Experts Implicated in Alexey Navalny Novichok Poisoning, Bellingcat, December 2020, https://www.bellingcat.com/news/uk-and-europe/2020/12/14/fsb-team-of-chemical-weapon-experts-implicated-in-alexey-navalny-novichok-poisoning/; Laboratory. How FSB NII-2 employees tried to poison Alexei Navalny, The insider, December 2020, https://theins.ru/politika/237705
[2] Alexey Navalny, Putin’s palace. History of world’s largest bribe, YouTube, January 2021, https://www.youtube.com/watch?v=ipAnwilMncI
[3] Film “Palace for Putin”, Levada Centre, February 2021, https://www.levada.ru/2021/02/08/film-dvorets-dlya-putina/
[4] Unprecedented repressions against Russian professional and citizen journalists, Justice for Journalists, February 2021, https://jfj.fund/unprecedented-repressions-against-russian-professional-and-citizen-journalists/
[5] I-Stories, https://istories.media/en/
[6] Democracy, human rights and the detention of Alexei Navalny, EDM 1390: tabled on 25 January 2021, UK Parliament, https://edm.parliament.uk/early-day-motion/58006/democracy-human-rights-and-the-detention-of-alexei-navalny-in-russia
[7] Catherine Philp, Alexei Navalny: Putin’s inner circle sanctioned over novichok attack, The Times, October 2020, https://www.thetimes.co.uk/article/alexei-navalny-putins-inner-circle-sanctioned-over-novichok-attack-zsmhx66ff
[8] Stefan Boscia, Top official warns of ‘disturbing’ amount of Russian money laundering in UK, City a.m., January 2021, https://www.cityam.com/top-official-warns-of-disturbing-amount-of-russian-money-laundering-in-uk/
[9] Intelligence and Security Committee of Parliament, Russia, Independent.gov.uk, 2020, https://docs.google.com/a/independent.gov.uk/viewer?a=v&pid=sites&srcid=aW5kZXBlbmRlbnQuZ292LnVrfGlzY3xneDo1Y2RhMGEyN2Y3NjM0OWFl
[10] OCCRP and Sarawak Report, A Key Plater in Malaysia’s Biggest-Ever Corruption Scandal Found Sanctuary in Cyprus With Help From a Major London Firm, OCCRP, February 2021, https://www.occrp.org/en/investigations/a-key-player-in-malaysias-biggest-ever-corruption-scandal-found-sanctuary-in-cyprus-with-help-from-a-major-london-firm
[11] Harry Davies, Warrant served on UK law firm over alleged 1MBD assets, The Guardian, February 2021, https://www.theguardian.com/world/2021/feb/07/arrest-warrant-served-on-uk-law-firm-over-alleged-1mdb-assets?
[12] James Hurley, Formation agents facing crackdown over organised crime links, The Times, February 2021, https://www.thetimes.co.uk/article/formation-agents-facing-crackdown-over-organised-crime-links-0vfdhn3k6
[13] Byline Times and The Citizens, The Crony Ration: £800 million in COVID contracts to donors who have given £8 million to Conservatives, Byline Times, February 2021, https://bylinetimes.com/2021/02/05/crony-ratio-conservative-donations-government-coronavirus-contracts/
[14] Charlotte Tobitt, MoD apologises after press office refused to engage with Declassified journalists, PressGazette, September 2020, https://www.pressgazette.co.uk/mod-apologises-after-press-office-refused-to-engage-with-declassified-journalists/
[15] Stop the secrecy: save our Freedom of Information, openDemocacy, https://www.opendemocracy.net/en/save-our-foi/
[16] Mary Fitzgerald and Peter Geoghegan, Fleet Street editors unite to demand ‘urgent’ action on Freedom of Information, openDemocacy, February 2021, https://www.opendemocracy.net/en/opendemocracyuk/fleet-street-editors-demand-urgent-action-to-protect-freedom-of-information/
[17] Bill Goodwin, ‘Victory for free speech and openness’ after tribunal confirms no territorial restrictions to FOIA, ComputerWeekly.com, February 2021, https://www.computerweekly.com/news/252495653/Victory-for-free-speech-and-openness-after-tribunal-confirms-no-territorial-restrictions-to-FOIA
[18] The Top 10 Takeaways for Financial Institutions from the Anti-Money Laundering Act of 2020, Gibson Dunn, January 2021, https://www.gibsondunn.com/the-top-10-takeaways-for-financial-institutions-from-the-anti-money-laundering-act-of-2020/
[19] Richard Hall, US passes ‘historic’ anti-corruption law that effectively bans anonymous shell companies, Independent, January 2021, https://www.independent.co.uk/news/world/americas/us-passes-historic-anti-corruption-legislation-that-effectively-bans-anonymous-shell-companies-b1781380.html
[20] Peter Fabricius, Magnitsky Act: Departing Trump lifted US sanctions against controversial Israeli businessman Dan Gertler, Daily Maverick, January 2021, https://www.dailymaverick.co.za/article/2021-01-24-departing-trump-lifted-us-sanctions-against-controversial-israeli-businessman-dan-gertler/
[21] Intimidation and scare tactics won’t work on us – we will continue to demand real action to bring greater transparency to DRC’s mining sector, Global Witness, July 2020, https://www.globalwitness.org/en/blog/intimidation-and-scare-tactics-wont-work-on-us-we-will-continue-to-demand-real-action-to-bring-greater-transparency-to-drcs-mining-sector/
[22] Amy Mackinnon, Biden Expected to Put the World’s Kleptocrats on Notice, Foreign Policy, December 2020, https://foreignpolicy.com/2020/12/03/biden-kleptocrats-dirty-money-illicit-finance-crackdown/
[23] MSPs reject calls for probe into Donald Trump golf courses, BBC News, February 2021, https://www.bbc.co.uk/news/uk-scotland-scotland-business-55912670
This article was produced as part of the Unsafe for Scrutiny project, which is kindly funded by the Justice for Journalists Foundation.