HRW: US must investigate, regulate Saudi Arabia PIF

A leading rights group has called on the United States to investigate and regulate foreign sovereign wealth funds such as Saudi Arabia’s Public Investment Fund (PIF), citing its involvement in human rights violations amid its increasing influence.

In a testimony before the US Senate Permanent Subcommittee on Investigations yesterday, which examined the PIF’s growing and substantial holdings in the US, the group Human Rights Watch (HRW) highlighted the Fund’s key role in Saudi Arabia’s poor human record and the threat it could potentially pose to the business environment within America.

According to Joey Shea, HRW’s Saudi Arabia researcher, the Kingdom’s Crown Prince, Mohammed Bin Salman, “has shown a clear interest in expanding his influence beyond Saudi’s borders, often through high-profile business deals with sports teams and leagues”. She added that “US businesses considering a handshake with Saudi’s PIF should undertake extremely rigorous due diligence to ensure that sovereign wealth funds that invest in US companies are not furthering human rights abuses.”

The hearing comes only months after a merger between the Professional Golf Association (PGA) and the PIF-owned LIV Golf was announced back in June, furthering the influence of the Saudi Fund in the US’s sports industry and fuelling criticism of what many call the Kingdom’s attempt to ‘sportswash’ its human rights record. Other notable investments by the PIF into the economies of the US and other countries include key sectors such as technology, entertainment and finance.

“It’s important that the US Congress is looking into the influence of the Saudi Fund into US business,” Shea stressed. “The Biden administration should be taking similar cautions in its further engagement with the Saudi government, given its rights record and how it is using its billions to launder its image.”

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Saudi Arabia’s PIF has, over the past six years, become mired in a series of political controversies and human rights violations, sometimes far beyond the Kingdom’s borders. One of those were the “anti-corruption” crackdown in 2017, which gathered hundreds of Saudi businessmen, former and current government officials, and even royal family members in the Ritz-Carlton hotel in the capital, Riyadh, where they were reportedly detained, interrogated, beaten and forced to give up business shares and other valuable holdings to the Saudi government.

It has been seen as one of the greatest cases of business, financial and property extortion by a government, with Crown Prince Mohammed bin Salman being the leading figure and the PIF the biggest beneficiary in that.

Another violation in which the Fund was involved was the 2018 assassination of Saudi journalist, Jamal Khashoggi, in Istanbul, with investigation documents having reportedly indicated that the Saudi security operatives who travelled to the city to execute the act were flown in two planes owned by Sky Prime Aviation, a charter jet company that had been transferred to the PIF following the crackdown the year before.

According to documents in a Canadian lawsuit that were seen by HRW, around 20 companies were captured as a result of the crackdown and transferred directly into the PIF under the instructions of bin Salman.

While countries’ sovereign wealth funds are usually separate and not wholly under the control of the heads of their governments, Saudi Arabia’s PIF is almost exclusively under the control and influence of the Crown Prince.

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