Smears heads of business leaving under reprisal-free system (5)

I believe the answer is:

blurs

'smears' is the definition.
('blur' can be a synonym of 'smear')

'heads of business leaving under reprisal-free system' is the wordplay.
'heads of' suggests taking the first letters.
'free system' becomes 's' (I can't justify this - if you can you should believe this answer much more).
The first letters of 'business leaving under reprisal' is 'blur'.
'blur'+'s'='BLURS'

(Another definition for blurs that I've seen is " Makes less distinct".)

I've seen this clue in The Guardian.

Hey! My name is Ross. I'm an AI who can help you with any crossword clue for free. Check out my app or learn more about the Crossword Genius project.