Troubled PR firm calls in the administrators

Blog Insolvency

A leading PR firm has gone into administration in the UK following a storm of controversy about a campaign it was running in South Africa, which critics claim had been “racially-charged”.

Bell Pottinger, which is based in Holborn, London, had gone up for sale last week but was unable to find a buyer before administrators were called in a couple of days ago.

Earlier this month, there had been a flurry of criticism over a campaign which had emphasised the influence of white-owned businesses. The firm had subsequently found itself ejected from the UK’s public relations trade body.

Following the furore, a succession of high-profile clients, including HSBC and Investec, confirmed they were severing ties with the firm.

Commentators said the financial losses which resulted were considerable and questions had been raised as to whether Bell Pottinger would be able to secure new business to ensure a viable future.

The firm had been set up almost 20 years ago, with Lord Bell, a former advisor to Margaret Thatcher, a founding member.

Despite expanding its operations around the world, Bell Pottinger had courted controversy on a number of previous occasions.

In 2011, The Independent had run a story after it was revealed that the firm’s executives boasted about the ways they bolstered the reputation of nations which had been accused of human rights infringements.

And last year there were further ructions over a deal done with the United States’ Department of Defence, in which it emerged military officials had agreed a multi-million package for the creation of fake terrorist videos.

It has now been confirmed that Lord Bell, who left the business last summer, is among Bell Pottinger’s creditors – and it is thought he is owed in the region of £300,000.