Douglas Caddy

Rebekah Brooks Resigns From Murdoch’s British Subsidiary The New York Times By JOHN F. BURNS and ALAN COWELL July 15, 2011 LONDON — After days of mounting pressure from politicians and investors, Rebekah Brooks, the embattled chief executive of Rupert Murdoch’s British newspaper operations, announced her resignation on Friday in another stunning blow to Mr. Murdoch’s once all-powerful empire, now under investigation in Britain and the United States. Her resignation came a day after Mr. Murdoch, the chairman of News Corporation, and his son James reversed themselves and said they would testify next week before a parliamentary panel probing the cascading scandal over phone hacking that has forced the closure of The News of the World tabloid and the collapse of a $12 billion bid to assume full control of Britain’s biggest satellite broadcaster. Until the scandal erupted, Ms. Brooks, 43, had been a star within News International, the British newspaper subsidiary of Mr. Murdoch’s News Corporation, editing two influential tabloids and rising rapidly to head the division. British analysts described her as enjoying the status of a favored daughter, with close ties not only to the Murdoch family but also to leading politicians. But her resignation had seemed ever more likely as police arrested some of her former colleagues, politicians on the benches of Parliament demanded her resignation, the price of stock in Murdoch holdings faltered and investors voiced concern. Late Thursday, BBC television broadcast an interview with Prince Al-Waleed bin Talal of Saudi Arabia, identified as News Corporation’s second biggest shareholder, in which he said that if Ms. Brooks was involved in wrongdoing “for sure she has to go.” Ms. Brooks, who has denied that she knew of the phone hacking while she was editor of The News of the World, said in an e-mail to her staff, “My desire to remain on the bridge has made me a focal point of the debate. This is now detracting attention from all our honest endeavors to fix the problems of the past. Therefore I have given Rupert and James Murdoch my resignation. While it has been a subject of discussion, this time my resignation has been accepted.” She was replaced by Tom Mockridge, the head of Sky Italia, News Corporation’s Italian satellite broadcaster. Prime Minister David Cameron, once regarded as a personal friend of Ms. Brooks, but who later followed opposition leader Ed Miliband in demanding her resignation, said she had made “the right decision.” The move came at a sensitive juncture, as the Murdoch family shifts to a more assertive posture to try to limit the damage from what has become its most serious crisis of credibility. James Murdoch said that News International would place advertisements in all British national newspapers over the weekend “to apologize to the nation for what has happened.” British news media on Friday published the text and images of the ad, which is signed by Rupert Murdoch alone and begins in large type: “We are sorry.” “We regret not acting faster to sort things out,” the ad reads in part. “I realize that simply apologizing is not enough. In the coming days, as we take further concrete steps to resolve these issues and make amends for the damage they have caused, you will hear more from us.” Rupert and James Murdoch said on Thursday that they would testify next week before a parliamentary panel investigating the scandal, abandoning earlier efforts to avoid or put off appearing before the panel. Mr. Cameron has called for a separate inquiry, to be headed by a senior judge. On Friday, former staff members at The News of the World questioned why Ms. Brooks had not resigned earlier. “Our paper was sacrificed to save her career, and now she’s gone as well,” one former employee said, requesting anonymity because he did not wish to jeopardize his position in severance negotiations following the newspaper’s closure. “Who knows why they’ve chosen to do it now, as she’ll have to appear before the select committee anyway.” Others faulted News Corporation for what they called a slow and piecemeal response to the crisis. “This is too little too late,” said Michelle Stanistreet, the head of the National Union of Journalists. “This will be cold comfort to the hundreds of journalists who have lost their jobs at The News of the World.” With bewildering speed, the pace of the unfolding disclosures has stripped away the Murdoch family’s image as ironclad arbiters of British public life — the people politicians had to go to if they wanted to win elections, as Mr. Cameron did before the 2010 election. Before him, Tony Blair was also seen as eager to keep Mr. Murdoch’s support. Questions about the news-gathering techniques employed by News International had been under largely ineffective scrutiny by the police and Parliament for years, and many outsiders believed that the phone hacking was restricted to the phones of prominent people. Then, at the beginning of last week, reports emerged that The News of the World had ordered the hacking of voice mail left for Milly Dowler, a 13-year-old girl who had been abducted and murdered. That episode shocked many Britons and triggered other disclosures of hacking into the phones of terrorism victims, possibly including some of those who died in the attacks on Sept. 11, 2001 in the United States. Ms. Brooks was editor of The New of the World at the time. The Dowler family lawyer, Mark Lewis, said he was pleased Ms. Brooks had resigned because News International had ruined lives. Mr. Miliband, the leader of the Labour opposition, who take the lead among British politicians demanding Ms. Brooks’ resignation, said on Friday: “It is right that Rebekah Brooks has finally take responsibility for the terrible events that happened on her watch, like the hacking of Milly Dowler’s phone.” “But, as I said when called for her resignation 10 days ago, this is not just about one individual but about the culture of an organization.” British media analysts, moreover, have begun to ask more loudly what role James Murdoch, News Corporation’s most senior executive in Europe, played in the way the British newspapers were run. In the United States, meanwhile, the Federal Bureau of Investigation in New York has opened a preliminary inquiry into allegations that News Corporation journalists sought to gain access to the phone records of victims of the Sept. 11 attacks, according to several people briefed on the matter. With the scandal spreading beyond Mr. Murdoch’s British outpost, major investors in the much bigger parent company, News Corporation, began questioning what was going on. In Britain, Mr. Murdoch owns The Times of London, The Sunday Times and the top-selling daily tabloid, The Sun. He also holds a 39 percent interest in British Sky Broadcasting. His much more lucrative United States holdings include Fox News, The Wall Street Journal and the New York Post. Mr. Murdoch had previously rejected two offers from Ms. Brooks to resign. In her farewell message, Ms. Brooks said: “At News International we pride ourselves on setting the news agenda for the right reasons. Today we are leading the news for the wrong ones. The reputation of the company we love so much, as well as the press freedoms we value so highly, are all at risk. As chief executive of the company, I feel a deep sense of responsibility for the people we have hurt and I want to reiterate how sorry I am for what we now know to have taken place." Ms. Brooks said she would focus on “correcting the distortions and rebutting the allegations” and would cooperate with a police inquiry into phone hacking and payments to corrupt police officers. Since January, nine people have been arrested in that probe, including Andy Coulson, a former close associate of Ms. Brooks and once a senior aide to Prime Minister Cameron. She also praised Mr. Murdoch’s “wisdom, kindness and incisive advice” and his son James’s “great loyalty and friendship.” “I have worked here for 22 years and I know it to be part of the finest media company in the world,” she said. After she quit, James Murdoch praised her as “one of the outstanding editors of her generation.” “The company has made mistakes,” he said in a message to News International staff quoted by the Press Association news agency. “It is not only receiving appropriate scrutiny, but is also responding to unfair attacks by setting the record straight.” Her resignation came a day after Rupert Murdoch made his first extended comments on the matter, phoning a reporter at The Wall Street Journal to defend his company’s handling of the crisis. He said the matter had been handled “extremely well in every way possible,” and rejected claims that his son James had moved too slowly to address concerns about the hacking. He added that he was eager “to address some of the things that have been said in Parliament, some of which are total lies,” and said reports that the News Corporation was contemplating spinning off its newspapers into a separate entity were “pure rubbish.” The company’s woes increased on Thursday when yet another former senior editor of The News of the World, now defunct, Neil Wallis, became the ninth person since January to be arrested in the phone-hacking scandal. Mr. Wallis also appears to have unusually close ties to top officers at the Metropolitan Police Service, and worked for them as a public relations consultant last year. John F. Burns reported from London and Alan Cowell from Paris. Reporting was contributed by Ravi Somaiya from London.

Rebekah Brooks FINALLY quits over phone-hacking scandal as Murdoch's daughter 'accuses her of f****** the company' • David Cameron says her resignation was the right decision • Second biggest shareholder said last night that 'she must go' • MP Chris Bryant says she should have gone sooner • James Murdoch to come under the spotlight after Brooks departure • News International will apologise in ALL national newspapers this weekend • Brooks to be replaced by Sky Italia chief exec, Tom Mockridge By Richard Hartley-parkinson Daily Mail Last updated at 4:19 PM on 15th July 2011 http://www.dailymail.co.uk/news/article-2015067/Rebekah-Brooks-resigns-head-News-International-refuses-apologise.html# Rebekah Brooks has finally resigned as chief executive of News International a day after it was alleged that Elisabeth Murdoch said Brooks had 'f***** the company'. The decision to step down came amid deafening calls for her to quit by the likes of David Cameron, Ed Miliband and senior figures within News Corporation. In an internal email to staff she announced she was standing down saying: 'I feel a deep sense of responsibility for the people we have hurt. 'I now need to concentrate on correcting the distortions and rebutting the allegations about my record as a journalist.' News Corp announced that the 43-year-old is to be replaced by Tom Mockridge, 55, chief executive of Sky Italia. Pressure was mounting on her to quit after Rupert Murdoch's daughter's comments which came at the same time that the second biggest shareholder at News Corp declared that she 'must go'. Scroll down to read Rebekah Brooks's statement in full Furious: Elisabeth Murdoch, left, launched a scathing attack on Rebekah Brook's handling of the phone hacking crisis in which she said the former editor had 'f***** the company' Former friends: In 2008 Rebekah Brooks and Elisabeth Murdoch remained friends, pictured here at a lunch for women in business at 10 Downing Street Rupert Murdoch set off for work today with his son, Lachlan, moments after news broke that Brooks had quit CALLS FOR HEAD OF PCC TO QUIT Lord Myners today said that Baroness Buscombe should stand down as chairman of the Press Complaints Commission. He called on her to quit as head of the industry's self-regulator after the body failed to fully investigate phone hacking allegations at the News of the World. Speaking in a House of Lords debate on News Corporation's role in the British media landscape, he said: 'It's quite clear the PCC needs a completely fresh start with a new vigour and intention which is clearly not there.' Lord Myners spoke out after Conservative peer Baroness Buscombe, who has led the PCC since April 2009, briefly appeared in the chamber during today's debate. He said: 'I was going to say I was sad Baroness Buscombe was not in her place. She then appeared and she has now again departed. 'I think she might follow that same chain of events in terms of her chairmanship of the PCC.' The Labour peer said he 'felt' for Baroness Buscombe as she was grilled during a television interview, but added: 'It was quite clear the PCC has become an apologist for the newspaper industry rather than a vibrant and independent body performing the role we would expect. 'I am afraid Baroness Buscombe must fall on her sword if the PCC is to be given a fresh start.' Miss Murdoch, 42, is understood to be 'furious' that her father's media empire has been thrown into the spotlight over the last fortnight. Had Brooks resigned last week, there is speculation that the News of the World could have been saved and media commentators suggested that the paper was sacrificed for her. Miss Murdoch 'railed' against the former News of the World editor and made her scathing remarks to friends, it was alleged by the Daily Telegraph. The rhetoric of Miss Murdoch's comments shows just how their friendship has dissolved over the years. In 2001 the pair were photographed on Miss Murdoch's hen night during which the group of friends was being followed in their white stretch-limo by a Ford Mondeo. Brooks, then Rebekah Wade and editor of the News of the World, called the picture desk and, using the car's number plate, was able to identify the paparazzo driver. She called him, identified herself and said that unless he stopped following them she'd see to it that no Murdoch publication would do business with him again. The Mondeo immediately performed a U-turn and disappeared. In a debate in the House of Lords today, Lord Prescott ridiculed Brooks's claim that her 'desire to remain on the bridge had made me a focal point of the debate. 'I was a seafarer of 10 years, I wouldn't have liked her on the bridge if she didn't know what was going on or where she was going and what direction, and that is why she has gone,' he said. Elisabeth Murdoch, far left, invited Brooks, third from left and then editor of NotW, to join her on her hen night He added: 'All these others are small bit players, it's Mr Murdoch (senior), he is the spy in the middle of this net and if we don't deal with him he will just come back to the same old practices.' Seafarer: John Prescott ridiculed the notion that Brooks had a 'desire to remain on the bridge' during the crisis A close aide of Lord Prescott suggested that what he was trying to say was 'spider in the middle of this web'. The Murdochs have presented a united front in public but behind closed doors there were growing ructions, according to the Daily Telegraph. Murdoch, 80, was pictured smiling as he left a restaurant in central London with his arm round Brooks following an hour-long meeting at his luxury flat last weekend. When asked what his top priority was, Murdoch gestured at Brooks and said: 'This one'. Saudi Prince Al-waleed bin Talal, who holds seven per cent shares in News Corp, made his position clear that she should leave. 'For sure she has to go,' he told BBC's Newsnight 'you bet she has to go.' Speaking on his luxury yacht, the billionaire - known as the 'Arab Warren Buffet'- added: 'We hope that as this things unfolds the truth will come out.' 'It's very important to me and my company who have been investors in News Corp for 20 years to get this in order because ethics to me are very important' he said. Asked about hacking into Milly Dowler's phone, Alsaud said he wanted to differentiate between the News of the World and News Corporation as a whole. 'I think we have to wait for the commission that's been appointed by the Prime Minister and look at the results,' he added in response to allegations that James Murdoch had known about illegal activity. When asked about alleged hacking of Milly Dowler's phone, Prince Waleed Alsaud, left, said he wanted to differentiate between the News of the World and News Corporation as a whole Alsaud, who could lose hundreds of millions if News Corporation's stock market value crashes even more, said that the scandal should not be 'over-criticised'. Rupert Murdoch launched an astonishing defence of News International's handling of the crisis saying that the company had only made 'minor mistakes'. He could have prevented the phone-hacking scandal by taking editorial control over his newspapers, the House of Lords was told today. Lord Fowler told the House of Commons today that if Murdoch had more editorial control the scandal may not have arisen Former Conservative Party chairman Lord Fowler said the News Corp boss disagreed with celebrity coverage in the Sun and News of the World, which ultimately led to journalists hacking into voicemails. Opening a debate on News International's position in the UK media landscape today, Lord Fowler recalled the Lords communications committee interviewing Mr Murdoch in New York four years ago. Lord Fowler said: 'He did not exercise daily editorial control. He said if he had, there wouldn't be the degree of celebrity 'gunge' there was in his tabloids. 'He added that he didn't understand the interest in Big Brother contestants and, by implication, their private lives. 'That, he said, was up to his editors. I think today he might be rather regretting that hands-off approach as his empire shows signs of cracking. 'What has brought it low has been the preoccupation with private lives and private tragedies and the totally unacceptable means one of his newspapers, the News of the World, used to avoid the law.' Today's debate was delayed by five minutes because few peers were in the chamber ready to start after earlier business finished ahead of schedule. Lord Prescott, a leading critic of Mr Murdoch's regime, was giving an interview to Sky News and arrived late for the start of proceedings. The under-pressure tycoon dismissed Gordon Brown's claims that the Murdoch empire was 'part of a criminal underworld' as 'lies'. A worker leaves News International's headquarters in Wapping earlier today Rupert Murdoch accepted Rebekah Brooks' resignation today. He has twice previously turned down her offer to quit HOW THE PHONE HACKING SCANDAL UNFOLDED July 4: Claims emerge that Milly Dowler's phone was hacked July 5: Brooks says she is 'appalled and shocked' at allegations. Ford pulls out of NotW July 6: London bombings families warned they may have been hacked. Brooks gets Murdoch's backing. July 7: James Murdoch announces closure of NotW as Scotland Yard identifies 4,000 potential victims July 8: Andy Coulson, Clive Goodman and unnamed man, 63 arrested. Cameron urges Brooks to quit. July 10: Last edition of NotW. Murdoch lands to take control of crisis. July 11: It is revealed that protection officers were paid £1,000 for contact numbers of senior royals. July 12: Labour and Lib Dems call for Muroch to drop BSkyB bid. MPs accuse Met Police officers of incompetence. July 13: News Corp withdraws BSkyB bid. July 14: Rupert and James Murdoch agree to give evidence to MPs. Ex-editor Neil Wallis is arrested. July 15: Brooks quits as chief executive of News International In his first interview since the hacking crisis exploded, Murdoch caused further insult to hacking victims as he shrugged off the scandal saying he was 'tired' and will 'get over it'. In the Wall Street Journal he said the claims of breaking the law on an industrial scale were 'nothing that will not be recovered' adding that he has a reputation for 'good works'. David Cameron's spokesman today said that the Prime Minister believes her resignation was the 'right decision'. A spokesman for the Deputy Prime Minister said: 'This is the right thing for Rebekah Brooks to have done. It is an important first step in cleaning up this mess. 'People will, rightly, expect Mrs Brooks to come to the Select Committee next week to give evidence. 'People still need answers. She owes it to the victims of phone hacking and the country at large to explain her role in what happened.' Yesterday Neil Wallis, a former executive editor at News of the World, was arrested and later bailed over phone hacking allegations. His alleged involvement in the crisis is a further embarrassment for Scotland Yard as it turned out the 60-year-old was paid £1,000-a-day as a consultant between October 2009 and September 2010. As a result head of the Yard, Sir Paul Stephenson, also faces being dragged before MPs to explain himself and his relationship with Wallis. Commissioner of the Met Police Sir Paul Stephenson, left, did not inform the Prime Minister that Neil Wallis had been employed by Scotland Yard between October 2009 and September 2010 Brooks will appear before the Home Affairs Select committee next week to answer questions from MPs led by chairman Keith Vaz.. WHO IS TOM MOCKRIDGE? A key lieutenant of Rupert Murdoch, the 55-year-old New Zealander was chief executive of Sky Italy since its creation in April 2003. He moved to Australia in 1980 where he worked for the Sydney Morning Herald newspaper then between 1984 and 1991, he was a member of Australian Finance Minister Paul Keating's staff. In 1991, he joined News Corp in Sydney as assistant to Ken Cowley, chief executive of Australian subsidiary News Ltd. In 1997, he became chief executive of Foxtel, a pay-TV company that News Corp owned through a joint venture with Australian telecommunications company Telstra. In 2001, he was appointed managing director of Independent Newspapers Ltd, the largest publisher of newspapers and magazines from New Zealand headed by News Corp. He was also president of Sky New Zealand, the pay-TV group in the country. In 2002, Mockridge led the merger between Stream and Telepiu, which brought about Sky Italy. In 2010, a war between Sky Italia and Mediaset, Italy's largest private broadcaster, erupted when Mockridge called for the removal of 2003 legislation preventing Sky from entering the terrestrial television market. The European Union ruled in July 2010 in Sky's favour, a position upheld by Italy's top administrative court last February. British pay-TV broadcaster BSkyB appointed Mockridge as a non-executive director in 2009. and he had been promoted to the additional role of chief executive of European television for News Corp in 2008. Earlier today he said he was surprised she had resigned despite the fact that she has twice before offered her resignation to Rupert and James Murdoch. He also said it was important that News International continued to cooperate with the investigation into phone hacking in the wake of her resignation 'We must make sure that the resignation does not mean that there is not that continued cooperation,' he told Sky News. 'We need to still get to the bottom of matters.' Upon hearing the news that she had resigned, Mark Lewis, the lawyer of Milly Dowler's family, said: 'She should have resigned when Andy Coulson resigned.' He added: 'News International, News of the World, had ruined people's lives. 'In a sense it is the chicken coming home to roost. It is time. Every dog has its day and Rebekah Brooks, I suppose, is that dog.' A spokesman for the Hacked Off Campaign, which is lobbying for a full investigation into phone hacking, welcomed Mrs Brooks's resignation but said it was more important for the full truth about the scandal to be uncovered. He said: 'The Hacked Off Campaign's main focus is on getting an inquiry with the right scope, powers and timescale to get to the truth, but all the victims we have spoken to have told us that they cannot see how Rebekah Brooks could remain in her job, given what has so far been revealed. 'The key issue is not, however, whether Rebekah Brooks is in work, but whether she lied to Parliament, told the full truth to the police or was engaged in a massive cover-up. That is what the victims want to know.' James Murdoch issued a statement after her resignation saying: 'I understand her decision and I want to thank her for her 22 years of service to the Company. 'She has been one of the outstanding editors of her generation and she can be proud of many accomplishments as an executive.' Mr Murdoch announced that apologies will appear in all national newspaper this weekend over phone hacking. Replacement: Tom Mockridge will take over as chief executive of News International James Murdoch today said that the company had made mistakes and would be apologising in all national newspapers this weekend REBEKAH BROOKS' RESIGNATION LETTER IN FULL Rebekah Brooks, pictured in 2001 while editor of News of the World, admitted that News International is leading the news for the wrong reasons At News International we pride ourselves on setting the news agenda for the right reasons. Today we are leading the news for the wrong ones. The reputation of the company we love so much, as well as the press freedoms we value so highly, are all at risk. As Chief Executive of the company, I feel a deep sense of responsibility for the people we have hurt and I want to reiterate how sorry I am for what we now know to have taken place. I have believed that the right and responsible action has been to lead us through the heat of the crisis. However my desire to remain on the bridge has made me a focal point of the debate. This is now detracting attention from all our honest endeavours to fix the problems of the past. Therefore I have given Rupert and James Murdoch my resignation. While it has been a subject of discussion, this time my resignation has been accepted. Rupert’s wisdom, kindness and incisive advice has guided me throughout my career and James is an inspirational leader who has shown me great loyalty and friendship. I would like to thank them both for their support. I have worked here for 22 years and I know it to be part of the finest media company in the world. News International is full of talented, professional and honourable people. I am proud to have been part of the team and lucky to know so many brilliant journalists and media executives. I leave with the happiest of memories and an abundance of friends. As you can imagine recent times have been tough. I now need to concentrate on correcting the distortions and rebutting the allegations about my record as a journalist, an editor and executive. My resignation makes it possible for me to have the freedom and the time to give my full cooperation to all the current and future inquiries, the police investigations and the CMS appearance. I am so grateful for all the messages of support. I have nothing but overwhelming respect for you and our millions of readers. I wish every one of you all the best. Rebekah Mr Murdoch also said that the company will try to rebuild bridges with advertisers, announcing that News Corp would be 'sending letters to our commercial partners with an update on the actions we are taking'. GUARDIAN APOLOGISES OVER GORDON BROWN STORY The Guardian newspaper today apologised for reporting that the Sun newspaper had obtained information about Gordon Brown's son from medical records. The newspaper printed a single paragraph apology on page 36. 'In fact the information came from a different source and the Guardian apologises for its error,' it said. Its apology came after a front page story on Tuesday claiming that the Sun discovered that Fraser Brown had been diagnosed with cystic fibrosis by accessing medical records in 2006, when Brown was chancellor. Brown was 'in tears' when he found out the Sun was going to run the story about his child, he told the BBC in an interview on Tuesday. The Sun denied any wrongdoing and said the information came from a member of the public whose son also suffers from cystic fibrosis, who wanted to raise awareness of the condition. The newspaper said the unidentified man has signed an affidavit to confirm he was the source of the story. He added: 'Next week, my father and I will appear before the (Culture Media and Sport) Select Committee and will speak to them directly about our determination to put things right. 'The Company has made mistakes. It is not only receiving appropriate scrutiny, but is also responding to unfair attacks by setting the record straight. 'I would like to conclude by saying thank you. Throughout this time, you have gotten out great papers every day and have stayed focused. I am deeply grateful for that.' Murdoch's leadership is now likely to come under close scrutiny as the spotlight shifts onto him instead of Brooks. Labour MP Tom Watson, member of the Culture, Media and Sports Committee said he had 'questions to answer' about why he authorised payments to hacking victims. 'The focus of attention will be on him and his corporate leadership of the company,' he told the BBC. Mr Watson, who has campaigned on phone hacking for the last two years, said he expected the Murdochs and Mrs Brooks to give a series of 'non-answers' when they appeared before the committee next Tuesday. 'None of this pleases me, it is a deeply unpleasant scandal,' he added. Mr Watson also urged Prime Minister David Cameron to 'co-operate fully' with the FBI investigation if it turned out 9/11 victims had been hacked. Labour frontbencher Chris Bryant, who has been a leading critic over the phone-hacking scandal, said Mrs Brooks should have left before. MP Tom Watson said that the spotlight is likely to shift onto James Murdoch now that Brooks has gone 'I think it is right that she goes. I think she should have gone a very long time ago,' he told Sky News. 'Frankly, she should have gone when she said she had paid police officers for information back in 2003.' He added: 'I thought it was disgraceful when the newspaper last week was closed as a way of trying to protect Rebekah Brooks and then Mr Murdoch saying that she was his priority. 'It felt like those in the boiler room were carrying the can for those who were really at the helm of the ship.' Ed Miliband said on hearing the news: 'It is right that Rebekah Brooks has resigned. No one should exercise power without responsibility. 'It's right Rebekah Brooks has finally taken responsibility and resigned. Mr Murdoch still hasn't apologised to the victims of phone hacking.' Chairman of the Commons Culture, Media and Sport Committee John Whittingdale said he believed her resignation had been 'inevitable'. 'I think this is the right decision. I think many people expected it to come rather sooner, but I think her position was extremely difficult,' he told Sky News. 'I think the most shocking revelation of all, perhaps, was the hacking of Milly Dowler's phone, which took place when she [Mrs Brooks] was the editor of the paper and there has obviously been a stream of revelations since then. 'This was inevitable and it is the right thing.' JAMES MURDOCH'S STATEMENT IN FULL James Murdoch arrived at News International HQ this morning as Rebekah Brooks announced she was standing down I am writing to update you on the actions we have been taking as a company to solve the problems at News International relating to the News of the World, in addition to continuing to co-operate fully and actively with the police and settling civil claims. Earlier today, Rebekah Brooks resigned from her position as CEO. I understand her decision and I want to thank her for her 22 years of service to the company. She has been one of the outstanding editors of her generation and she can be proud of many accomplishments as an executive. We support her as she takes this step to clear her name. We have created an independent management and standards committee and I want to emphasise its importance. The committee has direct governance and oversight from News Corporation board members and is codifying standards that will be clear and enforced. We made the difficult and necessary decision to close the News of the World. A number of other executives have now left the company. News Corporation also withdrew its proposal to acquire the shares in BSkyB it does not own. This is a strong signal that our top priority in the UK is to address the issues facing News International. Looking to the future, I am also pleased to tell you that Tom Mockridge will become CEO of News International. Tom is in London today and will start right away. Tom is a highly respected and accomplished media executive who has served as CEO of Sky Italia since its launch in 2003. Tom, who has also been in charge of our European television business, started his career as a newspaper journalist in New Zealand and he has held a range of top roles in the newspaper industry. The creation of TG-24, Italy's only truly independent 24 hours news channel, is a credit to Tom's leadership and integrity. This weekend, News International will run advertisements in all national newspapers. We will apologise to the nation for what has happened. We will follow this up in the future with communications about the actions we have taken to address the wrongdoing that occurred. We are also sending letters to our commercial partners with an update on the actions we are taking. Next week, my father and I will appear before the CMS [culture, media and sport] select committee and will speak to them directly about our determination to put things right. The company has made mistakes. It is not only receiving appropriate scrutiny, but is also responding to unfair attacks by setting the record straight. I would like to conclude by saying thank you. Throughout this time, you have gotten out great papers every day and have stayed focused. I am deeply grateful for that.

FBI to investigate News Corporation over 9/11 hacking allegations Bureau to investigate claims News of the World journalists sought to hack into phone of victims of 9/11, reports say By Ed Pilkington in New York, Andrew Gumbel and agencies guardian.co.uk, Thursday 14 July 2011 23.43 BST The FBI has opened an investigation into allegations that News of the World journalists tried to hack into the phones of victims of the 9/11 attacks in New York. The launch of the FBI inquiry amounts to the first official inquiry within the US into News Corporation activities. The move brings the scandal within Rupert Murdoch's British newspaper division closer to his American home and to News Corporation's headquarters in Manhattan. The announcement of an FBI inquiry followed a mounting chorus from politicians and relatives of 9/11 victims calling for a review of the allegations. Peter King, the Republican chairman of the homeland security committee in the House of Representatives, on Wednesday wrote to the director of the FBI, Robert Mueller, and asked him to open an investigation into the 9/11 allegations. In his letter, King said he represented a district of New York that lost more than 150 constituents in the terror attacks. "If these allegations are proven true, the conduct would merit felony charges, and any person found guilty should receive the harshest sanctions available under law." The claim that Murdoch journalists attempted to get hold of victims' phone details was made by the Mirror newspaper, which based the story on an unnamed former New York police officer working as a private detective, who was said to have been approached by News of the World reporters asking him to retrieve the private phone records of the dead. The detective was reported to have declined to take up the commission. It is unclear at this early stage in the investigation whether there is any substance to the Mirror's allegations. But relatives of 9/11 victims expressed delight and relief that the FBI had stepped in to clear up the issue. Sally Regenhard, whose firefighter son Christian died in the World Trade Centre, said: "I'm very happy. The FBI is being very responsive in acting on our call for a full investigation." Jim McCaffrey, a New York firefighter who lost his brother-in-law Orio Palmer, also a firefighter, on 9/11, also welcomed the FBI inquiry. "If these claims are found to be true, I think it's a terrible revelation and very, very upsetting to 9/11 family members," he said. Even if the information contained in the Mirror article could be verified, there might be a problem with moving forward with an investigation because the events were so long ago. Several legal experts, including a former top lawyer for the FBI, said that prosecution under federal wiretapping laws is subject to a five-year statute of limitations. While the FBI inquiry gets under way, News Corporation also faces the prospect of possible prosecution under other US laws. Several Congress members have called for the company to be held accountable under the Foreign Corrupt Practices Act, a federal law that punishes firms based in the US that engage in bribery abroad. It has emerged that News of the World staff paid police officers in the UK in the course of their phone-hacking activities.

Arrested News of the World executive was employed as Met adviser Neil Wallis, who has been questioned over phone hacking, advised commissioner on communications, Scotland Yard says By Vikram Dodd, crime correspondent guardian.co.uk, Thursday 14 July 2011 17.21 BST Scotland Yard has admitted it employed Neil Wallis, a former executive at the News of the World, as an adviser to the commissioner until September 2010. Wallis was employed to advise Sir Paul Stephenson and John Yates on a part-time basis from October 2009 to September 2010. During this time the Yard was saying there was no need to reopen the phone-hacking investigation – a decision made by Yates despite allegations in the Guardian that the first police investigation had been inadequate. Wallis is a former News of the World executive editor. He was arrested on Thursday morning as part of the police's renewed phone-hacking inquiry. Neil Wallis Wallis joined the News of the World in 2003 as deputy to then editor Andy Coulson. In mid-2007 he became executive editor, eventually leaving the News International title in 2009. Police say he supplied "strategic communication advice". The Met said his company was chosen because it offered to do the work for the lowest price. He was paid £24,000 by Scotland Yard to work as a two-day-a-month consultant. Relations between senior Met officers and News of the World senior executives have been under scrutiny. In September 2006 Stephenson, as deputy commissioner, accompanied by the Yard's head PR man, Dick Fedorcio, dined with Wallis. This was a month after officers had arrested the paper's royal correspondent, Clive Goodman, and at a time when detectives were still attempting to investigate whether other journalists or executives were involved in the interception of voicemail messages. In theory Wallis was a potential suspect in the inquiry. Scotland Yard said: "Chamy Media, owned by Neil Wallis, former executive editor of the News of the World, was appointed to provide strategic communication advice and support to the MPS, including advice on speechwriting and PR activity, while the Met's deputy director of public affairs was on extended sick leave recovering from a serious illness. "In line with Metropolitan Police Service/Metropolitan Police Authority procurement procedures, three relevant companies were invited to provide costings for this service on the basis of two days per month. Chamy Media were appointed as they were significantly cheaper than the others. The contract ran from October 2009 until September 2010, when it was terminated by mutual consent. "The commissioner has made the chair of the police authority aware of this contract."

News Corp. Newspapers May Face U.S. Inquiry The New York Times By BRIAN STELTER July 14, 2011 Public criticism of the News Corporation’s conduct in the British hacking scandal has crossed the ocean as half a dozen members of Congress this week urged the United States government to investigate possible misconduct, including violations of a law that guards against foreign corruption. In a letter on Wednesday, Representative Peter T. King, Republican of New York, pressed the F.B.I. to investigate whether journalists working for News Corporation newspapers tried to obtain phone records of victims of the Sept. 11, 2001, terrorist attacks, as one British newspaper claimed, citing anonymous sources. Mr. King was the first Republican to call for an investigation into the company’s activities. The News Corporation’s chief executive, Rupert Murdoch, is a longtime supporter of conservative causes and Republican politicians. Several of the other lawmakers who spoke out this week have been publicly critical of the News Corporation in the past. The first to issue a statement, Senator John D. Rockefeller IV, Democrat of West Virginia, said Tuesday that the United States government should hold investigations to “ensure that Americans have not had their privacy violated.” He was joined on Wednesday by senators like Robert Menendez, Democrat of New Jersey, who asked the Justice Department to investigate the claims involving 9/11 victims. Mr. Menendez said in his letter that the “large scope” of the hacking in Britain made it “imperative to investigate whether victims in the United States have been affected as well.” New Jersey’s other senator, Frank R. Lautenberg, suggested Wednesday that both the Justice Department and the Securities and Exchange Commission should examine the case and consider starting a formal investigation. Mr. Lautenberg referred to news media reports that journalists “paid London police officers for information, including private telephone information, about the British royal family and other individuals for use in newspaper articles.” Because the News Corporation is based in the United States, such payments may have violated the Foreign Corrupt Practices Act, which forbids payments to foreign officials. Citing the act’s accounting rules, he added, “If indeed bribes were made and were not properly recorded, this too may be a violation of law.” Several of the lawmakers echoed what Mr. Lautenberg asserted: that “further investigation may reveal that current reports only scratch the surface of the problem at News Corporation.” Asked about Mr. Lautenberg’s letter, Mary Schapiro, the chairwoman of the S.E.C., said, “We will look at it very carefully, as we do all Congressional correspondence.” A Justice Department spokeswoman said the letters to that agency were being reviewed. Several civic and public interest groups, including some that have been longtime opponents of the News Corporation and Mr. Murdoch, have set up petitions and proposed Congressional hearings into the company’s conduct. The executive director of Citizens for Responsibility and Ethics in Washington, Melanie Sloan, said Wednesday, “Just as the British Parliament has held hearings and heard the testimony of witnesses, Congress has the ability to subpoena News Corporation employees and require them to explain themselves.”

Steve Richards: Now we know who runs the country We need to know a lot more about the activities of bankers, business leaders, civil servants, police, and the media The Independent Thursday, 14 July 2011 The dramatic and yet inevitable withdrawal of Rupert Murdoch's bid for BSkyB serves as a vivid symbol of giddy decline, a collapse from swaggering omnipotence to breathless fragility in less than a fortnight. Suddenly there is a mountain of inquiries and investigations into the activities of the media, the police and politicians. Until recently only a few were bravely and passionately interested in the implications of News International and the hacking allegations. Now one media empire is besieged and others must be wondering whether they too will attract unwelcome attention. Perhaps more staggering revelations are to come, but the essential contours of the scandal are clear. Power in Britain is distributed widely and erratically. Yet on the whole we report and scrutinise decisions, events and public personalities on the assumption that most power is concentrated in the hands of politicians in general and ministers in particular. Around the clock, politicians are held to account, even though most of them wield virtually no power at all. If anything happens anywhere, the instinct of the media and the gladiatorial parliamentary culture is to hold the Government to account almost alone. Weak-kneed elected politicians feel compelled to respond. This dynamic reached a neurotically extreme point during Tony Blair's premiership when he felt obliged to issue a statement expressing concern about a fictional character in Coronation Street. Whatever is wrong with our political system, politicians are kept on their toes, accountable to the media, parliamentary committees and, of course, the electorate that can kick them out. This form of robust accountability is largely healthy. To reverse the proposition and argue that elected figures should not be held to account would be deranged. But the consequence of an excessive focus on mainly insecure, scared politicians has led to a distorting lack of accountability in relation to non-elected institutions that wield power with anonymous, and often unjustified, self-confidence. Few voters had heard of the senior bankers who were leading them to the edge of the precipice until it was almost too late. And yet the likes of Sir Fred Goodwin, who steered Royal Bank of Scotland towards catastrophe, had far more power than most elected ministers who were regularly attacked on the front pages and summoned to explain their timid, powerless behaviour at 8.10 am on the Today programme. Similarly, only now is more intense scrutiny being applied to the activities of the Metropolitan Police and the quality of some of its senior staff. The accountability of the police is highly sensitive and complex, but some senior figures in the Metropolitan Police have sheltered under convoluted lines of scrutiny. Both the Mayor of London and the Home Office have theoretical powers, while police retain operational independence. In fairness, the head of the Metropolitan Police is a public figure and extensively scrutinised, but it was alarming to watch the Home Affairs Committee interview a former assistant commissioner, Andy Hayman, and a current holder of that rank, John Yates. How did such cocky mediocrities rise to senior posts, ones that gave them responsibilities for handling the threat of terrorism? No elected minister would get so far up the Cabinet in the way that unimpressive duo rose up the hierarchy of the police. The media and parliamentary scrutiny would have exposed their different flaws long ago. Yates wields more power than most ministers, and Hayman used to. Some media organisations, but most specifically Rupert Murdoch's, have become the most extreme example of this trend towards unaccountable power. Murdoch rarely gives interviews. We have not heard from Rebekah Brooks since the latest revelations. According to the police officers interviewed by the Home Affairs Select Committee, News International failed to co-operate with their original inquiry, an inadequate excuse for giving up the investigation, but nonetheless the most damning of allegations. Here was a company that evidently thought it was powerful enough to get away with it, able to block police inquiries and to pay off victims of crime. One of the most revealing episodes in this damning sequence relates to the recent payment by News International to victims of hacking, including Gordon Taylor from the Professional Footballers' Association and the actress Sienna Miller. The payouts were public knowledge and yet few did very much in response. In some respects this tolerance was more shocking than the appalling revelations about Milly Dowler's phone. It took an emotionally charged trigger to challenge the might of an empire that owns around 40 per cent of newspapers and until yesterday afternoon sought to become an even bigger broadcaster. Until the terrible twist in relation to Milly Dowler, no senior frontbencher dared to make a move, and it took immense courage from the Labour MPs Tom Watson and Chris Bryant to lead their previously lonely campaign. A non-elected, largely unaccountable company acted loftily, while relatively obscure ministers with much less power are sometimes forced to resign for minor misdemeanours or no misdemeanour at all, quite often at the screaming insistence of newspapers owned by News International. Cameron was in authoritative form in the Commons yesterday afternoon, conveying a sense of grip, even if no one is, in reality, gripping very much at all. It is a mistake to view this crisis through the prism of the immediate political fortunes of Cameron or Ed Miliband. While it is true that Miliband read the scale of the saga with astute perception and acted on it with flair, I doubt if voters view the fast-moving events in terms of the party leaders, but more with an exasperated, impotent horror. The longer-term political prize is much bigger than one determined by which leader performs well in response to each volcanic eruption. I do not have great hope that the inquiry announced yesterday will deliver the prize. Its remit is wide and unavoidably abstract. To take one example of the difficulties when we move from the vague to the particular, Cameron stated yesterday that he supported "independent" regulation of the newspapers rather than self-regulation. When asked to explain the difference, he could not do so. I have spoken at many meetings where the relationship between the media and politics is the theme. The meetings go around in circles and always promise more than they deliver. This may be the fate of the inquiry. But deeper currents move fast. Belatedly, a strange sort of enforced accountability is taking place as parliament reasserts its right to stand up to non-elected institutions that function in the dark. Some commentators suggest that this is a sinister development, possibly leading to excessive political interference. Such fears are unfounded. How can it be sinister when those we elect challenge lawbreaking by a non-elected organisation? There is instead the prospect of a healthy re-balancing brought about partly by some brilliant and persistent investigative journalism. The many investigations will bring a form of catharsis, but the practical remedies are available for application now. If the media or the police break the law, they should not be allowed to get away with the crimes. Ownership must be limited, so that no single organisation holds excessive sway. The media and other institutions must scrutinise more robustly those in power beyond Whitehall or Parliament. We need to know a lot more about the activities of bankers, powerful business leaders, senior civil servants, police and, of course, what is happening behind the closed doors of media empires. This is a story about who runs Britain, and as light is shone we discover horrors. The light must not fade again. s.richards@independent.co.uk; twitter.com/steverichards14

Former Wall St Journal owners: 'We wouldn't have sold if we had known' Bancroft family members, who controlled Dow Jones & Company, say they would have resisted Murdoch bid in 2007 By Richard Tofel, ProPublica guardian.co.uk, Wednesday 13 July 2011 20.31 BST A number of key members of the family that controlled the Wall Street Journal say they would not have agreed to sell the prestigious daily to Rupert Murdoch if they had been aware of News International's conduct in the phone-hacking scandal at the time of the deal. "If I had known what I know now, I would have pushed harder against" the Murdoch bid, said Christopher Bancroft, a member of the family that controlled Dow Jones & Company, publishers of the Wall Street Journal. Bancroft said the breadth of allegations now on the public record "would have been more problematic for me. I probably would have held out.'' He had sole voting control of a trust that represented 13% of Dow Jones shares in 2007 and served on the Dow Jones board. Lisa Steele, another family member on the board, said "it would have been harder, if not impossible'' to have accepted Murdoch's bid had the facts been known. "It's complicated," she added, and "there were so many factors" in weighing a sale. But she said: "The ethics are clear to me – what's been revealed, from what I've read in the Journal, is terrible. It may even be criminal." Elisabeth Goth Chelberg, a Bancroft family member not on the board who had long advocated change at Dow Jones, expressed similar sentiments. Asked if she would have favoured a sale to Murdoch in 2007 knowing what she now does, she said: "My answer is no." The comments in interviews with the non-profit news organisation ProPublica came as the crisis engulfing Murdoch's News Corporation threatened to spread to the US. Two senators called for an investigation into whether the company broke US laws over the phone-hacking scandal. Asked for his reaction to a report in the Guardian that Les Hinton, Murdoch's appointee as Dow Jones CEO and Journal publisher, may have testified untruthfully to a parliamentary committee, Christopher Bancroft replied that if the report proved accurate, Hinton "probably ought to be moved aside, but that's not my business any more''. News Corporation's deal to buy the Journal was sealed in August 2007, six months after the royal editor of the News of the World, Clive Goodman, was jailed for using a private detective to access voicemails left for members of the royal household. News International insisted that hacking was a problem confined to a single "rogue reporter" at the paper. It was not until July 2009 that the Guardian revealed the practice was more widespread and that Murdoch had secretly paid out more than £1m to settle cases brought by other hacking victims. The Wall Street Journal is the top-selling daily newspaper in the United States and a brand with global prominence. Founded in 1889, it long dominated American business publishing, becoming the country's first national newspaper. It routinely ranked in surveys as America's most trusted print publication. The Bancroft family owned Dow Jones from 1902 and controlled it as a publicly traded company from 1963. Murdoch's bid was attractive. He offered $60 a share, a 67% premium, $2.25bn above the market price the day his offer was announced, at a time when newspaper share prices had been flagging for more than two years. Moreover, 14 months after the deal closed, in early 2009, News Corp had to write down the value of its $5.6bn purchase by $2.8bn. The sale was contentious. Family members questioned Murdoch's journalistic practices and insisted on appointment of an independent panel to help safeguard the paper's ethics. There was negative press in the US about Murdoch at the time of the deal in 2007, although nothing to compare with the recent revelations. Michael Elefante, a partner at the Boston law firm Hemenway & Barnes, longtime counsel to the family, trustee of numerous trusts and also then a member of the Dow Jones board, did not return messages seeking comment. The fourth family representative on the Dow Jones Board, Leslie Hill, consistently opposed the Murdoch bid, and resigned from the board in protest just before the deal was completed. (Hill has been a donor to ProPublica.) Not all members of the Bancroft family believe the revelations would have changed the outcome. Bill Cox III, long allied with Chelberg within the family in seeking alternatives to management by Dow Jones, said in an interview that he "probably would have thought twice about it but probably would have sold". He was "happy about the price we got" for Dow Jones. "I'm pretty happy being out of the newspaper business altogether." Asked if he would have accepted a lower price from another bidder given the phone hacking, he said: "I think $60 was the right price." Cox did say he had been following the story closely in the Australian media during a trip there and that he was very concerned about what he had learned recently about the Journal's new owners. "Reading all this makes me sick to my stomach," he said. In a subsequent email, he went even further: Rupert Murdoch, he wrote, "thinks he is completely above the law as he always has." Cox added: "We did a deal with the devil and it really saddens me [that] the editorial of this quasi public trust that has been on the vanguard of world journalism for years is not in good hands. That I am really struggling with."The Bancroft family continues to keep an eye on the Journal and Dow Jones. Asked for his reaction to a report in the Guardian that Les Hinton, Murdoch's appointee as Dow Jones CEO and Journal publisher, may have testified untruthfully to a parliamentary committee, Christopher Bancroft replied that if the report proves accurate, Hinton "probably ought be moved aside, but that's not my business anymore.''

http://www.youtube.com/watch?feature=player_embedded&v=j5VO7fxupGo Keith Olbermann predicts that the entire Murdoch media empire will come crashing down as its criminal activities are revealed, including Fox News.

Phone hacking: pressure in United States to investigate News Corporation Exclusive: A powerful Senate committee chairman has said that phone hacking raises "serious questions" about whether Rupert Murdoch's News Corp "has broken United States law". Senator Jay Rockefeller is "concerned that the admitted phone hacking may have extended to 9/11 victims" The Telegraph By Toby Harnden, in Washington 10:15PM BST 12 Jul 2011 The statement by Senator Jay Rockefeller, a White House ally and Democratic chairman of the Senate Commerce, Science and Transportation Committee, dramatically raises the stakes for Mr Murdoch by signaling potential legal repercussions in America. "The reported hacking by News Corporation newspapers against a range of individuals - including children - is offensive and a serious breach of journalistic ethics," he said in a statement issued following inquiries by The Daily Telegraph. "This raises serious questions about whether the company has broken US law, and I encourage the appropriate agencies to investigate to ensure that Americans have not had their privacy violated. "I am concerned that the admitted phone hacking in London by the News Corp. may have extended to 9/11 victims or other Americans. If they did, the consequences will be severe." US ethics earlier on Tuesday called on the Senate and House of Representatives to investigate the parent company of News International and hold “thorough public hearings” on whether the voicemails of Americans had been hacked. One group has even written to the Security and Exchanges Commission (SEC) and the FBI calling for investigations into possible breaches of the Foreign Corrupt Practices Act (FCPA). Under the FCPA, it is a crime for any American-linked company to bribe foreign officials to obtain or keep business. Kevin Zeese, a lawyer acting for the group ProtectOurElections.org, said: “Rupert Murdoch moved to the US and became an American citizen in 1985 in order to take advantage of our laws.” Thus far, Congress is maintaining a watching brief on the issue and waiting for the tide of revelations in Britain to subside. “We’re keeping an eye on the situation, but are not planning on looking into it at this time,” said Jodi Seth, press secretary of Senator John Kerry, chairman of the Senate sub-committee on communications. “For now, all that is certain is that there was hacking in Britain, which is outside of our jurisdiction.” Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington (CREW), said that congressional investigations were essential because it was evident there was a culture of corruption within News Corp. “It’s hard to imagine that the same things have not been happening in the United States.” The tipping point, she added, would be if it became apparent that the phones of Americans had been hacked. “Republicans are very tied to Murdoch but not at the expense of constituencies of Americans such as terror victims and soldiers,” she said. She also noted that Les Hinton, the Dow Jones chief executive, and Robert Thomson, the Wall Street Journal editor, were former senior figures in News International. A former US government official said that the SEC, the federal regulatory agency that oversees the securities industry and stock exchanges, was very likely to look into whether News Corp had violated the FCPA. The alleged bribing of police officers protecting the Royal family and a claim by the Daily Mirror that News of the World reporters had also tried to pay a New York police officer to access the phone records of victims of the September 11 attacks could have repercussions on News Corp in the US. At a minimum, the company could be at risk for violating laws on accurate accounting or reporting if it could be proved there were bribes paid, according to legal experts. News Corp shares trade on the Nasdaq and it files its financial reports with the SEC. “It’s difficult for enforcement agencies not to look into cases that are so public because a big part of their role is deterrence,” said Alexandra Wrage, president of the firm Trace, which helps companies comply with anti-bribery and anti-corruption laws. Most of Mr Murdoch’s News Corp empire comprises Fox News, which has widespread reach particularly among conservatives, the Wall Street Journal, the New York Post and 20th Century Fox, the film studio. It also has 27 television stations that cover 40 per cent of the country and have to be licensed by the Federal Communications Commission. The licences can be challenged when they come up for renewal. Criminal convictions or making misrepresentations to any government agency could lead to licences being revoked

News Corp pulls out of BSkyB bidB SkyB bid dropped by Rupert Murdoch's media group after pressure from the public and parliament By James Robinson guardian.co.uk, Wednesday 13 July 2011 14.43 BST Rupert Murdoch's media group News Corporation bowed to pressure from the public and parliament on Wednesday and withdrew its bid to take full control of pay-TV company BSkyB. All three main political parties were poised to call on News Corp to abandon its offer in a vote in the House of Commons later on Wednesday. The move leaves News Corp's key strategy for UK corporate growth in tatters. The proposed £8bn deal has been in train for more than a year, with the first offer tabled in June 2010. It is the one of the biggest setbacks the 80-year-old media mogul has ever suffered and follows 10 days of revelations about the true scale of phone hacking at the News of the World, the paper Murdoch shut down last week. The decision to abandon the deal is also a major blow to James Murdoch, who is third in command at the company and has responsibility for News Corp's UK businesses, including its Sky stake and News International. It is likely to lead to criticism from investors over the way the company has handled the phone-hacking affair. James Murdoch initially took charge of the scandal but his father has twice flown in to the UK to oversee matters, most recently at the weekend. News Corp's deputy chairman and chief operating officer, Chase Carey, said it had become clear that the Sky takeover "is too difficult to progress in this climate". Carey, who is also News Corp's president, said: "We believed that the proposed acquisition of BSkyB by News Corporation would benefit both companies but it has become clear that it is too difficult to progress in this climate. "News Corporation remains a committed long-term shareholder in BSkyB. We are proud of the success it has achieved and our contribution to it." News Corp will have to pay BSkyB a break fee of around £38.5m after walking away from the deal. BSkyB's share price immediately began to fall. It was down by 23.5p, or 3.4%, to 669p at about 2.30pm on Wednesday, shortly after the announcement that the deal was off, far below the 700p level at which News Corp originally tabled a bid. More than £3bn has been wiped from the value of BSkyB shares since the Guardian revealed on Monday 4 July that News of the World journalists had hacked into a mobile phone belonging to murdered teenager Milly Dowler. The decision to walk away from the deal was taken earlier on Wednesday before prime minister's questions, which was followed by an announcement by David Cameron about the details of two separate inquiries, one into phone hacking and the other into media standards. Carey was at News International's Wapping offices on the fringes of the City of London briefly, where the decision is believed to have been finalised. Nick Clegg, the deputy prime minister, said withdrawing the bid was the "decent and sensible" thing do to. The Liberal Democrat leader briefly threatened to cause a coalition split when he declared Murdoch should abandon the Sky offer earlier this week, before Cameron decided he would also back a Labour motion to call for it to be dropped. The shadow culture secretary, Ivan Lewis, said: "It's a victory for the public of this country, it's a victory for parliament and it's a victory for the tremendous leadership that Ed Miliband has shown

Keith Olbermann says he was "blackmailed" by Murdoch as were other Murdoch employees. He comments come near 15 minute mark of great program. John Dean's preceding remarks are incisive. Olbermann promises more "blackmail" disclosures on his program tonight. http://www.youtube.com/watch?v=Z0aOFsT0wgA&feature=player_embedded

Family of Robert F. Kennedy Rethinks His Place at Library By ADAM CLYMER and DON VAN NATTA Jr. The New York Times July 12, 2011 WASHINGTON — As archivists prepare to make public 63 boxes of Robert F. Kennedy’s papers at the John F. Kennedy Library in Boston, his family members are having second thoughts about where they should be housed and are considering moving them elsewhere because they believe that the presidential library has not done enough to honor the younger brother’s legacy. Many of the papers, dealing with Cuba, Vietnam and civil rights, are classified as secret or top secret. There are also 2,300 other boxes covering every stage of Robert Kennedy’s life, including his years as a United States senator and attorney general, most of which have already been opened for research. But for decades, his family has refused to sign over title to the papers to the John F. Kennedy Presidential Library and Museum and is now talking openly about the possibility of finding a permanent home for them elsewhere. The family is also having Sotheby’s appraise the papers. “There is a very large building, and there is a remembrance of President Kennedy and there’s one for Senator Edward Kennedy,” said former Representative Joseph P. Kennedy II, a son of Robert Kennedy, describing the presidential library that opened in 1979 and an adjacent construction site for the Edward M. Kennedy Institute for the United States Senate. “But there is nothing out there for Robert Kennedy.” The presidential library — where many members of the Kennedy family, including Edward, believed the papers should remain — did offer last year to name a new 30,000-square-foot wing for Robert Kennedy if the family would donate the papers. The almost-finished wing has a classroom, a staging area for exhibits and storage for artifacts like Jacqueline Kennedy’s gowns and additional papers. The family refused. Joseph Kennedy scoffed at the proposal, saying in a recent interview, “They offered to put the name on a hallway.” The decision to open the 63 boxes, held in secret for nearly four decades, was reached on March 1 after years of efforts by library officials and others to persuade Robert Kennedy’s widow, Ethel Kennedy, to give control of his papers to the library. Though some historians are eager to see the new documents, Thomas J. Putnam, the library director, sought to dim speculation that they contained historical bombshells. “I think they are going to be of high interest to researchers,” Mr. Putnam said, “but I don’t think that there is going to be anything that will completely change the stories that have been written by other historians.” Archivists are now organizing and declassifying the papers, which have sat unseen in a climate-controlled vault while Mrs. Kennedy had talked of expecting to get millions of dollars from selling some of them, said two longtime family friends who discussed the family’s affairs on the condition of anonymity. In 2004, Mrs. Kennedy initiated discussions about donating the papers to George Washington University if it would establish a center honoring her husband’s memory and causes, several people involved in the discussions said. No money would have gone to her. But that effort foundered after the university’s president at the time, Stephen Joel Trachtenberg, asked Senator Edward M. Kennedy to finance it through a budget earmark for “a few million dollars,” Mr. Trachtenberg recalled. The senator, who wanted the papers to remain at the presidential library, refused the request, Mr. Trachtenberg said. Robert Kennedy’s papers are now being appraised by Sotheby’s, which has long ties to the Kennedy family, two people with direct knowledge of the confidential arrangements said. But an appraisal is not necessarily an indication of a planned sale; an appraisal is also required to establish their value for tax purposes if they are to be claimed as a charitable donation or passed on through an inheritance. Joseph Kennedy, who served in the House from 1987 to 1999, said in a recent interview, “There is certainly no plan to sell anything from this collection at this time.” He called seeing the papers permanently housed at the Kennedy Library “the ultimate hope and desire of my family.” Kathleen Kennedy Townsend, Robert and Ethel Kennedy’s first child, said her brother was speaking “for the family.” Joseph Kennedy, the eldest son, also said: “Could there be a situation where we decide to sell a document or two? Sure, I suppose.” But he said there was “no need” to sell any of the papers now. “My mother is fine,” Mr. Kennedy said. “She may not run a hedge fund, but most Americans would not mind being in her shoes.” Ethel Kennedy, 83, received $8.25 million in December 2009 when she sold Hickory Hill, the family estate in McLean, Va. In the interview, Joseph Kennedy emphasized that while the family would prefer to keep his father’s papers at the presidential library, for which his father helped raise money before he was assassinated in 1968, “that is not an automatic.” “There are other institutions and organizations that may well have an interest,” he said. “I have not contacted any of them. And they have not contacted me. There has been no discussion with anyone else, as of yet. I am also saying that I believe it is my responsibility to have those discussions in the future, the near future.” But he maintained that “wherever they end up being housed, there will be an insistence by my family that the public and scholars have access to the original documents.” Tension between Robert Kennedy’s family and the library goes back at least two decades. In February 1991, a new meeting facility was dedicated there and named for Stephen Smith, husband of Jean Kennedy Smith and brother-in-law to John, Robert and Edward Kennedy. Mr. Smith was a presidential campaign manager for Robert and Edward, was close to Edward after Robert’s death, and took a lead role in the development of the library. Paul G. Kirk Jr., the longtime chairman of the John F. Kennedy Library Foundation, recalled “at the time that the Smith Center was dedicated, they had a kind of a big gala celebration and so forth, and Ethel didn’t react positively, put it that way.” Joseph Kennedy said there was no doubt that his family had rights to his father’s papers. While ownership of papers from Robert Kennedy’s years at the Justice Department might be disputed under the Presidential Records Act, the National Archives and Records Administration, or NARA, which administers the library, was unwilling to argue about it. Gary M. Stern, general counsel at NARA, said, “We have been operating jointly on that presumption that these materials in their entirety would be donated to the Kennedy Library, and that to the extent there is any question about ownership, it doesn’t need to be addressed if they are all going to be donated to the Kennedy Library anyway.” The effort to place the papers at George Washington University came about when the Robert F. Kennedy Memorial Foundation, also located in Washington, was struggling financially to maintain its international programs. According to Jack Siggins, the university librarian, George Washington was approached by representatives of Ethel Kennedy and her daughter Kerry Kennedy, who is now president of the Robert F. Kennedy Center for Justice and Human Rights, as the foundation is now known. The university developed a plan to set up a center named for him, Mr. Siggins said. It would maintain the center’s existing human rights programs, combining them with elements of the university, and the library would also archive and maintain his papers. Ethel and Kerry Kennedy would be chairwomen of its advisory committee. Besides Senator Kennedy’s unwillingness to help, Mr. Siggins said, the plan failed because “they really wanted some kind of a special place, maybe even a building, a separate area where they could put these things and set up this R.F.K. Memorial.” The university could offer only two or three offices. Despite Mrs. Kennedy’s occasional talk of hoping to receive millions for the papers, she never sought money for herself either from George Washington, Mr. Trachtenberg said, or from the library, Mr. Putnam said. The new material from the 63 boxes should be available to the public in six months to a year, Mr. Putnam said. Scholars welcomed the news. Peter Kornbluh, a specialist on Cuba at the National Security Archive here, said that when the papers are opened, “I will try to be the first in line if I have to stand in front of the library all night long.” He added, “This is one of the few troves of history yet to be put into the public view.” Douglas Brinkley, an author and professor of history at Rice University, says he hopes the Kennedy Library finds a way to properly honor Robert Kennedy’s legacy. “Short of there being a Robert F. Kennedy Library, his personal papers should be part of the Kennedy Library,” Mr. Brinkley said. “In that spirit, the Kennedy Library needs to do a lot more for R.F.K.” He added, “I think Robert F. Kennedy inspired generations of Americans into politics. I believe R.F.K. was as big a figure in history as John Kennedy and Martin Luther King Jr. But no matter what is done, you will always stand in the shadow of a brother who was president.” Adam Clymer reported from Washington, and Don Van Natta Jr. from Miami.

http://www.ft.com/cms/s/0/6155b970-abe6-11e0-945a-00144feabdc0.html#ixzz1Ru7SyCWn Brown says Murdoch papers used known criminals By Ben Fenton, Chief Media Correspondent Financial Times July 12, 2011 Gordon Brown on Tuesday accused Rupert Murdochs newspapers of employing criminals to obtain confidential information about his family and others. The former Labour prime minister told the BBC that early in his time in office it appeared that The Sunday Times owned by Mr Murdochs News International had obtained confidential information on his bank account, legal files and possibly other material. Im genuinely shocked to find that this happened. If I with all the protection and all the defences that a chancellor or a prime minister has can be so vulnerable to unscrupulous and unlawful tactics, what about the ordinary citizen?, Mr Brown said. I find it quite incredible that a supposedly reputable organisation makes its money at the expense of ordinary people. I had my bank account broken into. I had my legal files effectively broken into. My tax returns went missing at one point. Medical records were broken into. I dont know how this happened. I do know that in two instances there is absolute proof that News International hired people to do this and the people who are doing this are criminals, known criminals in some cases with records of violence and fraud. Ed Miliband, leader of the Labour party said: Everything that has happened to Gordon is disgusting and adds to the list of outrageous practices by newspapers and reinforces the need for comprehensive action to be taken Mr Brown has been in the vanguard of fresh accusations of illegal and unethical journalistic methods that have descended on the Wapping headquarters of News International. Friends of Mr Brown confirmed on Monday that private files of highly personal information, from bank records to the medical files of his infant son, were illegally obtained by investigators and journalists working for the newspaper group. The claims, revealed by The Guardian, drew in Rebekah Brooks, chief executive of News International, with the allegation that in October 2006, when she was editor of The Sun, she had contacted Mr Brown and his wife Sarah in the hours after they discovered that their son Fraser had been diagnosed with cystic fibrosis to say her journalists were now privy to the secret. It is the first time that Ms Brooks has been directly linked to the unethical journalistic pursuits that have damaged the reputation of News International newspapers. Gordon Brown has now been informed of the scale of intrusion into his familys life, his office said in a statement. The family has been shocked by the level of criminality and the unethical means by which personal details have been obtained. The matter is in police hands. News International said in a statement that it had asked for all relevant information to be provided so it could investigate further. For the first time, one of Rupert Murdochs upmarket titles was also brought into the frame of suspicion over the use of so-called dark arts. Friends of Mr Brown confirmed that a private investigator working for The Sunday Times had on six separate occasions obtained information about his personal account with his bank, then known as Abbey National. According to the reports, the banks senior lawyer wrote to John Witherow, editor of The Sunday Times, accusing his staff of being complicit in this illegal obtaining of data. Unlike the legislation covering phone hacking, there is a public interest defence on abuses of the Data Protection Act. A person familiar with News Internationals investigation of illegal journalistic methods said the probe was linked to a story about Mr Browns purchase of a flat from a company, of which one director was Geoffrey Robinson, then paymaster-general of the same Labour government, at well below market price. The same person said of The Sun story about Fraser Browns condition that News International was comfortable that it had come from legitimate sources. In other developments on the phone-hacking story The Guardian reported that the Prince of Wales and the Duchess of Cornwall were told by police that their voicemails may have been hacked by News of the World. They were among a total of 10 members of the royal household to have been victims of phone-hacking. Prior to the launch of Operation Weeting, the renewed police investigation, only five royal household members had been identified as targets of the Sunday tabloid.

As the scandal grows, could Murdoch exit Britain altogether? A faction within the tycoon's empire has long wanted him to shed News International. Now they smell blood, says Ian Burrell The Independent Tuesday, 12 July 2011 http://www.independent.co.uk/news/media/press/as-the-scandal-grows-could-murdoch-exit-britain-altogether-2312102.html Will Rupert Murdoch abandon British newspapers entirely? After the dramatic demise of the News of the World, speculation was rife last night that the News Corp media empire might seek to sell off News International to protect the rest of its business from the fallout of the hacking scandal. Rupert Murdoch's media empire: what News Corp owns - click here to download graphic (170k) http://www.independent.co.uk/news/media/press/as-the-scandal-grows-could-murdoch-exit-britain-altogether-2312102.html With a tsunami of bad publicity threatening the company's bid to take control of BSkyB, the News Corp board in New York is likely to face questions from shareholders on the business case for retaining the News International stable of mostly loss-making titles. Pressure increased yesterday with news that a group of American institutional investors had brought new charges against the company over the phone-hacking affair. The investors, who are critical of Rupert Murdoch and his son and deputy, James, accused News Corp of "rampant nepotism and failed corporate governance". Beyond the chairman and chief executive himself, who has a long and sentimental attachment to the UK newspapers on which he built his fortune, News International has few friends at News Corp in the US where it will be held responsible for reducing the company's share price, which was down 6 per cent yesterday. "There has long been a faction within News Corp which says 'Why do we have these newspapers?'" notes Michael Wolff, contributing editor to Vanity Fair and Rupert Murdoch's biographer. He said that the former president and chief operating officer, Peter Chernin, had taken such a view, and that the current chief operating officer, Chase Carey, the most likely non-family member to succeed the ageing chairman, "has never had any involvement in the newspapers". Wolff said it was conceivable that News Corp would attempt to put the phone-hacking scandal behind it by selling News International. "It's quite possible that at some point one of the fall-back positions is to blame it all on the newspapers: 'It's newspaper culture and newspapers which are the problem here, not the company, which is a modern media company.' The newspapers were once the motor of this company but they have not been certainly in half a generation. In New York no one has heard of the News of the World." He said that the board of the US-listed company needed to show that it did not simply act at the behest of the chairman. "As boards of major companies go, this is one of the most docile and least independent. One of the themes that is going to be taken up there is of corporate governance and that these people are not accountable. That's a board-level question and I think the board is going to come under increasing pressure to realise that." The Times and Sunday Times made losses of £87.7m in the year to 28 June 2009. News International, including The Sun and News of the World, made an overall loss of £925,000 in 2010. The Sun is still profitable but its circulation of 2.8 million is down 3 per cent on last year. The closure of the News of the World is set to significantly reduce UK newspaper revenues which, at £1bn last year, are dwarfed by the £5.9bn made by BSkyB (of which News Corp takes 39 per cent), and represent a small slice of the £21bn revenue which News Corp makes worldwide. Douglas McCabe, of the media analysts Enders, said the News Corp board would not normally take a great deal of interest in the UK newspapers given their "relatively trivial" contribution to global revenues. "The News Corp accounts are very largely biased towards screen-based media," he said. "Newspaper media have for some time been a declining part of the portfolio. When there are no additional factors [the board] wouldn't spend much time thinking about [uK newspapers], either considering whether to sell or anything else. But when they are brought very much into relief by a situation like this, then you are forced to carefully consider what value they have in the overall portfolio." Despite the efforts of executives with responsibility for the London operation, such as James Murdoch and News International chief executive Rebekah Brooks, the scandal has crossed the Atlantic, being seized on by the US media and threatening to infect other prestigious News Corp brands. Les Hinton, who runs The Wall Street Journal, is expected to be called to give evidence to a public inquiry on hacking and asked to explain why he failed to appraise himself of the extent of the malpractice when he held his previous position as executive chairman of News International. Brian Cathcart, professor of journalism at Kingston University, agreed that it was getting harder to maintain a business case for News Corp retaining its interests in the British press. "If you were a shareholder in News Corp you might be looking at it and thinking: 'This is just a small limb of the organisation, we want this BSkyB deal, how can we have allowed this to screw it up?'" he said. He added that people who had purchased shares in News Corp had essentially made a decision to back the judgement of one man. "News Corp is not a normal business, it has grown on the genius of one businessman and if you are a shareholder you are just someone who is betting on Rupert Murdoch." Mr Murdoch had shown in his purchase of The Wall Street Journal that he still believes in newspapers but, having recently celebrated his 80th birthday, he may soon hand over to a successor who is less enamoured of having ink on his fingers. James Murdoch showed in folding the News of the World that he had limited sentimental loyalty for a paper that his father bought in 1969. Chase Carey may have even less of an attachment to News Corp's British prints. Professor Cathcart said: "The Times is a good newspaper now and better than it has been for most of Rupert Murdoch's ownership. Is The Times ever going to find another owner with pockets as deep as the Murdochs'? It's very hard to imagine." Murdoch's US circle Chase Carey As chief operating officer, he is Rupert Murdoch's No 2, running the day to day business of the company. He was brought back to News Corp in 2009 from a US satellite firm it had previously sold. In years past, Murdoch entrusted him with building satellite operations in Europe and Asia. Joel Klein He has been handed the task of overseeing the internal investigation into the hacking scandal. Until last year, he was running the New York schools system for mayor Michael Bloomberg. Murdoch hired him as a non-executive for his ties to the Democratic party establishment. Viet Dinh The Vietnamese immigrant to the US was Assistant Attorney General under President George W Bush. He is the other News Corp non-executive working on the hacking investigation and public relations fallout. Arthur Siskind If anyone knows where News Corp's bodies are buried, he knows, because he buried them. He was Mr Murdoch's senior in-house lawyer for 13 years, and stayed on after retirement in 2004 as "senior adviser to the chairman". Robert Thomson Mr Murdoch's last great adventure in the newspaper business, the acquisition of The Wall Street Journal, was cooked up with the former editor of the Times. Now Mr Thomson is editor of the WSJ and remains a trusted adviser.

Just 170 hacking victims contacted The Independent Tuesday, 12 July 2011 The police chief leading Scotland Yard's phone hacking probe has revealed just 170 of more than 4,000 potential victims have been contacted. The full scale of the long-running operation was laid bare as Deputy Assistant Commissioner Sue Akers admitted "confidence has been damaged" by previous failures. She admitted there was an "awful lot to do" after saying police had compiled a list of more than 12,000 names and numbers. Evidence from News International details 3,870 names along with 5,000 landline numbers and 4,000 mobiles, she told the committee of MPs. She gave MPs her "guarantee" that she would oversee a thorough inquiry, adding: "I hope that I do not have come back here in five years time."

Poster's note: I always suspected that Murdoch's illlegal wiretapping would eventually lead of his activities in the U.S. More bombshells should be forthcoming. ------------------------------------------------------------------- Phone hacking: 9/11 victims 'may have had mobiles tapped by News of the World reporters' by David Collins, Daily Mirror 11/07/2011 http://www.mirror.co.uk/news/top-stories/2011/07/11/phone-hacking-9-11-victims-may-have-had-mobiles-tapped-by-news-of-the-world-reporters-115875-23262694/#ixzz1RoIjV6FM DESPERATE Rupert Murdoch yesterday flew to London to try to save his ¬crumbling empire. He arrived in a cowboy-style hat to be hit by claims News of the World reporters hacked the phones of 9/11 victims. Murdoch held talks with News International chief executive Rebekah Brooks, amid fears nine staff and three cops may face jail. HIS media empire is crashing around him, he’s just shut down a scandal-hit newspaper and his BSkyB bid is in tatters, but Rupert Murdoch still came out grinning yesterday. And this cosy picture of him giving his backing to smiling Rebekah Brooks will no doubt infuriate the 200 loyal staff at the defunct News of the World who were ¬sacrificed while she clung to her job. As Labour leader Ed Miliband vowed to scupper Mr Murdoch’s bid to own all of BSkyB, the News Corp boss seemed to brush off his troubles to joke with the under-fire News International chief executive – who was editor when murdered teenager Milly Dowler’s phone was hacked. Asked what his first priority was, he gestured at Mrs Brooks and said: “This one.” Mr Murdoch arrived in London yesterday, wearing a Panama hat and clutching a final copy of the News of the World, in a bid to save his crumbling organisation after the phone-hacking scandal saw the 168-year-old paper axed. But he flew straight into another storm as it was claimed 9/11 victims may have had their mobiles tapped by News of the World reporters. And there was more bad news when it was revealed nine reporters -allegedly at the centre of the phone scandal and claims of police corruption could face jail, along with three officers. After he spent time at News International’s Wapping HQ in East London, 80-year-old Mr Murdoch held crisis talks with Mrs Brooks, 43 - who denies any knowledge of the Milly phone tapping - at his home in Mayfair. The pair chatted behind closed doors as a former New York cop made the 9/11 hacking claim. He alleged he was contacted by News of the World journalists who said they would pay him to retrieve the private phone records of the dead. Now working as a private ¬investigator, the ex-officer claimed reporters wanted the victim’s phone numbers and details of the calls they had made and received in the days leading up to the atrocity. A source said: “This investigator is used by a lot of journalists in America and he recently told me that he was asked to hack into the 9/11 victims’ private phone data. He said that the journalists asked him to access records showing the calls that had been made to and from the mobile phones belonging to the victims and their ¬relatives. “His presumption was that they wanted the information so they could hack into the ¬relevant voicemails, just like it has been shown they have done in the UK. The PI said he had to turn the job down. He knew how insensitive such research would be, and how bad it would look. “The investigator said the ¬journalists seemed particularly interested in getting the phone records belonging to the British victims of the attacks.” The News of the World was shut after 11,000 documents seized from a private investigator revealed the ugly truth behind many of its scoops. One police source said: “These documents show the hacking was not just one or two attempts at accessing voicemails. More than 4,000 people had their phone hacked. This was hacking on an industrial scale.” Mr Murdoch’s son James, who is chairman of News International, admitted to approving out of court settlements to hacking victims and misleading Parliament – which he claims was not deliberate. The fresh tapping claims prompted Mr Miliband to declare war on Mr Murdoch’s bid to control BSkyB. In his most outspoken attack on the media mogul yet, he said yesterday: “The idea that this organisation, which has engaged in these terrible ¬practices, should be allowed to take over BSkyB... without that criminal investigation having been completed, and on the basis of assurances from that self-same -organisation… frankly that won’t wash with the public.” Labour will table a motion on Wednesday calling on Culture Secretary Jeremy Hunt to delay signing off the takeover deal until the criminal investigation into the hacking allegations is wrapped up. Lib Dem -ministers are thought to be prepared to back the Labour leader. Deputy Prime Minister Nick Clegg and Business Secretary Vince Cable are said to be “totally united” against the bid. Lib Dem deputy leader Simon Hughes lent his support yesterday. He said: “I will be suggesting to my colleagues that we as a party, a party that’s never been close to Murdoch, should make clear that we think there should be a postponement of the decision.” Mr Murdoch also owns the Sun, the Times and the Sunday Times. Former News of the World editor Andy Coulson, 43, was arrested on Friday over phone hacking and police corruption ¬allegations. Ex-royal editor Clive Goodman, 53, was also held along with a unnamed 63-year-old man. All three were freed on police bail after being quizzed by officers. Mr Coulson was hired as David Cameron’s press aide, despite warnings to the PM over his possible knowledge of the hacking while at the News of the World. And last night criticism of Mr Cameron’s judgment grew louder as senior political figures lined up to reveal they had urged him not to take Mr Coulson into government. Lib Dem Lord Paddy Ashdown and Energy ¬Secretary Chris Huhne claimed they warned the PM after the election - but were ignored. Mr Huhne said: “Well I raised it with Nick and Nick raised it with the Prime Minister and it was made clear to us that this was a personal appointment to the Prime Minister. “It wasn’t a Government appointment and therefore we didn’t have any standing to object to it, but it was very clear from what I had said previously that I think there were big reputational risks. “The Prime Minister has said that he wanted to give Andy Coulson a second chance and that’s very commendable. The reality is that there were very serious risks being run there. We knew with Andy Coulson that anybody in charge of a ¬newspaper needs to know what’s going on and at the very least either Andy Coulson was complicit in criminal acts or, alternatively, he was a very incompetent editor by the ¬standards of Fleet Street.” Milly Dowler’s parents Sally and Bob and sister Gemma are due to meet Mr Clegg today. They will also see Mr Cameron later in the week, Downing Street has said. Read more: http://www.mirror.co.uk/news/top-stories/2011/07/11/phone-hacking-9-11-victims-may-have-had-mobiles-tapped-by-news-of-the-world-reporters-115875-23262694/#ixzz1RoIjV6FM

I was targeted too, Gordon Brown to say The Independent By Martin Hickman and Cahal Milmo Monday, 11 July 2011 Gordon Brown will today break his silence over the News International scandal by accusing Rupert Murdoch's organisation of targeting his personal information, The Independent has learnt. In a dramatic intervention in the deepening scandal, the Labour former Prime Minister is understood to be about to claim that private investigators working for the UK's largest newspaper group are believed to have accessed details relating to his personal bank account. It is also alleged that he and his wife featured in Glenn Mulcaire's records. It is claimed that material based on some of the illicitly-obtained information was subsequently used by one of News International's titles. Mr Brown's decision to make the accusations is the latest extraordinary twist in a tumultuous seven days which has shaken Mr Murdoch's British newspaper empire and almost certainly killed his £9bn bid for BSkyB. In a separate development, the Metropolitan Police today effectively accused News International of undermining Operation Elveden, its new inquiry into alleged corruption of police officers by journalists. In a statement, the Yard said it was "extremely concerned and disappointed that the continuous release of selected information - that is only known by a small number of people - could have a significant impact on the corruption investigation." News International is understood to have said that no information about emails supplied to Scotland Yard relating to the alleged payments would be made public prior to early August.

July 11, 2011 A Detective Alleges the News of the World Spied on Him With Impunity The New York Times By JO BECKER and SARAH LYALL LONDON — On Jan. 9, 2003, Rebekah Wade, until recently the editor of The News of the World, was summoned to an unusual meeting at Scotland Yard, the headquarters of the Metropolitan Police Service here. Detective Superintendent David Cook, the lead investigator in a gruesome cold-case killing of a man found with an ax in his head, confronted Ms. Wade with a worrying accusation: He and his family were being followed and photographed, he said, by people hired by her newspaper. Detective Cook said the police had evidence that one of The News of the World’s senior editors, Alex Marunchak, had ordered the illegal surveillance as a favor to two suspects in the case — Sid Fillery and Jonathan Rees, private investigators whose firm had done work for the paper. The lawyer for Mr. Cook, Mark Lewis, said in an interview that the detective believed that Mr. Fillery and Mr. Rees were seeking help in gathering evidence about Detective Cook to derail the murder inquiry. What happened at the meeting, a less detailed account of which appeared in The Guardian, provides a window into the extraordinary coziness that long existed between the British police and The News of The World, as well as the relationship between the paper and unsavory characters in the criminal world. None of the parties to this alliance has escaped the stain. The paper, at the center of a widening scandal over phone hacking and corruption, was shut last week by News International, its parent company, in an effort to limit the already extensive damage done to the reputation and business interests of Rupert Murdoch, the chairman of News Corporation. Scotland Yard has admitted that it accepted News International’s explanation that the hacking was the work of one rogue reporter, and that some police officers had accepted substantial payments in exchange for confidential information. The News of the World remains the target of several criminal investigations. A number of its former editors and reporters have been arrested, including Andy Coulson, who most recently worked as the chief spokesman for Mr. Cameron, but no one has yet been formally charged. And Prime Minister David Cameron has announced he will appoint a judge to examine both the tabloid’s hacking and its close relationship with the police. Also present for the meeting that day in 2003, said a spokesman for Scotland Yard, were Commander Andy Baker, who was Detective Cook’s boss, and Dick Fedorcio, Scotland Yard’s chief public relations officer. According to an account Detective Cook provided to Mr. Lewis and others, Ms. Wade excused the surveillance by saying that the paper’s action had been “in the public interest” — the argument British newspapers typically make to justify using underhanded or illegal methods to, say, expose affairs by public officials. Ms. Wade said that the paper was tailing Detective Cook because it suspected him of having an affair with Jackie Haines, host of the Crimewatch television program on which he had recently appeared. In fact, the two were married to each other, as had been mentioned prominently in an article about them in the popular gossip magazine “Hello!” Scotland Yard seems to have been satisfied with the explanation of Ms. Wade, now known as Rebekah Brooks and the chief executive of News International. Her paper’s editors and reporters had a long history with the police — paying for tips and sometimes even serving as quasi-police investigators themselves, in return for confidential information (many News of the World stories about criminal matters used to include a reference to the paper’s handing “a dossier” of its findings to Scotland Yard). It is the closeness between the paper and the police that, it seems, led Scotland Yard to what officials have retrospectively admitted was a major misstep: the decision not to adequately pursue the initial phone-hacking investigation in 2006 and again in 2009. It was in 2006 that members of the royal household notified the police that they believed their cellphone messages were being intercepted by The News of the World. The subsequent police “raid” at the paper consisted of rummaging through a single reporter’s desk and failing to question any other reporters or editors. Two people were subsequently jailed: Clive Goodman, The News of the World’s royal reporter, and Glenn Mulcaire, a private investigator hired by the paper. Even when The Guardian reported that the hacking had extended far beyond the pair, and that thousands of victims might be involved, the police and the newspaper insisted repeatedly that the wrongdoing had been limited to a single “rogue” reporter. This weekend, Assistant Commissioner John Yates, who was in charge of the initial inquiry and who in 2009 declined to reopen it, said that the police response had been inadequate. “I have regrettably said the initial inquiry was a success,” he told The Sunday Telegraph. “Clearly, now it looks very different.” After the meeting at Scotland Yard, Detective Cook left “with the impression that the meeting was arranged to placate him and let him get it off his chest, but that nothing else was going to happen,” Mr. Lewis said. “And nothing did.” A spokesman for Scotland Yard said that “the matter was raised at the meeting at a senior level with the relevant people, and it was dealt with.” When asked how it was dealt with, the spokesman added: “The response to those concerns was the meeting.” But a former senior Scotland Yard official said that the tailing of Detective Cook should have prompted a full-scale inquiry. “I’m amazed that wasn’t done,” said the official, who was not authorized to speak publicly. A spokeswoman for News Corporation, the parent company of News International, said the company “had not been previously made aware of the allegation that Ms. Brooks had known about the matter but done nothing, but that they will investigate any allegations that are put to them.” Mr. Rees and Mr. Fillery could not be reached for comment because their locations are unknown. Through his lawyer, Paul Jonson, Mr. Marunchak denied any wrongdoing. No one has ever been convicted in connection with Mr. Martin’s death, despite five police investigations in 24 years, in which Mr. Fillery and Mr. Rees have been repeatedly arrested and charged. The most recent case collapsed this spring. Speaking in the House of Commons on Wednesday, Tom Watson, a Member of Parliament for the Labour Party, said that the meeting showed the extent of the corrupt relationship between The News of the World on the one hand, and the police and the shady underworld of private investigators with criminal connections on the other. “News International was paying people to interfere with police officers and was doing so on behalf of known criminals,” he said. (Mr. Fillery was convicted in 2003 of making indecent images of children; Mr. Rees of planting cocaine in a woman’s car to discredit her a child-custody case.) Speaking of Ms. Brooks, he said: “Rebekah Brooks cannot deny being present at that meeting when the actions of people whom she paid were exposed. She cannot deny now being warned that under her auspices unlawful tactics were used for the purpose of interfering with the pursuit of justice.” As for Detective Cook, it appears that he, too, was a victim of phone hacking around the same time that the paper had his house under surveillance. But Scotland Yard notified Mr. Cook only eight weeks ago that his name had been found among the papers seized in 2006 in Mr. Mulcaire’s home.

News International knew hacking was widespread in 2007 Evidence of cover-up emerges as Murdoch's bid for BSkyB looks doomed The Independent By Martin Hickman, Cahal Milmo, Oliver Wright and Ian Burrell Monday, 11 July 2011 Rupert Murdoch's takeover of BSkyB appeared to be dead in the water last night after proof emerged that executives at his British newspaper empire mounted a cover-up of the full scale of alleged criminal wrongdoing at the News of the World. In another extraordinary day in the phone-hacking scandal, Downing Street sources confirmed that Government lawyers were drawing up a strategy to halt the £9bn deal which looked a certainty only a week ago. As Nick Clegg threatened to split the Coalition by siding with a Labour plan to block the takeover, a senior Government source said last night: "We are working on a plan to suspend the deal while the police investigation is taking place. But we have to ensure it doesn't get thrown out by judicial review." The U-turn came after one of News International's own papers revealed that an internal report carried out in 2007, after the News of the World's royal editor Clive Goodman was jailed, had found evidence that illegally accessing voicemails was more widespread at the paper – and that payments had been made to police officers. An anonymous executive was quoted as saying that the report had been like a "ticking time bomb". The report suggests there was a deliberate cover-up by unidentified executives at News International, which had told Parliamentary inquiries in 2007 and 2009 there was no evidence journalists other than Goodman had been involved in phone hacking, nor that it had attempted to suppress evidence of illegality. The collapse of the cover-up came as: * Rupert Murdoch flew into London and was seen entering News International's Wapping HQ carrying a copy of the last ever News of the World. * Labour leader Ed Miliband confirmed his party's opposition to the BSkyB bid and won backing from senior Lib Dems. * One of Scotland Yard's most senior officers, John Yates, admitted that his decision to fend off demands for a re-opening of the criminal investigation into the NOTW had been "pretty crap". * The parents of the murdered schoolgirl Milly Dowler, whose phone was targeted by the paper, prepared to travel to Downing Street to demand action over the growing scandal. * The News of the World published its final edition after 168 years with the headline "Thank You & Goodbye", and and an apology for having "lost its way". * An audacious bid was being made by to resurrect the Sunday paper. The Government's U-turn over its backing for the BSkyB deal is a humiliation for the Prime Minister, who last week said he was powerless to stop it. Liberal Democrat officials revealed Nick Clegg would back a Labour parliamentary motion calling for the takeover to be suspended, unless Culture Secretary Jeremy Hunt acted before a Commons debate on Wednesday. Ministers are thought to have been hoping Ofcom would block the deal under its "fit and proper persons" test for broadcasters, but with that looking unlikely before the end of the criminal investigation, they are taking action themselves. Lawyers in the Department of Culture, Media and Sport are thought to be looking at whether the assurances given by News Corporation on plurality can be trusted in light of the growing evidence of corporate wrongdoing. Yesterday, Mr Miliband warned Mr Cameron that unless there was action before Wednesday, he would force the issue to a vote in Parliament. He said: "I say this to the Prime Minister: over the next 72 hours I hope he changes his position." Hours after flying into Britain, Mr Murdoch continued his support of Rebekah Brooks, the embattled chief executive of News International and former News of the World editor. But the company came under further pressure as it emerged that unidentified NI executives knew as far back as 2007 that criminality at the title was apparently widespread. It subsequently insisted that only Goodman had been to blame, telling Parliament that there was no evidence other journalists were involved. Following allegations that the victims of phone hacking spread far beyond royal aides and the five individuals identified at the trial of Goodman and private investigator Glenn Mulcaire, News International carried out a "thorough investigation" in 2009. Apart from Goodman and Mulcaire, it said there was no no evidence that "News of the World journalists have accessed the voicemails of any individual" or "News of the World or its journalists have instructed private investigators or other third parties to access the voicemails of any individuals". Scotland Yard, whose Assistant Commissioner John Yates said in an interview that he had failed to carry out a proper review of the evidence in 2009, now concedes that there are almost 4,000 victims of phone hacking. Company sources last night said that neither Ms Brooks nor James Murdoch, News Corp's European chief executive, had seen the 2007 report until April. Today the family of Milly Dowler will meet Mr Clegg. The paper that hacked their daughter's phone printed its last edition yesterday, saying it had carried out important investigative journalism. Its front page said: "After 168 years, we finally say a sad but very proud farewell to our 7.5m loyal readers." How Murdoch's lieutenants pleaded ignorance 06.03.2007 John Whittingdale (DCMS Select Committee chairman): "You carried out a full, rigorous internal inquiry, and you are absolutely convinced that Clive Goodman was the only person who knew what was going on?" Les Hinton: "Yes, we have and I believe he was the only person, but that investigation, under the new editor, continues." 21.07.2009 Tom Crone: "At no stage during their [the police's] investigation or ours did any evidence arise that the problem of accessing [voicemails] by our reporters, or complicity of accessing by our reporters, went beyond the Goodman/Mulcaire situation." Asked whether any journalists other than Goodman dealt with Mulcaire, he said: "No evidence was found." 21.07.2009 After Philip Davies MP suggested journalists other than Clive Goodman must have been involved, Myler said: "No evidence, Mr Davies, has been produced internally or externally by the police, by any lawyers, to suggest that what you have said is the truth, is the case." 21.07.2009 "As far as I am aware, there is no evidence linking the non-royal phone-hacking allegations that were made against Glenn Mulcaire to any member of the News of the World staff. I think that Clive was a rogue case on the News of the World." 15.09.2009 "... There was never any evidence delivered to me that suggested that the conduct of Clive Goodman spread beyond him."

http://www.ft.com/cms/s/0/8c43aca6-ab18-11e0-b4d8-00144feabdc0.html#ixzz1RkTY7iZK Dow Jones chief under hacking pressure By Andrew Edgecliffe-Johnson in New York, Abeer Allam in Riyadh and Elizabeth Rigby in London Financial Times July 10, 2011 Les Hinton, chief executive of Dow Jones, is being blamed by people close to News Corp, for failing to get to grips with the News of the World phone hacking scandal when he was in charge of Rupert Murdoch’s UK newspaper group. Mr Hinton, a loyal Murdoch employee for 52 years who had been expected to retire next year, could become the most senior casualty of the crisis, his friends fear, deflecting blame from James Murdoch, who runs News Corp’s European operations, and Rebekah Brooks, chief executive of News International, which publishes Mr Murdoch’s UK papers. “Les [Hinton] will be sacrificed to save James and Rebekah,” one person familiar with the company said. “It happened on Les’s watch,” another added: “James was not even a director of News Corp at the time.” Rupert Murdoch, who arrived in London on Sunday to take charge of the crisis, is facing growing political opposition to his bid for full control of British Sky Broadcasting, but received critical support from News Corp’s largest non-family shareholder. “This is the time for a loyal shareholder to stand by his friends and allies, the Murdoch family,” Prince Al Waleed bin Talal, chairman of Kingdom Holdings, which owns 7 per cent of the company, told the Financial Times. “This is a strong alliance. We do not chicken out when we face crisis; we get stronger,“ he said, adding that Mr Murdoch, his son James and Chase Carey, chief operating officer, made “an excellent trio” of managers. He added that he had urged Mr Murdoch for “a dramatic and fast decision” to end the News of the World “mini crisis” and focus on securing BSkyB. The backing came as David Cameron, the British prime minister, was scrambling to find a way to delay News Corp’s bid after Ed Miliband, the opposition Labour leader, announced Labour would call a parliamentary vote on the matter. The move was supported by some leading Liberal Democrats, who govern in coalition with Mr Cameron’s Conservatives. Mr Hinton “has questions to answer” about what he originally reassured a parliamentary committee had been a rigorous internal inquiry in 2007, people close to News Corp said. That inquiry had involved Colin Myler, editor of the News of the World, Daniel Cloke, News International’s former head of human resources, Tom Crone, general counsel for the News of the World, and Harbottle & Lewis, the law firm, they said. Mr Hinton declined requests for comment. Mr Hinton may not have seen all the evidence he needed to see in 2007, one person familiar with News International’s new internal inquiry said. Police are expected to ask some News International executives this week to give witness statements. News International had no comment. Mr Murdoch drove into News International’s Wapping offices for a series of meetings reading the final edition of the News of the World. He was later photographed with his arm around Ms Brooks, telling Reuters she was his first priority before dining with her. Keith Vaz, home affairs select committee chairman, said John Yates, Scotland Yard Assistant Commissioner, would appear before MPs on Tuesday. Additional reporting by Ben Fenton and Salamander Davoudi in London

John O'Connor: The suspects are in charge of the case News International and the Metropolitan Police are looking into corruption at Wapping. But face-saving is their priority The Independent Sunday, 10 July 2011 Scotland Yard is facing its worst corruption crisis since the 1970s, when senior police officers were found to be controlling London's pornography industry. The investigation and subsequent purge left many detectives out of a job and in some case serving prison sentences. The gloom that surrounded the Yard in those days is similar to the atmosphere that pervades it today. Each day reveals more details of misconduct by the press and the police. The investigation is going to be looking for heads to roll, and the higher the rank the better. This extraordinary state of affairs has its roots back in the Eighties, in the days when News International was dependent on the police to protect its new premises in Wapping. Violent demonstrations occurred each night and the police were able to assist News International in getting its product out on to the streets. This was a complete turnaround for The Times newspaper, which only a decade earlier had launched the huge inquiry into police corruption that shook Scotland Yard to its foundations. News International was now best friends with Scotland Yard, and senior executives and top policemen wined and dined together on a regular basis. Nobody could see the potential problems of a free lunch. This mutual admiration society worked very well for a time. Information passed freely both ways. The police benefited from undercover operations run by the newspapers, and in return the papers got their exclusive stories. This comfortable arrangement was cemented by regular briefings from Scotland Yard's press bureau to the national press directly and sometimes through the Crime Writers Association. The culture of police officers mixing with journalists was encouraged, and little thought was given to the potential of misconduct. Crime writers were expected to know lots of police officers, and there was great competition to get the inside story. If only things could have stayed the same. The News of the World began to pursue a strategy of aggressively targeting celebrities. The use of "the Fake Sheikh", Mazher Mahmood, was very effective, and produced some exclusive exposés on the greed and stupidity of people who should have known better. They were able to obtain confidential information on individuals including criminal records but they were in too much of a hurry to research public records. Some private detective agencies realised that there was money to be earned from celebrity stories and confidential crime stories. Some of these detective agencies were run by former Metropolitan Police officers who maintained good contacts with serving officers. Some ex-police officers set themselves up as stringers, and provided a conduit for confidential information supplied by officers directly to the press. Once the Rubicon had been crossed, it was comparatively easy for police officers to contravene the Data Protection Act and supply information from the Police National Computer. Short cuts adopted by the News of the World put them closer to the coalface. The strategy of using several intermediaries was abandoned and they employed private detectives such as Jonathan Rees of Southern Investigations and Glenn Mulcaire. This was clearly cheaper but the drawback was that if the private detectives came unstuck so did those who hired them. The Department of Professional Standards at Scotland Yard has not been standing idly by. A number of undercover operations were mounted against ex- and serving police officers who were suspected of receiving corrupt payments. Nobody in authority was prepared to recognise the endemic nature of this corruption and each case was dealt with as a stand-alone incident. Much the same attitude was adopted when Glenn Mulcaire and Clive Goodman were convicted of hacking messages of members of the royal family. At this stage, the number of police officers involved is unknown. News International's attempts to switch the focus of the inquiry onto the police by releasing details of payments to officers raised more questions than answers. The obvious questions are "What about payments to intermediaries?" and "What were the payments for?" Hospitality and gifts must also be probed. The two organisations that are carrying out the investigations are... the Metropolitan Police and News International, both of whom are the subject of these allegations. It is with breathtaking cheek that News International announced its own investigation. It is quite clear that getting to the truth is not a goal, its real objective is damage limitation and face-saving. It is quite clear that any number of junior staff will be sacrificed in order the save the skins of the real decision-makers. The News International investigation should be laughed out of court, not that it is ever likely to get there. The new police investigation is even more curious. Everybody wants to know why the original hacking investigation was curtailed after the convictions of Mulcaire and Goodman. It seems unlikely that this decision was made solely by the police, but it is a possibility, and if so, why? The suspicion must be that pressure was brought to bear by either News International, the Crown Prosecution Service or a very high-ranking police officer, or perhaps a combination of all three. The new police investigation into hacking has been running since January 2011 and the police corruption enquiry has only just begun. It seems to me that this is a classic situation whereby an outside police force should be used, under the supervision of the Independent Police Complaints Commission. There is clear precedent for using an outside force, and if the public are to be convinced that this is a fair and unbiased investigation then that should clearly point to using an independent force outside of London. This is no reflection on the skill, determination or ability of Deputy Assistant Commissioner Sue Akers, but the pressure which killed off the first enquiry might still exist. The Metropolitan Police had one go at this and fell very short. At risk is the reputation and integrity of the service. It cannot afford to get it wrong again. The problem is that senior officers did not recognise the extent of the corruption and were probably unwilling to upset their new found pals in the media. They must accept their responsibility for what has happened. It is astonishing that with so many resources being spent on anti-corruption, they could not see it when it was right under their noses. John O'Connor is former commander of the Flying Squad at Scotland Yard

Murdoch's Watergate His anything-goes approach has spread through journalism like a contagion. Now it threatens to undermine the influence he so covets. By Carl Bernstein Newsweek.com July 11, 2011 http://www.newsweek.com/2011/07/10/murdoch-s-watergate.html?om_rid=Ci42oa&om The hacking scandal currently shaking Rupert Murdoch’s empire will surprise only those who have willfully blinded themselves to that empire’s pernicious influence on journalism in the English-speaking world. Too many of us have winked in amusement at the salaciousness without considering the larger corruption of journalism and politics promulgated by Murdoch Culture on both sides of the Atlantic. The facts of the case are astonishing in their scope. Thousands of private phone messages hacked, presumably by people affiliated with the Murdoch-owned News of the World newspaper, with the violated parties ranging from Prince William and actor Hugh Grant to murder victims and families of soldiers killed in Iraq and Afghanistan. The arrest of Andy Coulson, former press chief to Prime Minister David Cameron, for his role in the scandal during his tenure as the paper’s editor. The arrest (for the second time) of Clive Goodman, the paper’s former royals editor. The shocking July 7 announcement that the paper would cease publication three days later, putting hundreds of employees out of work. Murdoch’s bid to acquire full control of cable-news company BSkyB placed in jeopardy. Allegations of bribery, wiretapping, and other forms of lawbreaking—not to mention the charge that emails were deleted by the millions in order to thwart Scotland Yard’s investigation. All of this surrounding a man and a media empire with no serious rivals for political influence in Britain—especially, but not exclusively, among the conservative Tories who currently run the country. Almost every prime minister since the Harold Wilson era of the 1960s and ’70s has paid obeisance to Murdoch and his unmatched power. When Murdoch threw his annual London summer party for the United Kingdom’s political, journalistic, and social elite at the Orangery in Kensington Gardens on June 16, Prime Minister Cameron and his wife, Sam, were there, as were Labour leader Ed Miliband and assorted other cabinet ministers. Murdoch associates, present and former—and his biographers—have said that one of his greatest long-term ambitions has been to replicate that political and cultural power in the United States. For a long time his vehicle was the New York Post—not profitable, but useful for increasing his eminence and working a wholesale change not only in American journalism but in the broader culture as well. Page Six, emblematic in its carelessness about accuracy or truth or context—but oh-so-readable—became the model for the gossipization of an American press previously resistant to even considering publishing its like. (Murdoch accomplished a similar debasement of the airwaves in the 1990s with the—tame by today’s far-lower standards—tabloid television show Hard Copy.) Then came the unfair and imbalanced politicized “news” of the Fox News Channel—showing (again) Murdoch’s genius at building an empire on the basis of an ever-descending lowest journalistic denominator. It, too, rests on a foundation that has little or nothing to do with the best traditions and values of real reporting and responsible journalism: the best obtainable version of the truth. In place of this journalistic ideal, the enduring Murdoch ethic substitutes gossip, sensationalism, and manufactured controversy. And finally, in 2007 The Wall Street Journal’s squabbling family owners succumbed to his acumen, willpower, and money, fulfilling Murdoch’s dream of owning an American newspaper to match the influence and prestige of his U.K. holding, The Times of London—one that really mattered, at the topmost tier of journalism. Between the Post, Fox News, and the Journal, it’s hard to think of any other individual who has had a greater impact on American political and media culture in the past half century. But now the empire is shaking, and there’s no telling when it will stop. My conversations with British journalists and politicians—all of them insistent on speaking anonymously to protect themselves from retribution by the still-enormously powerful mogul—make evident that the shuttering of News of the World, and the official inquiries announced by the British government, are the beginning, not the end, of the seismic event. News International, the British arm of Murdoch’s media empire, “has always worked on the principle of omertà: ‘Do not say anything to anybody outside the family, and we will look after you,’ ” notes a former Murdoch editor who knows the system well. “Now they are hanging people out to dry. The moment you do that, the omertà is gone, and people are going to talk. It looks like a circular firing squad.” News of the World was always Murdoch’s “baby,” one of the largest newspapers in the English-speaking world, with 2.6 million readers. As anyone in the business will tell you, the standards and culture of a journalistic institution are set from the top down, by its owner, publisher, and top editors. Reporters and editors do not routinely break the law, bribe policemen, wiretap, and generally conduct themselves like thugs unless it is a matter of recognized and understood policy. Private detectives and phone hackers do not become the primary sources of a newspaper’s information without the tacit knowledge and approval of the people at the top, all the more so in the case of newspapers owned by Rupert Murdoch, according to those who know him best. As one of his former top executives—once a close aide—told me, “This scandal and all its implications could not have happened anywhere else. Only in Murdoch’s orbit. The hacking at News of the World was done on an industrial scale. More than anyone, Murdoch invented and established this culture in the newsroom, where you do whatever it takes to get the story, take no prisoners, destroy the competition, and the end will justify the means.” “In the end, what you sow is what you reap,” said this same executive. “Now Murdoch is a victim of the culture that he created. It is a logical conclusion, and it is his people at the top who encouraged lawbreaking and hacking phones and condoned it.” Could Murdoch eventually be criminally charged? He has always surrounded himself with trusted subordinates and family members, so perhaps it is unlikely. Though Murdoch has strenuously denied any knowledge at all of the hacking and bribery, it’s hard to believe that his top deputies at the paper didn’t think they had a green light from him to use such untraditional reportorial methods. Investigators are already assembling voluminous records that demonstrate the systemic lawbreaking at News of the World, and Scotland Yard seems to believe what was happening in the newsroom was endemic at the highest levels at the paper and evident within the corporate structure. Checks have been found showing tens of thousands of dollars of payments at a time. For this reporter, it is impossible not to consider these facts through the prism of Watergate. When Bob Woodward and I came up against difficult ethical questions, such as whether to approach grand jurors for information (which we did, and perhaps shouldn’t have), we sought executive editor Ben Bradlee’s counsel, and he in turn called in the company lawyers, who gave the go-ahead and outlined the legal issues in full. Publisher Katharine Graham was informed. Likewise, Bradlee was aware when I obtained private telephone and credit-card records of one of the Watergate figures. All institutions have lapses, even great ones, especially by individual rogue employees—famously in recent years at The Washington Post, The New York Times, and the three original TV networks. But can anyone who knows and understands the journalistic process imagine the kind of tactics regularly employed by the Murdoch press, especially at News of the World, being condoned at the Post or the Times? And then there’s the other inevitable Watergate comparison. The circumstances of the alleged lawbreaking within News Corp. suggest more than a passing resemblance to Richard Nixon presiding over a criminal conspiracy in which he insulated himself from specific knowledge of numerous individual criminal acts while being himself responsible for and authorizing general policies that routinely resulted in lawbreaking and unconstitutional conduct. Not to mention his role in the cover-up. It will remain for British authorities and, presumably, disgusted and/or legally squeezed News Corp. executives and editors to reveal exactly where the rot came from at News of the World, and whether Rupert Murdoch enabled, approved, or opposed the obvious corruption that infected his underlings. None of this is to deny Murdoch’s competitive genius, his superior understanding of the modern media marketplace, or his dead-on reading of popular culture. He has made occasionally dull newspapers fun to read and TV news broadcasts fun to watch, and few of us would deny there are days when we love it. He’s been at his best when he’s come in from the outside: starting Sky News, which shook up a complacent British broadcasting establishment; contradicting conventional American media wisdom that a fourth TV network (Fox) could never get off the ground; reducing the power of Britain’s printing trade unions that were exercising a stranglehold on the U.K. press. But Murdoch and his global media empire have a lot to answer for. He has not merely encouraged the metastasis of cutthroat tabloid journalism on both sides of the Atlantic. But perhaps just as troubling, authorities in Britain may respond to popular outrage at the scandal by imposing the kind of regulations that cannot help but undermine a truly free press. The events of recent days are a watershed for Britain, for the United States, and for Rupert Murdoch. Tabloid journalism—and our tabloid culture—may never be the same. Bernstein’s most recent book is A Woman in Charge: The Life of Hillary Rodham Clinton. Correction: This article initially described News of the World as a daily paper.

Murdochs Watergate? His anything-goes approach has spread through journalism like a contagion. Now it threatens to undermine the influence he so covets. By Carl Bernstein Newsweek.com July 11, 2011 http://www.newsweek.com/2011/07/10/murdoch-s-watergate.html?om_rid=Ci42oa&om The hacking scandal currently shaking Rupert Murdochs empire will surprise only those who have willfully blinded themselves to that empires pernicious influence on journalism in the English-speaking world. Too many of us have winked in amusement at the salaciousness without considering the larger corruption of journalism and politics promulgated by Murdoch Culture on both sides of the Atlantic. The facts of the case are astonishing in their scope. Thousands of private phone messages hacked, presumably by people affiliated with the Murdoch-owned News of the World newspaper, with the violated parties ranging from Prince William and actor Hugh Grant to murder victims and families of soldiers killed in Iraq and Afghanistan. The arrest of Andy Coulson, former press chief to Prime Minister David Cameron, for his role in the scandal during his tenure as the papers editor. The arrest (for the second time) of Clive Goodman, the papers former royals editor. The shocking July 7 announcement that the paper would cease publication three days later, putting hundreds of employees out of work. Murdochs bid to acquire full control of cable-news company BSkyB placed in jeopardy. Allegations of bribery, wiretapping, and other forms of lawbreakingnot to mention the charge that emails were deleted by the millions in order to thwart Scotland Yards investigation. All of this surrounding a man and a media empire with no serious rivals for political influence in Britainespecially, but not exclusively, among the conservative Tories who currently run the country. Almost every prime minister since the Harold Wilson era of the 1960s and 70s has paid obeisance to Murdoch and his unmatched power. When Murdoch threw his annual London summer party for the United Kingdoms political, journalistic, and social elite at the Orangery in Kensington Gardens on June 16, Prime Minister Cameron and his wife, Sam, were there, as were Labour leader Ed Miliband and assorted other cabinet ministers. Murdoch associates, present and formerand his biographershave said that one of his greatest long-term ambitions has been to replicate that political and cultural power in the United States. For a long time his vehicle was the New York Postnot profitable, but useful for increasing his eminence and working a wholesale change not only in American journalism but in the broader culture as well. Page Six, emblematic in its carelessness about accuracy or truth or contextbut oh-so-readablebecame the model for the gossipization of an American press previously resistant to even considering publishing its like. (Murdoch accomplished a similar debasement of the airwaves in the 1990s with thetame by todays far-lower standardstabloid television show Hard Copy.) Then came the unfair and imbalanced politicized news of the Fox News Channelshowing (again) Murdochs genius at building an empire on the basis of an ever-descending lowest journalistic denominator. It, too, rests on a foundation that has little or nothing to do with the best traditions and values of real reporting and responsible journalism: the best obtainable version of the truth. In place of this journalistic ideal, the enduring Murdoch ethic substitutes gossip, sensationalism, and manufactured controversy. And finally, in 2007 The Wall Street Journals squabbling family owners succumbed to his acumen, willpower, and money, fulfilling Murdochs dream of owning an American newspaper to match the influence and prestige of his U.K. holding, The Times of Londonone that really mattered, at the topmost tier of journalism. Between the Post, Fox News, and the Journal, its hard to think of any other individual who has had a greater impact on American political and media culture in the past half century. But now the empire is shaking, and theres no telling when it will stop. My conversations with British journalists and politiciansall of them insistent on speaking anonymously to protect themselves from retribution by the still-enormously powerful mogulmake evident that the shuttering of News of the World, and the official inquiries announced by the British government, are the beginning, not the end, of the seismic event. News International, the British arm of Murdochs media empire, has always worked on the principle of omertà: Do not say anything to anybody outside the family, and we will look after you, notes a former Murdoch editor who knows the system well. Now they are hanging people out to dry. The moment you do that, the omertà is gone, and people are going to talk. It looks like a circular firing squad. News of the World was always Murdochs baby, one of the largest newspapers in the English-speaking world, with 2.6 million readers. As anyone in the business will tell you, the standards and culture of a journalistic institution are set from the top down, by its owner, publisher, and top editors. Reporters and editors do not routinely break the law, bribe policemen, wiretap, and generally conduct themselves like thugs unless it is a matter of recognized and understood policy. Private detectives and phone hackers do not become the primary sources of a newspapers information without the tacit knowledge and approval of the people at the top, all the more so in the case of newspapers owned by Rupert Murdoch, according to those who know him best. As one of his former top executivesonce a close aidetold me, This scandal and all its implications could not have happened anywhere else. Only in Murdochs orbit. The hacking at News of the World was done on an industrial scale. More than anyone, Murdoch invented and established this culture in the newsroom, where you do whatever it takes to get the story, take no prisoners, destroy the competition, and the end will justify the means. In the end, what you sow is what you reap, said this same executive. Now Murdoch is a victim of the culture that he created. It is a logical conclusion, and it is his people at the top who encouraged lawbreaking and hacking phones and condoned it. Could Murdoch eventually be criminally charged? He has always surrounded himself with trusted subordinates and family members, so perhaps it is unlikely. Though Murdoch has strenuously denied any knowledge at all of the hacking and bribery, its hard to believe that his top deputies at the paper didnt think they had a green light from him to use such untraditional reportorial methods. Investigators are already assembling voluminous records that demonstrate the systemic lawbreaking at News of the World, and Scotland Yard seems to believe what was happening in the newsroom was endemic at the highest levels at the paper and evident within the corporate structure. Checks have been found showing tens of thousands of dollars of payments at a time. For this reporter, it is impossible not to consider these facts through the prism of Watergate. When Bob Woodward and I came up against difficult ethical questions, such as whether to approach grand jurors for information (which we did, and perhaps shouldnt have), we sought executive editor Ben Bradlees counsel, and he in turn called in the company lawyers, who gave the go-ahead and outlined the legal issues in full. Publisher Katharine Graham was informed. Likewise, Bradlee was aware when I obtained private telephone and credit-card records of one of the Watergate figures. All institutions have lapses, even great ones, especially by individual rogue employeesfamously in recent years at The Washington Post, The New York Times, and the three original TV networks. But can anyone who knows and understands the journalistic process imagine the kind of tactics regularly employed by the Murdoch press, especially at News of the World, being condoned at the Post or the Times? And then theres the other inevitable Watergate comparison. The circumstances of the alleged lawbreaking within News Corp. suggest more than a passing resemblance to Richard Nixon presiding over a criminal conspiracy in which he insulated himself from specific knowledge of numerous individual criminal acts while being himself responsible for and authorizing general policies that routinely resulted in lawbreaking and unconstitutional conduct. Not to mention his role in the cover-up. It will remain for British authorities and, presumably, disgusted and/or legally squeezed News Corp. executives and editors to reveal exactly where the rot came from at News of the World, and whether Rupert Murdoch enabled, approved, or opposed the obvious corruption that infected his underlings. None of this is to deny Murdochs competitive genius, his superior understanding of the modern media marketplace, or his dead-on reading of popular culture. He has made occasionally dull newspapers fun to read and TV news broadcasts fun to watch, and few of us would deny there are days when we love it. Hes been at his best when hes come in from the outside: starting Sky News, which shook up a complacent British broadcasting establishment; contradicting conventional American media wisdom that a fourth TV network (Fox) could never get off the ground; reducing the power of Britains printing trade unions that were exercising a stranglehold on the U.K. press. But Murdoch and his global media empire have a lot to answer for. He has not merely encouraged the metastasis of cutthroat tabloid journalism on both sides of the Atlantic. But perhaps just as troubling, authorities in Britain may respond to popular outrage at the scandal by imposing the kind of regulations that cannot help but undermine a truly free press. The events of recent days are a watershed for Britain, for the United States, and for Rupert Murdoch. Tabloid journalismand our tabloid culturemay never be the same. Bernsteins most recent book is A Woman in Charge: The Life of Hillary Rodham Clinton. Correction: This article initially described News of the World as a daily paper.

James Murdoch could face criminal charges on both sides of the Atlantic As phone hacking scandal leaves News Corp open to prosecution, James Murdoch looks less likely to inherit empire By Dominic Rushe and Jill Treanor guardian.co.uk, Friday 8 July 2011 20.18 BST James Murdoch and News Corp could face corporate legal battles on both sides of the Atlantic that involve criminal charges, fines and forfeiture of assets as the escalating phone-hacking scandal risks damaging his chances of taking control of Rupert Murdoch's US-based media empire. As deputy chief operating officer of News Corp – the US-listed company that is the ultimate owner of News International (NI), which in turn owns the News of the World, the Times, the Sunday Times and the Sun – the younger Murdoch has admitted he misled parliament over phone hacking, although he has stated he did not have the complete picture at the time. There have also been reports that employees routinely made payments to police officers, believed to total more than £100,000, in return for information. The payments could leave News Corp – and possibly James Murdoch himself – facing the possibility of prosecution in the US under the Foreign Corrupt Practices Act (FCPA) – legislation designed to stamp out bad corporate behaviour that carries severe penalties for anyone found guilty of breaching it – and in the UK under the Regulation of Investigatory Powers Act 2000 which outlaws the interception of communications. Tony Woodcock, a partner at the City law firm Stephenson Harwood, said section 79 of the 2000 Act enabled criminal proceedings to be brought against not only a company, but also a director or similar officer where the offence was committed with their "consent or connivance" or was "attributable to any neglect on their part". Woodcock said: "This could embrace a wide number of people at the highest level within an organisation, such as a chief executive – not just the individual who 'pushed the button' allowing the intercept to take place or someone (perhaps less senior) who encouraged or was otherwise an accessory to the offence, such as an editor." While the UK phone-hacking scandal has been met with outrage in the US, the hacking itself is unlikely to prompt Washington officials into action. But because NI is a subsidiary of the US company, any payments to UK police officers could trigger a justice department inquiry under the FCPA. The 1977 Act generally prohibits American companies and citizens from corruptly paying – or offering to pay – foreign officials to obtain or retain business. The Butler University law professor Mike Koehler, an FCPA expert, said: "I would be very surprised if the US authorities don't become involved in this [NI] conduct." He said the scandal appeared to qualify as an FCPA case on two counts. First, News Corp is a US-listed company, giving the US authorities jurisdiction to investigate allegations. "Second, perhaps more importantly, the act requires that payments to government officials need to be in the furtherance of 'obtaining or retaining' business. If money is being paid to officials, in this case the police, in order to get information to write sensational stories to sell newspapers, that would qualify," he said. Koehler said the US justice department was increasingly keen to bring cases against individuals as well as companies, because prosecuting people brought "maximum deterrence". He added: "Companies just pay out shareholders' money. There's not much deterrence there." Tom Fox, a Houston-based lawyer who specialises in FCPA cases and anti-corruption law, said most corporate cases were settled before going to court. But for individuals who are successfully prosecuted the penalties are severe. In 2009 the former Hollywood movie producer Gerald Green and his wife, Patricia, were jailed for six months in the first criminal case under the FCPA. The Greens, whose credits included Werner Herzog's Rescue Dawn, were convicted of paying $1.8m in bribes to a government official in Thailand in exchange for contracts to manage the Bangkok international film festival. FCPA charges can carry up to five years in jail for each charge but the Greens' short prison sentence was not the harshest element of their sentencing. The "biggest hammer" prosecutors hold is forfeiture of assets, said Fox. "The Greens lost everything. Their house, savings, retirement plan. They are destitute now." Bringing an FCPA case against the company would be far easier than bringing an action against James Murdoch. As yet there appears to be no evidence that he was directly linked to authorising the police payments. "If you don't know about it, that is a valid defence for an individual," said Koehler. In New York, media executives believe that with or without an FCPA case James Murdoch has already fatally damaged his chances of taking his father's crown. One said: "There has been a sense of unravelling at News Corp for a while. The Daily, MySpace, Project Alesia – they look like News is chasing rainbows. [Rupert] Murdoch is looking old. It affects his ability to appoint an heir and I don't think James even has the backing of his family any more." Speculation is that Chase Carey, the chief operating officer, is most likely to take the top slot when and if the media mogul steps aside. "He is the ultimate Murdoch operative. He is not interested in the trappings of the media business. What would he do? Close the New York Post, sell the Times. Why not? It's a rational thing to do."

Hacking scandal: is this Britain's Watergate? The Independent By Oliver Wright, Ian Burrell, Martin Hickman, Cahal Milmo and Andrew Grice Saturday, 9 July 2011 David Cameron was forced to cut Rupert Murdoch and his newspaper empire loose from the heart of government yesterday as he tried to deflect public anger about his failure to tackle the phone-hacking scandal. Mr Cameron turned on Mr Murdoch's son James, saying there were questions "that need to be answered" about his role during the phone-hacking cover-up, and criticising him for not accepting the resignation of News International's chief executive Rebekah Brooks. He also admitted that his desire to win support from the company's newspapers had led him to turn "a blind eye" as evidence grew of widespread illegality at the News of the World. With a newspaper closed, five arrests and more to follow, 4,000 possible victims, a media empire shaken to its foundations and the Prime Minister reeling, the escalating scandal has become a controversy comparable to the US Watergate saga, with ramifications for Downing Street, the media and police. Last night the media regulator Ofcom announced it would contact police about the conduct of Mr Murdoch's empire in covering up phone-hacking allegations, to determine whether it was a "fit and proper" owner of the broadcaster BSkyB, which Mr Murdoch is attempting to buy outright. He is due to fly into London today to deal with the crisis, according to reports. Shares in the broadcaster fell by eight per cent. In a day of further dramatic developments it emerged that: *Police are investigating allegations that a News International (NI) executive deleted millions of emails from an internal archive, in an apparent attempt to obstruct inquiries into phone hacking. *Andy Coulson was arrested on suspicion of bribing police officers and conspiracy to phone hack, and Clive Goodman, the NOTW's former royal correspondent, was held in a dawn raid on suspicion of bribing police officers. Both were bailed. A 63-year-old man, thought to be a private investigator, was also arrested in Surrey. *Mr Cameron's most senior officials were warned before the last election about connections between Mr Coulson and Jonathan Rees, a private investigator paid up to £150,000 a year to illegally trawl for personal information. But Mr Cameron appointed Mr Coulson as his director of communications. *A judge-led public inquiry will take place to investigate phone hacking. Rupert Murdoch and James Murdoch are prepared to give evidence on phone hacking under oath. *Ms Brooks was stripped of control of NI's internal investigation and faced calls for her resignation from the Deputy Prime Minister Nick Clegg. *Wapping sources warned of worse phone-hacking revelations to come. At a Downing Street press conference, Mr Cameron defended his decision to appoint Mr Coulson but admitted his relationship with senior members of the Murdoch empire had been too close. "The deeper truth is this... because party leaders were so keen to win the support of newspapers we turned a blind eye to the need to sort this issue, get on top of the bad practices, to change the way our newspapers are regulated," he said. "I want to deal with it." Mr Cameron said he now thought it was wrong to keep Ms Brooks at the company: "It has been reported that she offered her resignation over this and in this situation, I would have taken it." Mr Cameron was also asked whether James Murdoch remained a fit and proper person to run a large company, following his admission yesterday that he personally approved out-of-court payments in a way which he now accepted was wrong. The Prime Minister replied: "I read the statement yesterday. I think it raises lots of questions that need to be answered and these processes that are under way are going to have to answer those questions." Mr Cameron announced two inquires: one to deal with phone hacking and the failure of the police to properly investigate it, and another into press regulation. He said it was clear that the Press Complaints Commission had failed and the second inquiry would bringing forward proposals for an independent body. Asked what enquiries he had made before employing Andy Coulson, the Prime Minister said: "Obviously I sought assurances, I received assurances. I commissioned a company to do a basic background check." But the Labour leader, Ed Miliband, said Mr Cameron was still failing to restore confidence in the Government's handling of the scandal: "This is a Prime Minister who clearly still doesn't get it. He is ploughing on regardless on BSkyB. He failed to apologise for the catastrophic mistake of bringing Andy Coulson into the heart of government. "His wholly unconvincing answers of what he knew and when he knew it about Mr Coulson's activities undermine his ability to lead the change Britain needs." Asked if Mrs Brooks should consider her position, Mr Clegg told The Independent: "Yes. The whole senior management has to ask how it could have presided over this without appearing to know what was going on. Someone somewhere higher up the food chain needs to be held to account. You can't just ask journalists, secretaries, photographers and low-paid office workers to carry the can for a failure, on James Murdoch's own admission, of corporate governance." Watergate Parallels The Watergate and phone-hacking scandals had small beginnings – a break-in at a hotel, and a single "rogue" reporter and private detective. The News of the World scandal is not just about phone hacking. It is also about statements made to Parliament, personally to David Cameron, and in a court of law which – as James Murdoch has now admitted – were not true. As with Watergate, which brought down Richard Nixon's presidency, the cover-up could have bigger implications than the original offence.