Rupert Murdoch and the Corruption of the British Media

[Douglas Caddy]

Investors call on News Corp to loosen Murdoch family's grip

News Corp directors urged to abolish stock structure that leaves 'vast majority' of shareholders 'disenfranchised'

By Ed Pilkington in New York

guardian.co.uk,

Thursday 22 December 2011 12.00 EST

News Corporation directors are coming under renewed pressure from investors to loosen the grip of the Murdoch family after one of America's leading bodies on corporate governance called for an end to the company's dual-class stock structure that reinforces Rupert Murdoch's dominance over its affairs.

The Council of Institutional Investors, CII, has written to two News Corp board members, Sir Roderick Eddington and Viet Dinh, to protest at what it calls the disenfranchisement of the "vast majority of News Corporation's owners". The council's letter accuses the directors of allowing a minority of "insiders" to control the media empire by maintaining multiple classes of stock.

That in turn "raises the risks of poor performance and governance and other abuses, since boards at such companies are not accountable to all shareowners".

The council's admonition carries considerable weight because not only is CII a respected voice in the US on good governance, its members also collectively have more than $3tn in assets under management and many of them are News Corp shareholders.

News Corp's dual-track share system has come under mounting fire since the phone-hacking scandal involving the now defunct newspaper News of the World. Under the system, 69.3% of total equity shares are held in the form of 1.8bn Class A shares, yet these are non-voting and effectively stripped of power.

By contrast, just 30.7% of total equity shares are held in the form of 799m Class B shares with voting rights. Rupert Murdoch controls more than 40% of Class B shares, which, when added to the substantial portion of voting shares held by a Murdoch ally, the Saudi Prince Alwaleed bin Talal, gives the family effective control over the company.

The duality has come to be seen increasingly as an affront to the bulk of investors holding non-voting stock. At the annual meeting of News Corp in October, 35% of shareholders voted to remove Murdoch's son James from the board.

James Murdoch has been heavily damaged by the phone hacking scandal, having appeared in front of the parliamentary committee exploring the phone hacking scandal. At the annual meeting, a similar 34% voted against James's older brother Lachlan.

Analysts pointed out that if Rupert Murdoch and Alwaleed were taken out of the equation, the shareholder revolt against the Murdoch brothers would have been closer to 75%.

"Such high 'against' votes signal deep dissatisfaction among unaffiliated shareowners with the company, in particular the ethical and legal breaches that occurred on the directors' watch," the CII's director Ann Yerger wrote in the letter.

The protest raised by CII was backed by the Change to Win investment group, which works with pension and benefit funds sponsored by trade unions that collectively hold over $200bn in assets. The group's governance policy analyst, Michael Pryce-Jones, said: "If the board fails to take action on the year's most resounding vote of no confidence, investors are going to hold them accountable and are going to question the ability of these directors to uphold the interests of shareholders at the other companies on which they serve."

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The whisper is that email hacking could have been more widespread than phone hacking

The Independent

By Cahal Milmo

Monday, 2 January 2012

If 2011 was the year when the words "Operation Weeting" entered the popular lexicon, 2012 is likely to see "Operation Tuleta" added to the list of game-changing police investigations everybody is talking about.

Since it was set up six months ago, Scotland Yard's inquiry into allegations that private detectives were hired by newspapers to target computers of public figures has been overshadowed by Operation Weeting, which deals with the News of the World phone-hacking scandal.

But revelations that police are investigating evidence that emails sent and received by a Chancellor of the Exchequer were illegally accessed – making Gordon Brown the second Labour cabinet minister after Peter Hain to be potentially computer hacked – shows the significance that Tuleta is rapidly gaining.

It also shows how big the next headache to face the Metropolitan Police – and Britain's battered newspaper industry – is turning out to be. Among the cognoscenti of the phone-hacking scandal, there has long been a whisper that Tuleta could show wrongdoing on a scale similar – or greater than – the eavesdropping of voicemails on behalf of the NOTW. Scotland Yard said last month it thought there were about 800 victims of phone hacking. Weeting has 120 detectives and staff. Tuleta is examining nearly 20 computers containing 750,000 documents with a staff of eight officers.

It is also understood that while Weeting is restricted to the activities of a single (shut) newspaper, the computer hacking investigation is looking at the commissioning of private investigators by journalists on several titles.

Questions are being asked of the police as to whether they are deploying sufficient resources in the computer hacking inquiry. Lawyers involved in civil damages claims arising from phone hacking believe an investigation of any email interceptions needs a police operation the size of Weeting.

Edited January 2, 2012 by Douglas Caddy

[Douglas Caddy]

Murdoch's £100m plan to settle hacking cases before they get to court

News International will use legal fund to prevent further revelations

The Independent

Martin Hickman, James Cusick

Thursday, 29 December 2011

Rupert Murdoch's News International is thought to have prepared a legal fund of £100m to settle civil litigation actions brought by victims of the News of the World phone-hacking scandal ahead of a High Court showdown in the new year.

News International is understood to have earmarked the money to settle several high-profile cases, with some claimants likely to receive well above £1m, according to sources close to the situation. The litigation surrender fund is five times the £20m Wapping set aside in April when it ended five years of denial and admitted hacking had been rife at its best-selling paper. Since then the number of hacking cases has jumped from around 20 to about 55.

In total 800 people had voicemails intercepted by the NOTW, according to the Metropolitan Police, indicating that Mr Murdoch's UK newspaper group potentially faces hundreds more claims for damages. Lawyers acting for the existing round of claimants, mostly famous entertainers, sports people and terrorism victims, are thought to be in the final stages of negotiation in several cases, with settlements expected to be imminent.

One senior lawyer told The Independent the inflation in NI's settlement fund "indicates they are serious to avoid further damage in court".

News International appears to be keen to settle as many cases as possible before mid-February when Mr Justice Vos begins to hear a group of test cases – those of the actor Jude Law, the sports agent Sky Andrew, the footballer Paul Gascoigne, the solicitor Graham Shear and Sheila Henry, the mother of a victim of the London 7/7 bombings.

The High Court trials hold the potential to reveal more details of wrongdoing by NOTW and deliver further damaging publicity about the invasiveness of hacking and the distress of victims.

Several of those lead cases are among those thought likely to be settled out of court in coming weeks. Other claimants could be brought in to serve as new test cases, but that is likely to result in a delay which would allow Wapping more time to settle more of those key cases out of court.

Another lawyer said NI was now engaged in a "risk analysis" and was weighing up the overall costs of the trial and the "blueprint" for further damages that would emerge when Mr Justice Vos delivered his verdict.

In all, News International has settled 13 cases, probably at a cost of between £7m and £10m, although the company has declined to confirm numbers settled, outstanding or how much money it has set aside to settle them.

Sources at the company, which closed the NOTW in July, said it was committed to reaching speedy resolutions "with those who have been affected".

Paper money: The payouts so far

Bob and Sally Dowler: £3million

The news that the NOTW hacked into the phone of their missing daughter, Milly, in 2002 disgusted the public in July 2011.

Max Clifford: £1million

One of the non-Royals Mulcaire admitted hacking. A hush payment with a gagging clause.

Gordon Taylor: £425,000 plus £270,000 costs

Glenn Mulcaire admitted in 2006 hacking the phone of the chief executive of the Professional Footballers' Association.

Sienna Miller: £100,000 plus £200,000 costs

The actress had evidence showing her messages had been intercepted for stories about her relationship with Jude Law.

Tessa Jowell: £200,000 plus costs

As a former cabinet minister and key Blairite with important political secrets, Jowell's case was particularly sensitive.

Leslie Ash and Lee Chapman: £100,000 plus costs

The TV presenter and former footballer were alleging the NOTW had hacked their and their children's phones.

[Douglas Caddy]

Gordon Brown's Downing Street emails 'hacked'

Computer crime by press may be as widespread as phone scandal

The Independent

By James Cusick, Cahal Milmo

Monday, 2 January 2012

Police investigating computer hacking by private investigators commissioned by national newspapers have uncovered evidence that emails sent and received by Gordon Brown during his time as Chancellor were illegally accessed.

Mr Brown's private communications, along with emails belonging to a former Labour adviser and lobbyist, Derek Draper, have been identified by Scotland Yard's Operation Tuleta team as potentially hacked material. They are currently looking at evidence from around 20 computers which hold data revealing that hundreds of individuals may have had their private emails hacked.

The links discovered from the seized computers suggest that the email investigation could involve as many victims as those involved in the News of the World phone-hacking scandal.

The eight-strong Tuleta team is looking at the possibility that several Fleet Street titles commissioned specialist private detectives to access computers. News International yesterday declined to comment on the latest allegations.

A source with knowledge of the contents of some of the computers seized from private investigators told The Independent that analysis of a portion of the hundreds of thousands of messages found on the machines showed that Mr Brown and Mr Draper were targeted while the former Prime Minister was Chancellor of the Exchequer. The period includes potentially sensitive episodes in the difficult relationship between Mr Brown and Tony Blair.

One of Mr Brown's former cabinet colleagues, Peter Hain, has confirmed that he held discussions with police officers investigating the potential hacking of his computers during the period when he was Northern Ireland Secretary.

The period discussed with Mr Hain, from 2005 to 2007, overlaps with the period Operation Tuleta is looking at in connection with the Brown-Draper emails. Scotland Yard last night declined to discuss its inquiry into the electronic eavesdropping. A spokesman said: "We are not prepared to give a running commentary on an ongoing investigation."

NI's chief executive, Tom Mockridge, said his company had been advised that Mr Hain's computer equipment "was not and has not been the subject of an investigation by Operation Tuleta" and that there was "no belief or suspicion that this equipment was hacked".

Mr Hain, however, said he had met with the head of Operation Tuleta, Detective Inspector Noel Beswick, and discussed the hacking of three of his computers: two issued by the Northern Ireland Office, and a personally owned machine. The Tuleta team has also interviewed a former Army intelligence officer who has made a formal complaint that his computer was illegally accessed six years ago as part of a search for documents associated with the province's Deputy First Minister, Martin McGuinness.

Mr Brown has previously accused News International of accessing parts of his private life including his bank accounts. He said he "could not understand" why he had the protection and defences of a chancellor or prime minister, and yet remained vulnerable to "unlawful or unscrupulous tactics".

Earlier this year Mr Brown sent Scotland Yard tape recordings which he claimed challenged NI assurances that The Sunday Times had broken no laws when it investigated his personal financial affairs. He told Sue Akers – the Met's Deputy Assistant Commissioner who is leading the phone-hacking and email-hacking investigations – that three senior Sunday Times journalists, whom he named, were aware of the "blagging" techniques used to access his personal details.

Mr Draper, a former lobbyist and former assistant to Lord Mandelson, has found his private correspondence being published on two occasions that have damaged the Labour Party and the reputation of Gordon Brown.

In 2008 a sequence of email exchanges between Mr Draper and Lord Mandelson damaged a planned make-over of Mr Brown's reputation during his difficult time as Prime Minister. In the leaked emails, Mr Brown was described as a "self-conscious person, physically and emotionally" and someone "not comfortable in his own skin". In 2009 leaked emails between Mr Draper and Gordon Brown's head of strategy and planning, Damian McBride, offered a series of planned smears targeted at David Cameron and George Osborne. It was suggested that the Tory leader could be falsely branded as having an embarrassing medical condition, and that Mr Osborne, then shadow Chancellor, could be alleged to have taken drugs with a prostitute. Although all the allegations were nonsense, Mr Draper, then re-emerging as a prominent pro-Labour blogger, wrote back to Mr McBride saying "Absolutely totally brilliant Damian."

There is no suggestion that any of this material was accessed through illegal computer hacking techniques.

Contacted by The Independent, Mr Draper said he had been given no details by Scotland Yard about whether his emails had been hacked. Mr Brown did not respond to a request for comments.

[Douglas Caddy]

Poster's note: This is bad news, indeed. It appears that Obama and his political Justice Department have decided to do nothing about the phone hacking in the U.S. by Murdoch. It may be that Obama & Co. have decided that to do so could adversely affect Obama's chances of being reelected; or it may be, as with their decision not to prosecute Wall Street and the Big Banks for the trillion dollar frauds they committed, that their natural interests lie with covering up the criminality.

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9/11 Relatives Who Suspect Hacking Await Answers

The New York Times

By DON VAN NATTA Jr.

January 2, 2012

Shortly after the Sept. 11, 2001, terrorist attacks, relatives of some of the victims began suspecting that someone was eavesdropping on their telephones.

Some heard mysterious clicking sounds on their home and mobile phones. The fiancée of one man who died at the World Trade Center remembers listening to snippets of someone else’s conversation on her line. A husband of another victim recalls hearing somebody remotely accessing his home answering machine, which still held the final, reassuring message left by his wife shortly before the crash of Flight 93. Others say they are baffled as to how details about their loved ones appeared in British tabloids within days of the attacks.

Ten years later, their long-held suspicions aroused by The News of the World phone-hacking scandal in London, dozens of relatives of victims contacted the Justice Department. On Aug. 24, eight of them met with Attorney General Eric H. Holder Jr. and asked him to determine whether their privacy had been violated. As a first step, they asked him to see whether Scotland Yard had a record of their names or phone numbers among the material seized from a private investigator who hacked cellphone messages for the tabloid.

Four months later, they are still waiting to hear back and are frustrated by the Justice Department’s silence.

“It’s not that hard to find out — it’s quite a simple thing, really, isn’t it?” said Patricia Bingley, a British citizen whose son, Kevin Dennis, a 43-year-old trader at Cantor Fitzgerald, worked on the 101st floor of the World Trade Center’s north tower.

Ms. Bingley said she was stunned to see, in the Sept. 18, 2001, issue of The Sun, a photograph of her son reading a bedtime story to his two sons, which she did not give to the paper. The story also contained details about her son that she said no one from her family had provided to The Sun. “It never made sense to me,” she said, adding that she suspects hacking or worse by the paper. “I’d like very much for the government to tell us whether this happened or not. Celebrities seem to have no trouble finding out.”

In July, as revelations about widespread phone hacking by the tabloid were spilling out, another British newspaper, The Daily Mirror, reported that a private investigator said that News of the World reporters had offered to pay him to retrieve phone records of Sept. 11 victims. After the report, which was not confirmed by other news organizations, the Justice Department opened an investigation. To date, no evidence has emerged publicly that Sept. 11 victims were hacking targets.

Jodi Westbrook Flowers, a lawyer at a South Carolina firm that represents more than 6,700 relatives of Sept. 11 victims, said she and her colleagues had scoured the British tabloids and found scores of details about the victims. Relatives were not certain how the tabloids found out so much so quickly after the attacks.

One of the relatives, whom she declined to identify, said that five days after Sept. 11, The Sun published the words from a voice mail message left on his cellphone by his son, who was aboard one of the planes that hit the World Trade Center. (British authorities are also investigating whether hacking occurred at The Sun, which, like The News of the World, is owned by News Corporation.)

In late September, Ms. Flowers, of the Motley Rice law firm, sent Mr. Holder phone numbers of two dozen relatives of victims and asked that Scotland Yard run them through the 12,000 pages of documents seized from the home of Glenn Mulcaire, the private investigator responsible for most of the hacking by the now-shuttered News of the World. She said at least 100 of her clients, in both the United States and Britain, now want similar information.

On Nov. 3, Vida G. Bottom, chief of the Justice Department’s public corruption unit, wrote to the lawyers, saying, “The F.B.I. has undertaken a preliminary review to assess the veracity of those allegations.”

Ms. Flowers said she was disappointed by the vagueness of the response. “We asked a simple threshold question, and we basically received a nonanswer,” she said.

Ms. Flowers added, “If there was no hacking, it is wildly coincidental that so many people describe similar experiences.”

Even so, two Justice Department officials with knowledge of the inquiry said they did not expect much to come of the investigation. The officials, who declined to be identified because they were not authorized to discuss a continuing criminal inquiry, said the investigation remained open in case Scotland Yard discovered evidence confirming the suspicions of the Sept. 11 relatives. They both said they were doubtful such evidence would emerge.

Tracy Schmaler, a Justice Department spokeswoman, said only, “It’s an ongoing investigation.”

Norman Siegel, a lawyer for nearly two dozen victims’ families who also attended the meeting with Mr. Holder, said, “As far as I know, there is still serious interest in this investigation not only by the Department of Justice and the F.B.I. but by Attorney General Holder himself.” He said he understands his clients’ frustration, but remains optimistic they will ultimately believe their suspicions have been investigated “in good faith.”

A determination that the relatives of Sept. 11 victims were hacked would add a new, explosive twist to the scandal, particularly if they are in the United States. The confirmed cases of hacking — which extend to celebrities, government officials and crime victims — have all been confined to Britain.

Many of the instances recounted by relatives of victims do not fit the pattern of the confirmed hacking cases, in which cellphone messages were illegally accessed in pursuit of tabloid stories. But even if they cannot point to subsequent tabloid stories, the relatives with memories of the odd occurrences after the attacks are eager for an answer from the Justice Department.

Lorie Van Auken, whose husband, Kenneth Van Auken, died in the World Trade Center, said she noticed clicks on her home phone line for months after the attacks and overheard cross-talking voices. “It is mystifying,” she said of the Justice Department’s silence. “This is a peace of mind issue. We just want to know the truth.”

In interviews, more than a half-dozen relatives of Sept. 11 victims reported having suspicions that someone had gained illegal access to their phones.

Jack Grandcolas, whose wife, Lauren Grandcolas, was aboard Flight 93, which crashed in Shanksville, Pa., said that one night several months after her death, his home telephone rang and he listened as the answering machine played previously recorded messages, apparently through a password-enabled command. “It was as if the phone had been accessed by someone,” he said.

Among the messages was the one his wife left from the plane saying: “I’m totally fine. I just love you more than anything, just know that. And you know, I’m, you know, I’m comfortable and I’m O.K. — for now. Just a little problem.”

Years later, that message appeared on YouTube accompanied by a laugh track. Although Mr. Grandcolas said he allowed two documentary producers to use the message, his memory of the answering machine episode and clicking sounds he heard on his phone after the attacks made him wonder if he was a victim of hacking.

Lucy Aita, whose fiancé, Paul Innella, 33, of East Brunswick, N.J., died in the World Trade Center, said she also recalls clicking sounds on her telephone for months after the attacks.

“Every time we picked up the phone, we heard a little clicking noise that was intermittent,” she said. “Then we started hearing voices of people, as if they were on a speaker phone. A few times we’d say, ‘Can you stop listening to us, please?’ Then all of the sudden, we’d hear a click and they would be gone.”

Charlie Savage contributed reporting.

[Douglas Caddy]

New York Daily News Picks as Editor Colin Myler, Formerly of News of the World

The New York Times

By AMY CHOZICK and RAVI SOMAIYA

January 5, 2012

Toby Melville/ReutersColin Myler, the new editor of The Daily News in New York.The Daily News of New York on Wednesday appointed Colin Myler, a former editor of the recently closed News of the World tabloid in London, its editor in chief.

Effective on Tuesday, Mr. Myler, 59, will succeed Kevin Convey, a former editor of The Boston Herald who has led The Daily News since 2010.

“The New York Daily News is a great institution of American journalism which will only get better under the leadership of Colin,” the newspaper’s publisher and chairman, Mort Zuckerman, said in a memo to the staff.

The new position will pit Mr. Myler against his former employer, Rupert Murdoch, whose News Corporation owned News of the World. It still owns The New York Post, the News’s fierce tabloid rival, where Mr. Myler served as managing editor for five years under the editor Col Allan.

“Colin Myler will lead our print and digital platforms into the next generation of newspaper publishing,” Bill Holiber, president and chief executive of The Daily News, said in a statement.

Mr. Myler was brought in to run News of the World in 2007 after the first flurry of the phone-hacking scandal that eventually led to the closing of the paper, a 168-year-old tabloid, in the summer.

A reporter for the tabloid and a private investigator the reporter hired to illegally intercept the voice mail messages of the royal family and their aides had been jailed. Mr. Myler was seen, reporters at the newspaper have said, as a safe leader to pilot the publication through treacherous waters.

Mr. Myler, said the reporters, who did not want to be named discussing internal matters for fear of jeopardizing severance arrangements, was thought of in the newsroom as a cautious but sharp operator, his instincts honed over years at Britain’s tabloid newspapers and at The New York Post. He inspired fierce loyalty in many of his employees.

But when the hacking scandal escalated last year, Mr. Myler, along with the legal manager, Tom Crone, turned on James Murdoch, the son of the News Corporation chief executive, Rupert Murdoch, after he testified that he had not been informed of the full scope of hacking at the paper. Mr. Myler and Mr. Crone asserted in a brief statement that James Murdoch had seen crucial evidence that pointed to more widespread illegality at the tabloid before he decided to pay a $1.4 million settlement, which included a confidentiality clause, in a legal case that might have exposed the full extent of the practice.

Mr. Myler and Mr. Crone have since been in a terse war of words with their former boss. They have held their ground, while Mr. Murdoch denies their account, and any wrongdoing, and has said he agreed to the settlement only because it made financial sense.

[Douglas Caddy]

Phone hacking: police arrest Rebekah Brooks's PA

Daily Telegraph

12:22PM GMT 06 Jan 2012

Police investigating the hacking of mobile phones at the News of the World have arrested Cheryl Carter, the long-serving personal assistant to former editor Rebekah Brooks.

Ms Carter, 47, is being investigated over allegations emails at News International were deleted and is being held at an Essex police station.

She was arrested at her home on suspicion of attempting to pervert the course of justice.

Ms Carter has worked as beauty editor at The Sun and launched a cosmetics line, Famous, with colleague Sue Moxley. Her most recent column for the newspaper was written in early November 2011.

Ms Carter was a secretary to Rebekah Brooks when she was the deputy editor of The Sun and editor of the News of the World. She moved with her when Ms Brooks was promoted to chief executive of News International.

She is understood to also have worked for Neil Wallis, the former executive editor of the News of the World, and Stuart Kuttner, the tabloid's managing editor of 22 years.

A Scotland Yard spokesman said: "The woman was arrested at approximately 6.55am. She is currently in custody at an Essex police station."

She is the seventeenth person arrested under Operation Weeting's probe into mobile phone interceptions, Scotland Yard said.

She is the first Weeting arrest since private investigator Glenn Mulcaire was released on bail until March over allegations of phone hacking and perverting the course of justice.

Phone-hacking detectives working their way through 300 million emails from News International have arrested a series of high-profile figures, including former Downing Street communications chief Andy Coulson.

Ms Brooks was arrested in July over allegations of phone hacking and of bribing police officers

[Douglas Caddy]

Investors brush off News Corp hacking saga

Financial Times

January 6, 2012

By Andrew Edgecliffe-Johnson in New York and Ben Fenton in London

In the six months since the revelation that the News of the World accessed a murdered teenager’s voicemail messages, the scandal has cost Rupert Murdoch the British tabloid he bought in 1969 his bid for full control of British Sky Broadcasting, some of his closest executives and, perhaps, his dream of family succession.

Yet, in Wall Street’s eyes, it is as though nothing happened. This week, shares in News Corp hit a 52-week high, edging past the peak at which they stood before the Milly Dowler report upended Britain’s media, police and political establishment.

“It’s a very straightforward stock right now,” says Michael Nathanson, media analyst with Nomura. Of the hacking scandal, he says: “The Street is looking through it. There are legal costs, potential payments and obviously a huge controversy, but it’s seen as a one-off.”

Analysts cite four reasons why the scandal has not had a bigger impact on the stock: generous share buy-backs, hopes that newspapers will become a smaller part of the group’s future, robust growth in the rest of the business and faith in the non-family member first in line to succeed Mr Murdoch, Chase Carey.

Just days after the Milly Dowler story broke, News Corp added $3.2bn to its buy-back programme, lifting the target for repurchases to $5bn. Investors had pressed Mr Murdoch for several years to spend more on buy-backs, fearing that News Corp’s plentiful cash would otherwise be spent on unexpected deals such as MySpace and Dow Jones, some of which led to heavy losses.

Acquisitions remain a possibility, as News Corp has been eyeing deals in areas as diverse as Formula 1 motor racing and education. But much of the stock’s rally can be explained by the fact that News Corp has now spent $2.5bn buying back 151.07m class A shares between $14.73 and $18.39, just below $18.49 Thursday close.

Analysts are already hoping for more. Morgan Stanley expects another $5.5bn of repurchases in 2012, equivalent to 11 per cent of the current market capitalisation, and Mr Nathanson says: “They’re not going to let cash build up on the balance sheet. They’re half way through the buy-back, and everyone’s going to wait and see if there’s a phase two.”

Investors had welcomed News Corp’s bid for the 60.9 per cent of BSkyB it does not already own, as the group has been unable to reflect the UK satellite broadcaster’s prodigious cash flow fully in its accounts, but saw buy-backs as even better use of cash.

The scandal over allegations of phone hacking and payments to police has resulted in the demise of the News of the World and forced News Corp to withdraw its bid for full control of BSkyB.

In addition, with the News of the World’s closure, “you got a decreased emphasis on newspapers and a change of regime in the UK newspapers with Tom Mockridge coming in [from Sky Italia] with a fresh pair of eyes to look at the business structure”, Mr Nathanson says.

For every negative headline on newspapers, investors have found a positive story elsewhere. In its first fiscal quarter, strength in cable networks such as FX and Fox News and rising fees from cable and satellite distributors for the Fox broadcast network drove operating income up 21 per cent to $1.39bn.

Fox News should enjoy further growth in an election year, and the return of American Idol for an 11th season this month is keeping hopes for the Fox broadcast network high. The performance of the television assets has bolstered the positions of Roger Ailes, president of Fox News, and Mr Carey, News Corp’s chief operating officer.

Investors would rather see Mr Carey, a well-regarded operator, succeed Mr Murdoch than one of his family, and the hacking scandal has shaken expectations that James Murdoch, deputy chief operating officer and head of News Corp’s European and Asian operations, was first in line to the throne.

The younger Mr Murdoch is waiting for a parliamentary report, due in early February, about what he knew and when he knew about how widespread voicemail interception had been at the News of the World.

He told MPs in July he had not been briefed on the settlement of a phone-hacking suit in 2008 that kept the scandal buried for another year, but his position has been challenged by two former senior colleagues.

Mr Murdoch has twice had to inform the MPs’ committee of new evidence that suggests he could have known more than he first told them, although he denies misleading the committee and remains adamant that he did not read an email trail that would have given him much more knowledge.

He has survived protest votes at BSkyB and News Corp, but a damning report from MPs could put him under further pressure to stand down as chairman of the satellite company. From investors’ viewpoint, the future of News Corp’s 39.1 per cent stake in BSkyB is the bigger issue.

Having abandoned the bid amid a political uproar, News Corp’s ability to renew its pursuit looks highly limited, raising the question of whether it might sell the prized asset.

“There will be no bid for at least two years,” said Claire Enders, UK media analyst. “[in] the current political climate, the coalition [government of the UK] will just not let this happen. But I don’t think News Corp will ever give up on total ownership of Sky.”

Analysts agree it is reluctant to sell, but Mr Carey said in December that the issue is one “we need to continue to figure out” as News Corp was not getting “a fraction of the credit for that $15bn” stake. The group preferred to own assets outright or “monetise” them, he said pointedly.

Questions also remain as to how long News Corp will maintain its UK newspapers, with circulation dwindling even at the profitable Sun and both The Times and Sunday Times struggling to replace decreasing circulation and advertising revenues with digital subscriptions. People close to the company see little appetite for spinning off newspapers, but the question is not the taboo it once was.

The UK hacking saga remains an unpredictable risk, however. More than 20 people have been arrested under two UK police investigations, the latest of them on Friday morning.

With a series of police, parliamentary, judicial and regulatory reports due out in the UK this year, and uncertainty about whether the scandal could yet pull in US authorities, investors would be rash to assume that 2012 will be free of the damaging headlines that dominated 2011.

[Douglas Caddy]

Poster's note: This is an outrage!

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Yard chiefs who quit over phone hacking 'are given £500,000 in secret cash pay outs'

By Chris Greenwood

Daily Mail

Last updated at 8:59 AM on 7th January 2012

Two of Britain’s most senior police officers pocketed substantial pay-offs after resigning over the phone-hacking scandal, the Daily Mail can reveal.

Former Scotland Yard Commissioner Sir Paul Stephenson and his colleague John Yates are thought to have received up to £500,000 between them.

The cash was handed out after the pair signed gagging orders which bar them from suing the Metropolitan Police or speaking about their treatment.

The exact size of the payments, at a time of savage cuts to police budgets, was a closely guarded secret.

But speculation was mounting that the total cost to the taxpayer, including fees racked up during weeks of legal wrangling, could be as much as half a million pounds.

The pay-offs underline how the scandal plunged the Met leadership into chaos amid a flurry of revelations about their close links to News International.

The force is now braced for further criticism after the Audit Commission, a public spending watchdog, ordered a review of how the pay-offs were agreed.

Critics highlighted how both officers appeared to have been handsomely rewarded despite choosing to leave as a result of their own failings.

But supporters said the payments reflected the shambolic way in which they were treated as the force’s political leaders panicked.

Jenny Jones, a member of the MPA, said the payments were ‘completely wrong’.

She added: ‘When people resign they should just go, there is no question of a severance package or settlement deal.

‘They went because of their mistakes and should accept that. ‘It is wrong for any public organisation to be so secretive about something that is in the public interest and involves public money.’

The payments were agreed by lawyers at the soon-to-be-abolished MPA, which is a separate organisation from the Met. At first officials there insisted that as both officers made a ‘personal decision’ to resign they were entitled only to their pensions.

But after being confronted with evidence of ‘termination payments’ by the Mail, they were forced to admit money had been paid.

The MPA refused to reveal how much the deals were worth but said the amount will be published in its annual accounts later this year.

Sir Paul, who earned £276,000 a year, resigned after admitting taking a £12,000 five-week freebie at a luxury health spa while he recovered from a cancer scare.

Difficult questions were raised after it emerged that the spa was promoted by former News of the World executive and hacking suspect Neil Wallis.

Mr Wallis was also hired as a consultant by the Met’s communications director, who remains on ‘extended leave’ over the £24,000 contract.

Mr Yates resigned from his post as Britain’s top anti-terrorism officer, with a £200,000 salary, several weeks later. He admitted being a close friend of

Mr Wallis amid claims he improperly helped to secure a civilian job for the journalist’s 27-year-old daughter at Scotland Yard. Both officers were later cleared of any misconduct after an inquiry by the Independent Police Complaints Commission (IPCC).

Mr Yates is now preparing to move to Bahrain where he will advise the Government on police reform.

A Metropolitan Police Authority spokesman said: ‘Both Sir Paul Stephenson and John Yates signed compromise agreements at the request of the Authority to prevent any future disputes.

‘Payments made and recorded in those compromise agreements were based on their contractual entitlements.’

Sir Paul and Mr Yates declined to comment.

A Met spokesman said: ‘This is entirely a matter for the Police Authority.’

Read more: http://www.dailymail.co.uk/news/article-2083276/Scotland-Yard-chiefs-quit-phone-hacking-given-500k-secret-cash-pay-outs.html#ixzz1infq0yax

[Douglas Caddy]

Latest Hacking Scandal Arrest Suggests Focus on Cover-Up

The New York Times

By JOHN F. BURNS

January 8, 2012

LONDON — Scotland Yard’s arrest of a former personal assistant to Rebekah Brooks, a former chief executive of the British newspaper arm of Rupert Murdoch’s News Corporation, appears to reflect the investigators’ intensifying focus on the possibility of a cover-up by executives, editors and others of the extent of illegal phone hacking and other criminal wrongdoing at the The News of the World, which is now defunct.

After 10 hours of questioning on Friday, detectives assigned to a special unit investigating the affair released the assistant, Cheryl Carter, 47, on police bail pending further questioning. She was arrested at dawn at her home in Billericay, 25 miles east of London. Efforts to reach her for comment on Saturday were not successful.

Scotland Yard said she was the 17th person, most of them former employees of the The News of the World, to be arrested by officers assigned to Operation Weeting, established last year under special provisions intended to ensure the independence of the investigators.

The creation of that task force followed several years of faltering inquiries by Scotland Yard that upheld, until a torrent of disclosures last year, denials by News International that more than two people on the News of the World’s newsroom staff had been involved in the illegal interception of the cellphone voicemails of crime victims, politicians and celebrities.

As the scandal grew last year, dominating headlines in Britain for months, the police inquiry, and hearings by a parliamentary committee, began to focus on allegations that executives, editors and others involved had conspired to cover up the extent of the wrongdoing, which Scotland Yard said last month had involved the hacking of the cellphones of at least 800 people.

One of the executives who has been under pressure is James Murdoch, Rupert Murdoch’s son, who leads News Corporation’s European and Asian operations, and has long been considered a candidate to succeed his father as head of the company. The police investigation and testimony before a parliamentary committee identified a 2009 meeting in London attended by James Murdoch as crucial to unraveling the issue of whether senior executives conspired in the cover-up.

Under questioning at two sessions before the committee last year, James Murdoch denied having approved an out-of-court settlement of more than $1.4 million to buy the silence of a British soccer union executive who was suing News International and threatening to go public with documents pointing to a wider use of phone hacking than the company had then admitted. Two other senior Murdoch employees contested Mr. Murdoch’s denial, saying that they had informed Mr. Murdoch of the extent of the phone hacking, and cited that as a reason for approving the settlement. One of the two, Colin Myler, the former editor of the The News of the World, was appointed editor last week of The Daily News in New York, a rival of the Murdoch-owned New York Post.

Ms. Carter’s arrest drew attention for several reasons, including a Scotland Yard statement that said that she had been questioned on suspicion of trying to pervert the course of justice, a line of inquiry that has not been specified in police statements on most of the other arrests in Operation Weeting.

In addition, Ms. Carter appeared to have had a close personal and professional relationship with Ms. Brooks, the most senior executive in the Murdoch hierarchy to have been arrested in the affair. Former News of the World employees who spoke on condition of anonymity said Ms. Carter had worked as a personal assistant to Ms. Brooks for 19 years, starting when Ms. Brooks was deputy editor of The Sun, another Murdoch-owned tabloid in London, and continuing as Ms. Brooks became editor of the The News of the World, editor of The Sun, and later chief executive of News International, overseeing all of the Murdoch titles in Britain.

Ms. Brooks’s resignation in July followed closely the News Corporation’s abrupt decision to close News of the World, Britain’s highest-circulation Sunday newspaper, after 168 years of continuous publication.

Ms. Carter, who was described by those who worked with her as Ms. Brooks’s “gatekeeper,” with close knowledge of Ms. Brooks’s schedule, e-mails and meetings, lost her job as personal assistant amid the storm of recriminations after the disclosure that one of those whose cellphones had been hacked was Milly Dowler, a 13-year-old girl who was abducted and murdered in an outer London suburb in 2002.

News International’s acknowledgment that the The News of the World had hacked into the teenager’s phone at a time when there was still hope that she remained alive, and deleted messages left by her family and friends so as to make room for others, was a watershed in the scandal. Ms. Carter’s departure from News International closely followed that of Ms. Brooks, but Ms. Carter continued to write a weekly beauty column for The Sun until that, too, was discontinued in December.

One of the issues under investigation by Scotland Yard is whether any documents or e-mails pertinent to the inquiry were deleted or destroyed as part of a cover-up. Although News International has provided investigators with an archive of 300 million e-mails, the company has been accused of having deleted e-mails and of providing former employees with lavish payouts on the condition of their silence. It has also been accused of making selective leaks to other sections of the news media that Scotland Yard suggested constituted a “deliberate campaign to undermine the investigation.”

According to two former staff members who did not want to be named because they were discussing a topic that was the subject of an active police investigation, Ms. Carter was fiercely loyal to Ms. Brooks. A person who claimed to have been present on the day that Ms. Brooks cleared out her office at News International’s headquarters, and who spoke on condition of anonymity, said that the two women were seen carrying items to a parked car.

[Douglas Caddy]

Jan 9,2012, 2:09 PM EST

Reporters defend tabloids at UK media inquiry

By JILL LAWLESS

Associated Press

LONDON (AP) -- Reporters and editors from Britain's Sun tabloid painted their newspaper as a moral paragon Monday, saying accuracy was paramount and privacy always a consideration, while the paper's legal counsel insisted he had seen no evidence of phone hacking.

Lawyer Justin Walford, counsel to Rupert Murdoch's News Group Newspapers, told Britain's media ethics inquiry that he would be surprised and shocked to learn that The Sun was guilty of illegal eavesdropping like its now-defunct sister paper, the News of the World.

"I've never seen anything at The Sun which has made me think that it has been happening," Walford said.

The phone-hacking scandal has engulfed the News of the World - shut down by Murdoch in July - but some alleged victims have accused other newspapers of wrongdoing, too. The Sun, Britain's best-selling newspaper, faces a lawsuit from actor Jude Law for allegedly listening to his voice mails.

The Sun's current editor, Dominic Mohan, said in a written statement to the inquiry that he had "always been determined to foster a culture of honesty, integrity and high ethical standards at the Sun." Showbiz editor Gordon Smart said Sun staff "act ethically and we act responsibly at all times."

But an outspoken former Sun editor said standards had been looser in his day.

Kelvin MacKenzie, who ran the newspaper between 1981 and 1994, said he never considered privacy, and stood by his earlier description of his fact-checking policy as "if it sounded right, it was probably right and therefore we should lob it in."

MacKenzie, the first in a string of past and present newspaper editors due to appear this week, gave a robust defense of media muckraking, saying tabloids are the victim of snobbery and double standards in the media.

"There is a tremendous amount of snobbery involved in journalism," MacKenzie told the inquiry, arguing that a tabloid would be punished for using underhanded investigative techniques, while a more highbrow paper would not.

He gave the hypothetical example of "if you had Tony Blair's mobile number and you hacked into it and discovered that he was circumventing the Cabinet in order to go to war."

"If you publish it in The Sun, you get six months in jail," MacKenzie said. "If you publish it in The Guardian, you get a Pulitzer."

Prime Minister David Cameron set up the judge-led inquiry last year after evidence emerged that the News of the World tabloid eavesdropped on the cell phone voice mail messages of celebrities, politicians and crime victims to get stories.

The case has triggered soul-searching about the balance between media freedom and individual privacy. MacKenzie said that he had not given much thought to privacy when he was The Sun's editor.

He said he took "the First Amendment approach, the American approach" to journalism.

"I basically took the view that most things as far as I could see should be published," MacKenzie said.

Britain does not have the same constitutional free-speech protection as the United States, and the U.K.'s libel laws are more weighted in favor of plaintiffs than those of many countries. Britain's tabloids regularly pay out substantial sums to settle libel suits from celebrities.

MacKenzie presided over one of The Sun's most colorful periods, a time of celebrity scandal and credibility-stretching headlines including "Freddie Starr Ate My Hamster," which made an unlikely allegation against a British comedian.

He acknowledged the newspaper sometimes got things wrong, as when it had to pay 1 million pounds and make a front-page apology to Elton John in 1988 for stories about his personal life.

"Journalists try to get things right," he said. "People tell you lies."

The hacking scandal exploded after The Guardian reported in July that the News of the World had eavesdropped on the voice mails of missing 13-year-old Milly Dowler in 2002, and may have hampered the police search for her by deleting messages. She was later found murdered.

It has spawned a huge police investigation and seen top police officers, media executives and the prime minister's communications chief - an ex-News of The World editor - all resign their posts.

But rumors of voice mail eavesdropping circulated in the media for years before the Dowler case made them front-page news.

Testifying to the inquiry Monday, Mohan confirmed that at a 2002 awards ceremony he thanked "Vodafone's lack of security" for exclusive stories obtained by the Daily Mirror, a rival paper edited by Piers Morgan. Mohan said the quip referred to the reputed ease of hacking into voice mails using factory-set passcodes.

"I think it was well known," he said, adding that he had made the remark "as a joke to undermine the Mirror's journalism."

Inquiry chief Lord Justice Brian Leveson said Monday that he was expecting the results of a police review into one of the most shocking details in the hacking saga - the deletion of messages from Dowler's phone.

Last month a police lawyer said one element of The Guardian's story had been wrong - it was unlikely anyone from the tabloid had deleted Dowler's messages.

Since then the Murdoch-owned press has been sharply critical of The Guardian, saying the error showed that the News of the World was shut down for a crime it did not commit. The Guardian says its allegations about phone hacking were largely correct.

The judge said his inquiry into media malpractice would continue whatever the police review showed.

"Whatever the outcome of this new evidence I have no intention of suggesting either to the home secretary or to the secretary of state for culture, media and sport that as a result this inquiry is no longer justified," he said.

---

Online: http://www.levesoninquiry.org.uk

Jill Lawless can be reached at: http://twitter.com/JillLawless

[Douglas Caddy]

MPs divided over calling on Brooks to clarify Clifford payout evidence

The Independent

By Jonathan Brown

Monday, 9 January 2012

Showdown imminent over whether MPs need to hear new testimony from former NI boss

A meeting between members of the parliamentary inquiry investigating phone hacking at Rupert Murdoch's News International will take place this week amid mounting tensions over its future direction.

Members of the House of Commons Culture, Media and Sport Select Committee hold conflicting views of the scandal, with some MPs seeking fresh evidence from at least one senior Wapping figure – the News International former chief executive Rebekah Brooks.

A first draft of the MPs' long-awaited report was produced before Christmas. There will be calls tomorrow for Ms Brooks to be asked to explain her role in authorising a £1m payment to the publicist Max Clifford in 2010 for having his phone messages intercepted.

The money was paid at a time when the company was still insisting hacking was limited to a single royal reporter.

While it is unlikely that Ms Brooks, who is currently the subject of a police investigation into the affair, will be recalled as a witness, MPs are expected to seek written clarification of what she knew about the payment.

She gave evidence to the committee in July immediately after Rupert and James Murdoch.

Operation Weeting detectives investigating phone hacking arrested Ms Brooks's former assistant at her home in Essex last week.

Allegations of phone hacking will again be centre stage today when the editor of The Sun, Dominic Mohan, and one of his most famous predecessors at the tabloid, Kelvin MacKenzie, who has since defected to the Daily Mail, give evidence to Lord Leveson's inquiry into press standards.

Two of the senior figures from the committee, Labour's Tom Watson and the Conservative MP Louise Mensch, have denied they are clashing in a so-called "Beauty versus the Beast" row over how much blame should be apportioned to James Murdoch in the final report. In his second appearance before MPs in November, Mr Watson compared the News International chairman to a "Mafia boss" while Mrs Mensch has praised the consistency of Mr Murdoch's evidence.

Mr Watson said he would be reviewing the written and oral evidence today before deciding whether to press for more witnesses to be called.

While there is a growing consensus among the committee to move towards a conclusion, Mr Watson said there was a "distinct possibility" of fresh hearings.

This is despite the suggestion by the Conservative chairman of the committee, John Whittingdale, who has previously indicated that enough testimony had been heard.

Among the other key issues likely to dominate MPs' discussions tomorrow are the credibility of Mr Murdoch and the former News of the World executives the former editor Colin Myler and legal manager Tom Crone, who dispute his testimony about how much he knew before he sanctioned a £700,000 payout to the phone-hacking victim Gordon Taylor. New emails emerged last month which appeared to question James Murdoch's assertion that he received little briefing from News of the World executives prior to authorising the settlement to Mr Taylor, the chief executive of the Professional Footballers' Association. News International said the emails were consistent with Mr Murdoch's testimony.

The Labour MP Paul Farrelly, who sits on the committee, said it was important that the final report was not hurried: "The first draft of the report appeared just before Christmas and it will need lengthy discussion. This is in order to get it right, and make sure it stands the test of time, given that the police and judicial inquiries are likely to unearth further evidence."

[Douglas Caddy]

Leveson Inquiry: Daily Telegraph expenses investigation was justified and worthy of praise

Daily Telegraph

2:49PM GMT 10 Jan 2012

The Daily Telegraph’s investigation into the scandal of MPs’ expenses was justified due to its significant public interest journalism, according to Lionel Barber, the editor of the Financial Times.

Mr Barber told the inquiry into press standards that the revelations that culminated in the News of the World's closure in July amounted to a 'shocking episode' Photo: Getty2:49PM GMT 10 Jan 2012

Mr Barber told the Leveson Inquiry into journalistic standards that the newspaper was within its rights to pay for a controversial disc containing the relevant data because of the criminal behaviour it had illuminated.

The FT’s editor lauded the Telegraph’s investigation and the multiple stories which it generated, which led the news agenda for months and transformed British politics.

Mr Barber said: “Yes they paid for the disc but the journalism and series of articles they did clearly met the public interest test.

“I have absolutely nothing but praise for that particular story.”

The editor also said that the phone-hacking scandal was a "wake-up call" that made British newspaper executives realise they must change how the industry is regulated, the Financial Times's editor said today.

Mr Barber told the inquiry into press standards that the revelations that culminated in the News of the World's closure in July amounted to a "shocking episode".

He called for the formation of a new independent press regulator with powers to impose fines, require corrections to be published prominently and launch investigations.

Mr Barber told the hearing: "This has been a real shock, what happened at the News of the World, not just in terms of the extent, the industrial scale of phone hacking, but the pattern of lies.

"But also the result, which was shocking: the closure of a national newspaper with a circulation of several million, and a newspaper actually that has done in its own way over the years some very good stories - I am thinking of the fixing in the Test match.

"This was a shocking episode. All of us, I speak for myself, believe that as a result we need to change the way we do business.

"If this isn't a wake-up call, I'm not sure what is."

Mr Barber, who became Financial Times editor in 2005, said the new press regulator had to be compulsory and should be something that online news sites such as the Huffington Post would want to join.

"It is incumbent on the industry to produce new credible proposals for independent regulation," he said.

"That's the lesson of the phone-hacking scandal, and to a degree it's the lesson of what's already come out in this inquiry."

But he told the inquiry that any change to oversight of the media must take in the whole “news ecosystem”, including websites, bloggers, and sites which collect other people’s material.

He said: “It would be a huge mistake for the inquiry to focus just on the press.”

Mr Barber’s comments echoed those of Dominic Mohan, the editor of The Sun, who yesterday urged the inquiry to help ensure a “level playing field” for what could be reported.

He claimed that the FT was the “gold standard” of journalism but acknowledged that it did not always pursue the same stories as other papers.

He added that, in his personal view, it was wrong for the Telegraph to use journalists to pose as constituents in exposing the views of Vince Cable, the Business Secretary, who disclosed that he had “declared war” on Rupert Murdoch’s bid to take over the television firm BSkyB.

[Douglas Caddy]

Leveson Inquiry: Gordon Brown 'told Rupert Murdoch he would destroy his company'

Daily Telegraph

By Andy Bloxham

4:39PM GMT 09 Jan 2012

Rupert Murdoch said a “furious” Gordon Brown threatened to destroy his empire after The Sun switched its support to the Tories, Kelvin MacKenzie, the former editor of the paper, has told the Leveson Inquiry.

Mr MacKenzie said Mr Murdoch told him that he had received a phone call in which the former Prime Minister “roared” at him “for 20 minutes”.

The former editor also told the inquiry into press standards that News International, Mr Murdoch’s company, had lied to the Press Complaints Commission and recommended that newspapers be fined for such actions in future.

He also referred to the phone hacking scandal and said The Guardian had “got away” with falsely reporting that News of the World journalists had deleted Milly Dowler’s voicemails.

Had such an error been made by The Sun, he said, the newspaper might have been forced to close.

Mr MacKenzie said he had worked closely with Mr Murdoch for 13 years in which he had spoken to him almost daily.

He told the inquiry that it was Mr Murdoch who disclosed Mr Brown’s alleged threat, something which the former Labour leader has repeatedly denied.

Although Mr MacKenzie was not at the meeting between the two men in late 2009, nor was he the newspaper's editor, he gave an account of the conversation as reported to him by Mr Murdoch.

The evidence, which first came during seminars at an early stage of the inquiry, was read to the hearing by its counsel Robert Jay QC and it refers to a speech by Mr Brown which did not get as much prominence as a story about the paper’s shift of allegiance to the Tories.

Mr MacKenzie had said: “Of course the endorsement blew away Brown’s speech off the front page.

“That night a furious Brown called Murdoch and in Rupert’s words “roared at me for 20 minutes”...

Asked at today's hearing who the source for the story was, Mr MacKenzie replied: “It was Mr Murdoch.”

Mr MacKenzie’s submission continued: “At the end, Brown said: “You are trying to destroy me and my party. I will destroy you and your company”.”

When reports of a conversation between the former Prime Minister and Mr Murdoch first surfaced, Mr Brown claimed to have numerous witnesses who could attest to its not having taken place.

After Mr MacKenzie’s evidence, a spokeswoman for Mr Brown said: “It has already been pointed out that there was no such phone call nor communication between Mr Brown and Mr Murdoch.”

News International declined to comment.

The inquiry heard further details of Mr Murdoch’s behaviour.

Mr MacKenzie refuted the broadcaster Anne Diamond’s previous claims to the inquiry that she had been singled out for negative treatment by his papers.

He said he had “never heard Rupert Murdoch say we should 'go after' anybody”.

Mr Murdoch was furious when he found out The Sun was to pay £1 million in damages to Elton John after a story falsely claimed the singer had hired rent boys, the inquiry heard.

Mr MacKenzie recalled sending the media mogul a fax then receiving a 40-minute phone call of "non-stop abuse".

He told the hearing: "Let's put it this way, he wasn't pleased."

On hacking and the way stories are perceived differently according to the newspaper in which they appear, Mr MacKenzie said: “Take the Milly Dowler deletions of those calls. Had that been The Sun, The Sun would have come very, very close to being shut down had they got that story wrong. The Guardian sticks the story on page 10 and they get away with it.”

[Douglas Caddy]

Leveson Inquiry: David Cameron could be called to give evidence

Daily Telegraph

7:45AM GMT 10 Jan 2012

David Cameron, the Prime Minister, is expected to be called to give evidence at the Leveson Inquiry.

Downing Street last night said the Prime Minister would attend if he was summoned.

Former PM Gordon Brown and Labour's current leader Ed Miliband are also expected to appear when the inquiry focuses on relations between the media and politicians, The Times said.

Responding to reports that Lord Justice Leveson is ''99.9%'' certain to call Mr Cameron for questioning under oath about his dealings with senior media executives and press baron Rupert Murdoch, a Number 10 spokeswoman said last night: ''A request has not yet been received. If asked, the Prime Minister would of course attend.''

A Leveson Inquiry source told the newspaper the final decision on which politicians to invite had not yet been made but added: ''I can't see how you can look at the relationship between the press and politicians without talking to top politicians, including the Prime Minister, the previous prime minister and the Leader of the Opposition.''

The newspaper suggests Mr Cameron is likely to be called after the local elections in May.

It is expected questioning will focus on his decision to employ Andy Coulson, the former editor of the defunct News of the World, who quit as Downing Street's director of communications amid continued pressure about phone hacking.

The inquiry heard yesterday from executives and senior reporters at The Sun, Britain's top-selling daily newspaper.

Editor Dominic Mohan said the paper could be a ''powerful force for good'' through its campaigns, support for charities and ability to explain complicated stories in a clear way.

Mr Mohan, a former showbusiness reporter who took on the editorship of The Sun in 2009, appealed for there to be a ''level playing field'' between the press and internet publications.

''I do think it could be a potentially mortal blow to the newspaper industry that's already wounded,'' he said.

''I think the combination of an over-regulated press with an unregulated internet is a very, very worrying thought.''

Mr Mohan said he was joking when he used a speech at an awards ceremony in 2002 to thank ''Vodafone's lack of security'' for the showbusiness exclusives in rival paper the Daily Mirror.

Former Sun editor Kelvin MacKenzie yesterday defended his ''bullish'' approach to running the paper as he acknowledged that his successors have been ''more cautious'' than he was.

He told the inquiry he did not spend much time worrying about journalistic ethics or which stories would sell more copies, leaving it to his readers to decide whether his decisions were right.

Prime Minister David Cameron set up the inquiry last July in response to revelations that the NotW commissioned a private detective to hack murdered schoolgirl Milly Dowler's phone after she disappeared in 2002.

The revelation comes as three editors of broadsheet national newspapers will today face questioning at the official probe, ordered by the Prime Minister following the exposure of illegal phone hacking at the News of the World.

Lionel Barber of the Financial Times, the Independent's Chris Blackhurst and The Daily Telegraph's Tony Gallagher are expected to be asked about their papers' approaches to ethics, fact-checking and complaints.

The first part of the inquiry, sitting at the Royal Courts of Justice in London, is looking at the culture, practices and ethics of the press in general and is due to produce a report by September.

It began taking evidence in November, and has heard a series of complaints about media intrusion from celebrities and the families of murdered and abducted children.

The inquiry's second part, examining the extent of unlawful activities by journalists, will not begin until detectives have completed their investigation into alleged phone hacking and corrupt payments to police, and any prosecutions have been concluded

[Douglas Caddy]

Mail on Sunday paid private investigator after his arrest

Editor tells the Leveson Inquiry paper paid Steve Whittamore 'substantial sum of money'

The Independent

By James Cusick

Thursday 12 January 2012

The Mail on Sunday continued to pay for the potentially illegal services of a private investigator after he was arrested and charged with illegally trading in people's personal information.

The editor of the Associated Newspapers title, Peter Wright, admitted to the Leveson Inquiry yesterday that the paper had continued to commission searches by Steve Whittamore long after the Operation Motorman police investigation resulted in his arrest in March 2003.

Mr Wright told the inquiry that his newspaper was using the services of Mr Whittamore's agency until September 2004. He had been charged in February of that year and was later given a conditional discharge when the Motorman case came to court in 2005.

The Mail on Sunday editor claimed that "a substantial sum on money" had been paid to Mr Whittamore during the years he worked for the Mail titles. He estimated the total payment to be around £20,000.

However, Mr Wright said that after Mr Whittamore was charged, the paper had used him only rarely and only when it was sure he would be acting legitimately. The inquiry was told:

* The top payment the paper made for a major interview in the past year was £50,000;

* A similar sum was paid to the former mistress of Lord Triesman, who revealed his allegations of bribes paid to football World Cup referees;

* The paper made a recent cash payment of £3,500;

* Payments had been made to public officials, mostly "people in the armed forces", for stories they wanted brought to public attention. Mr Wright said payments had not been made to police officers, to his knowledge.

It was also revealed that the Daily Mail picture desk receives 400 photographs a day of Pippa Middleton, the sister of the Duchess of Cambridge.

Mr Wright denied that journalists on his paper had concealed their use of Mr Whittamore, but admitted that when an internal audit was eventually ordered, it found that payments for the potentially illegal searches had been filed under the headings "taxis" and "accommodation".

Asked by Robert Jay QC, counsel to the inquiry, why he had not taken steps to identify the journalists who regularly used Mr Whittamore, Mr Wright said that although they had been dealing with someone acting in ways "which we were not entirely aware of" he had hoped a public interest defence would be possible.

The legal manager of Associated Newspapers, Liz Hartley, was later questioned about the Mail's response to evidence given earlier in the inquiry by the actor Hugh Grant.

Following his appearance before Lord Justice Leveson, the Daily Mail published a statement which read: "Mr Grant's allegations are mendacious smears driven by his hatred of the media." The draft statement, she said, included the input of Paul Dacre, the paper's editor.

David Sherborne, counsel for Mr Grant and other victims of press wrongdoing, said he expected Mr Dacre to address the issue when he gives evidence to the inquiry in February.

Mail exclusives: Public figures in the firing line

Lord Mandelson The Mail on Sunday revealed that the former cabinet minister and European commissioner had bought an £8m house. How could he afford such a palace? the paper asked. Lord Mandelson threatened to register a complaint with the PCC but the action was not pursued.

Lord Triesman Melissa Jacobs, mistress of the former Football Association chairman, revealed to the Mail on Sunday that she had secretly taped Lord Triesman talking about Spain and Russia colluding to bribe Fifa referees.

Pippa Middleton Since her sister Kate's wedding to Prince William, Ms Middleton has been a serial target for the paparazzi. The Mail's picture editor said he was offered 400 pictures a day of her not doing very much.

Bob Crowe During a transport strike, the MoS revealed that Mr Crowe, the rail union boss, had been using a borrowed scooter. Police later learned that Steve Whittamore's agency supplied the name of the vehicle's owner.

Hugh Grant The actor told the inquiry in its opening week that he believed The Mail had hacked his phone to obtain stories. The Mail responded saying it was a "mendacious smear" by someone who hated the media. The issue is still unresolved.