Rupert Murdoch and the Corruption of the British Media

[Douglas Caddy]

deleted

Edited April 28, 2012 by Douglas Caddy

[Douglas Caddy]

David Cameron could fire Jeremy Hunt if new evidence emerges

Mr Cameron said if new evidence emerged showing Mr Hunt's direct relationship with News Corporation had been too close, he could fire his minister.

The Telegraph

10:39AM BST

29 Apr 2012

"If evidence comes out through this exhaustive inquiry where you're giving evidence under oath - if he did breach the ministerial code - than clearly that's a different issue and I would act," said Mr Cameron.

Mr Cameron offered qualified support to Culture Secretary Jeremy Hunt, who is facing calls for his resignation over his handling of the BSkyB deal.

"As things stand, I don't believe Jeremy Hunt broke the ministerial code," Mr Cameron said.

But Mr Cameron said that the email contact between Culture Secretary Jeremy Hunt's special adviser Adam Michel and News Corporation's lobbyist Frederic Michel was "wrong", "too close, too frequent and inappropriate".

Mr Cameron said it would be "wrong" to sack Mr Hunt because his special adviser Adam Smith - who quit on Wednesday as the row grew - had been "too close" to the Murdoch empire and "acted inappropriately".

"There's absolutely no doubt that the contact between the special adviser in the Department for Culture, Media and Sport and News International, that was too close, too frequent and that's why there special adviser resigned, and that was the right thing to do," said Mr Cameron.

But he added: "I don't think it would be right in every circumstance if a special advisers gets something wrong to automatically sack the minister."

The Prime Minister went onto back beleaguered Mr Hunt, saying: "He does a good job, I think he's a good Culture, Media and Sport Secretary.

"I think he's doing an excellent job on the Olympics and frankly I do think people deserve to have these things looked into properly."

He called for "natural justice" to take its course so Mr Hunt could "explain his actions, all the information comes out".

On the matter of his own contact with Rupert Murdoch and members of his media empire, the Prime Minister admitted that he was embarrassed and that he might have done things differently in hindsight.

Mr Cameron admitted discussing matters with Mr Murdoch's son and top News Corp executive James Murdoch at a Christmas party at the Oxfordshire home of then News International chief executive Rebekah Brooks.

Asked whether he was embarrassed that he was even at the party, Mr Cameron said: "Clearly, after all that's been written and said about it, yes of course one might do things differently."

Mr Cameron said he did not recall the exact details of his conversation with Mr Murdoch but that it concerned the recent controversy over Business Secretary Vince Cable's comments that he had "declared war" on News Corporation.

"What I recall saying, although I can't remember every detail of the conversation, is saying something like: clearly that was unacceptable, it was embarrassing for the Government, and to be clear from now on this whole issue would be dealt with impartially, properly, in the correct way, but obviously I had nothing to do with it, I recused myself from it," he said.

But he maintained it was "not true" there was any agreement that in return for the Murdochs' support of the Government he would help their business interests or allow the BSkyB merger to go through.

"It would be absolutely wrong for there to be any sort of deal and there wasn't he told BBC1's Andrew Marr Show.

"There was no grand deal."

[Douglas Caddy]

Why Cameron and Osborne fear losing their firewall

The scandal over the BSkyB bid reveals how close Tory leadership was to News Corp

By Jane Merrick, Brian Brady, Matt Chorley

Sunday, 29 April 2012

The Independent

When Jeremy Hunt delivered his less than certain Commons statement on his role in the BSkyB bid and the Frédéric Michel emails last Wednesday, David Cameron and George Osborne remained on the front bench next to the embattled Culture Secretary. For more than an hour, the Prime Minister and Chancellor were unable to move – to leave would suggest they were hanging Hunt out to dry.

But their expressions revealed they were less than happy at their position. Cameron, who did not make eye contact with Hunt as the minister arrived at the Dispatch Box, appeared annoyed that he had to show his support. Next to him on the front bench sat Osborne, already grim-faced after news of the UK returning to recession.

Ultimately, however, they could not move because these two men are personally as bound up in the current scandal as the hapless Culture Secretary and his special adviser Adam Smith, who had resigned that morning. This weekend, with Hunt's job hanging in the balance, Cameron and Osborne are weighing up whether to save the Culture Secretary or to force him to resign. The refusal by No 10 to order a separate inquiry into Hunt's conduct shows the balance is currently tipped in favour of saving him. To let him go would be to tear down the firewall between News Corp, with Rupert Murdoch, his son James and Rebekah Brooks on one side, and the highest ranks of the Tory party, with Cameron, Osborne and the Education Secretary, Michael Gove, on the other. The Prime Minister recognises that it is the closeness to the Murdoch empire of these three at the top of government that goes to the true heart of the scandal.

In February 2009, News Corp, under its chief executive, James Murdoch, hired Frédéric Michel as its European public affairs director. Michel was to start smoothing the path for News Corp's bid to take over BSkyB, which would be announced following the 2010 election. With the Tories predicted to win that election, the contacts between News Corp and Cameron were stepped up. A year earlier, Cameron visited Rupert Murdoch on his yacht off Santorini, and had meetings with his son James and Rebekah Brooks, then editor of The Sun, promoted to chief executive of News International (NI) in June 2009.

That summer, according to sources, Osborne ordered Hunt to get close to James Murdoch. And when further revelations of phone hacking at the News of the World emerged in July that year, Osborne took the extraordinary decision to rubbish them and attempted to distance Andy Coulson, the No 10 spin-doctor he helped to hire after resigning over hacking in 2007, from the fresh allegations.

In an interview with The Independent on Sunday during the Norwich North by-election in July 2009, the shadow chancellor insisted: "I see no new allegations that are directly connected with Andy Coulson. I think it's up to those who made the allegations to substantiate them and I've not seen those allegations substantiated to date. And I thought it was pretty significant that the police came out and made it clear that they'd investigated all of this and there was no new evidence." In hindsight, it is easy to see why Osborne was so keen for the scandal to die down.

In August 2009 Murdoch Jnr delivered a blistering attack on the BBC and Ofcom at the MacTaggart Lecture at the Edinburgh Festival. That same month, Hunt took a trip to New York, where he met News Corp executives. Despite the putative BSkyB bid being mulled over inside News Corp, Hunt's aides have insisted that the issue of the satellite broadcaster did not come up.

Cameron was summoned to a meeting with James Murdoch at George, a private members club in Mayfair, in September 2009, where he was informed that NI titles would switch their allegiance back to the Tories from Labour.

It is clear that, from 2009, both the Tory and News Corp ships were sailing in the same direction. Once the BSkyB bid process started, the close links continued. The contacts that Hunt and Cameron had with the Murdochs have been widely reported. But it was also Osborne and Gove who were frequent dining companions of the media family.

Government documents reveal that Osborne met senior NI figures, including Rupert and James as well as Brooks, at least 10 times in the first 15 months after he became Chancellor. Gove met his most senior former colleagues at NI on at least 12 occasions in his first 15 months as Education Secretary.

Most importantly, however, was Cameron's contact. In a statement to the Commons in July 2011, the PM insisted he had had no "inappropriate conversations" with James Murdoch or other News Corp executives. However, as we now know after Murdoch Jnr's evidence to the Leveson inquiry last week, he did discuss the bid with Cameron in December 2010. Hunt told the Commons last Wednesday that the conversations were not "inappropriate" because Cameron was not in charge of the decision – a claim that stretches credulity, at best.

Those who opposed the BSkyB bid were astonished to discover the special treatment given to Murdoch. The campaign group Avaaz, which mustered 40,000 people to respond to the government consultation, felt shut out in the cold. Repeated demands for a meeting were rebuffed. "We were well on Jeremy Hunt's radar. His special advisers would have clocked that Avaaz were out there, yet when we phoned up we got the brush-off," said its campaign director, Alex Wilks.

In fact, the only meeting the group had was last April, outside a Sainsbury's supermarket in Godalming, in Hunt's Surrey constituency. "His main point was that he was scared that 'lawyers on both sides are ready to sue the pants off me if I mess up the scrutiny of this deal'," Wilks recalled. In May, Hunt slowed the consultation process, citing the huge response.

Wilks said this weekend: "It is outrageous that Jeremy Hunt, while claiming to be fair and looking into all sides... was leaning over backwards to communicate with Murdoch's people and yet ignore members of the public. David Cameron should show leadership and show Jeremy Hunt the door."

But, as things stood last night, Cameron is staying his hand. A hint of the lengths No 10 is going to to save the Culture Secretary came in the revelation that the Cabinet Secretary, Sir Jeremy Heywood, phoned Lord Justice Leveson on Tuesday in an effort to help Hunt. Officials claimed Heywood had been trying to ensure that "all key" witnesses, including those likely to support Hunt's defence, would appear as part of the inquiry. But critics said he had been trying to interfere with an independent process.

Calls for Sir Alex Allan, the PM's independent adviser on the Ministerial Code, to investigate the allegations against Hunt have been stonewalled.

The IoS understands that Heywood was asked to make the call because it was deemed inappropriate for Hunt himself to do it, but Leveson officials are understood to have been "bewildered" by the approach. However, with time apparently running out for Hunt, Cameron and Osborne's firewall is at risk, and things are about to get much more uncomfortable for the two men.

He's no Walter Mitty, but a key player

Under the cloak of parliamentary privilege, a Tory backbencher last week described News Corp lobbyist Frédéric Michel as a "Walter Mitty" figure who had exaggerated his influence with Culture Secretary Jeremy Hunt to impress his boss, James Murdoch.

But Michel – Fred to his friends – has played a key role behind the political scenes for more than a decade. Ten years ago, he was director of the New Labour think tank Policy Network; Peter Mandelson was chairman. With centre-left politics in the ascendant, he helped organise a private summit between the Prime Minister, Tony Blair, and former US president Bill Clinton. The awayday at Hartwell House in Buckinghamshire was dismissed by John Prescott (not invited) as a gathering of a "bunch of wonkers", but guests included the rising stars David Miliband and Yvette Cooper, as well as Mandelson himself.

Michel left Policy Network in 2003 – amid reports of a falling out with Mandelson – to set up his own PR firm, ReputationInc. But his stock soared again when James Murdoch appointed him News Corp's director of public affairs for Europe in February 2009. Here, he began an under-the-radar operation to launch News Corp's bid to take over BSkyB. This included James Murdoch's MacTaggart lecture at the Edinburgh Festival in August 2009, in which the News Corp heir launched an incendiary attack on the "chilling" activities of the BBC.

As we now know, Michel's lobbying stepped up after the bid was formally announced, post the 2010 election, when he began dealing with Hunt's adviser Adam Smith. In early December 2010, Michel was approached by the EU foreign affairs chief, Baroness Ashton, to be her spin-doctor. He never made the move. Days later Vince Cable was caught in a sting and the decision on the BSkyB bid was passed to Hunt.

Michel is not the first person to be dismissed as a "Walter Mitty" figure – David Kelly was famously described as such by No 10 after his death, a slur that was shown to be untrue and which continued to haunt Blair's government. It is a lesson Hunt and David Cameron would do well to heed.

Jane Merrick

The circumstantial evidence

January 2006 Rupert Murdoch has lunch with David Cameron and George Osborne.

May 2007 Andy Coulson becomes David Cameron's spin-doctor.

February 2009 James Murdoch hires PR man Frédéric Michel to lobby for BSkyB bid.

July 2009 First details of News of the World's cover-up of phone-hacking.

December 2009 News International CEO Rebekah Brooks hosts Christmas dinner, with the Camerons, the Osbornes and the Murdochs.

February 2010 Shadow Culture Secretary Jeremy Hunt discusses Sky's commercial interests with James Murdoch.

May 2010 The Conservatives form a coalition government.

June 2010 News Corp announces its bid for BSkyB.

November 2010 Vince Cable refers the BSkyB bid to Ofcom.

21 December 2010 Cable is removed from bid decision, Hunt is put in charge.

23 December 2010 The Camerons and James Murdoch attend Christmas dinner at the Brookses. The bid is discussed.

31 December 2010 Ofcom tells Hunt the bid might have to go to the Competition Commission.

6 January 2011 James Murdoch meets Hunt and officials at the DCMS.

21 January 2011 Andy Coulson resigns from 10 Downing Street.

24 January 2011 Hunt's office supplies News Corp with advance details of market-sensitive statement to be released the following morning.

26 January 2011 Metropolitan Police officially reopen NOTW phone-hacking inquiry.

February 2011 Ofcom demands safeguards from News Corp.

March 2011 Hunt announces green light for revised deal, subject to competition concerns.

June 2011 Hunt sanctions the bid, subject to consultation.

4 July 2011 The Guardian reveals NOTW hacked Milly Dowler's phone.

6 July 2011 Cameron announces inquiry into phone-hacking.

7 July 2011 Rupert Murdoch announces closure of NOTW.

8 July 2011 Coulson arrested over phone-hacking allegations.

1 September 2011 Leveson inquiry starts hearing evidence.

26 April 2012 James Murdoch gives evidence; emails reveal extent of his contact with Hunt's office during the bid process.

27 April 2012 Adam Smith, Hunt's adviser, resigns over relationship with News Corp; Hunt tells Parliament he did not act improperly.

28 April 2012 Leveson rejects Hunt's request to give evidence early; Downing Street rules out inquiry over alleged breach of ministerial code.

[Douglas Caddy]

News Corporation has sought to undermine elected governments

Rupert Murdoch is a man driven not so much by market forces as a deep desire to optimise his empire's power and influence

By David Puttnam

guardian.co.uk,

Saturday 28 April 2012 16.00 EDT

The story that unfolded last week at the Royal Courts of Justice has roots that stretch back more than three decades.

Behind the highly rehearsed faux candour of Murdoch senior, and the bland evasions of his son, lies a story in which democracy – not just in the UK, but in the US, Australia and elsewhere – has been consistently and wilfully undermined in pursuit not simply of profit but, far more corrosively, of power.

For the past 30 years, the Murdoch empire has sought to undermine and destabilise elected governments, and independent regulators, in pursuit of a political agenda that, while hiding behind a smokescreen of free market orthodoxy, is in the end nothing less than a sophisticated attempt to optimise the power and influence of News Corporation and its populist, rightwing agenda.

That's to say low (or better still, no) corporate taxes, minimal state regulation and the creation of an aura of "exceptionalism" sufficient to convince and recruit many of the most senior politicians in the western world to either turn a blind eye or actively help the company to achieve its commercial objectives.

The strategy is well-honed and, as Murdoch himself once admitted, brutally simple. "You tell the bloody politicians what they want to hear and once the deal is done don't worry about it," ran one quote in Thomas Kiernan's biography, Citizen Murdoch. "They're not going to chase after you later if they suddenly decide what you said wasn't what they wanted to hear. Otherwise, they're made to look bad and they can't abide that. So they just stick their heads up their asses and wait for the blow to pass."

The prime minister, Jeremy Hunt and other cabinet ministers were simply the latest in a long line, reaching back over three decades, to find themselves seduced by the possibility of Murdoch's support, only to discover their fair-weather friend has a habit of turning nasty when things fail to go his way.

Indeed, as I once (unsuccessfully) tried to explain to Jeremy Hunt, vast quantities of political capital can be spent clearing up the unintended consequences of what might, at the time, have appeared politically expedient decisions.

It is now clear that the extent of the secretary of state's prior dealings with the Murdoch empire, in opposition and then in government, were such as to make it totally inappropriate for him to have been handed political responsibility for oversight of News Corporation's bid for the whole of BSkyB.

He now finds himself branded as having behaved, not impartially, but more like a dodgy ref who not only demonstrates bias on the pitch, but ducks into the dressing room at half-time to offer advice.

To any politician with a serious interest in pursuing a "quasi-judicial" approach based on carefully assembled evidence, it ought to have been clear from the outset that the level of unregulated market and financial power that would accrue to News Corporation as a result of this transaction was likely to ensure the eventual emasculation of "free to air" public service broadcasting as we've known it.

It should have been clear that the BBC and Channel 4 would in a relatively short time have become little more than publicly funded research-and-development operations for subscription services, in danger of following the trajectory towards irrelevance that's been the fate of the public broadcasting system in the US.

Almost exactly 10 years ago, I had the privilege of chairing a joint committee (Lords and Commons) that sought to unhook any future secretary of state from the decision-making nightmare into which Mr Hunt has plunged himself. Clearly we failed. As he described it in Parliament last week: "This is a problem that has bedevilled politics for a very long time… they are very, very difficult issues."

On 6 July 2009, the then leader of the opposition, David Cameron, announced that, should he become prime minister, he would remove Ofcom's policy-making powers and cut back the communications regulator "by a huge amount". He went on to say that "the scope of their influence raises important questions for our democracy and our politics – these are organisations that feel no pressure to answer for what happens – in a way that is completely unaccountable".

They must have been cheering him to the echo in Wapping and two months later the Sun came out, all guns blazing, for the Conservative party. Corporate objectives and political expediency had found themselves in perfect alignment. Rereading that "Bonfire of the Quangos" speech in the light of last week's events, it's hard to know whether to laugh or to cry!

I've devoted the past 30 years of my life to issues of media plurality and the challenge of preserving the widest possible spectrum in the provision of both information and entertainment. Many will argue, with some justification, that the shotgun marriage that became BSkyB brought a significant degree of plurality and diversity to broadcast television, albeit at a cost few would have believed possible 25 years ago.

However, a successful media environment does not happen by accident and, when it does occur, it can and to my mind absolutely should be supported by thoughtful and sensitive regulation. What is certain is that plurality and diversity are not, and never can be, a natural "byproduct" of unregulated market forces.

I believe it's the responsibility of public policy to ensure the independence and diversity of opinion that have been a unique hallmark of our national culture, a quality much envied in other parts of the world. I've also attempted to be strictly non-partisan in my commitment to these issues. At different times, this has led to battles with most of the relevant unions and trade bodies, all of the broadcasters, even my own party.

In every case, what I was opposing was the concentration of power – be it from the market or elsewhere. The impact of new communication technologies has, if anything, made this more rather than less challenging. I would argue that competition law, in a fast-moving sector such as the media, must be able to take account of, and make judgments based on, "highly probable" as well as "actual" market dominance.

In the House of Lords and elsewhere, I have repeatedly called for a comprehensive cross-media impact study – so far to no avail. At the end of his session with Lord Justice Leveson, Rupert Murdoch described the digital landscape, which we have now entered, as one in which tablets and GPS-enabled smartphones are displacing newsprint. The potential of this technology to engender even greater competitive diversity in an intelligently regulated democracy ought to be very welcome. It should result in a broadening of the lens through which we see the world, not a narrowing of it.

But that requires a clear regulatory framework that encourages, in fact enables, media plurality to flourish. We cannot, for example, legislate for good journalism, but we can legislate for the conditions under which the very best journalism is nurtured and sustained. We can create frameworks in which each new technology becomes a spur for diversity, not an instrument of its erosion.

My passion was always based on a conviction that "information" and its related industries are unlike any other, in that they have an enormous influence on the broadest range of opinions and behaviour – in fact on the very health of society. As the distinguished historian Lord Hennessy put it: "This debate is about nothing less than the nature of 21st-century sovereignty."

Lord Puttnam is a Labour peer and was chairman of the Joint Parliamentary Scrutiny Committee for the 2003 Communications Act

[John Dolva]

Gough Whitlam (Labor Prime Minister of Australia in early seventies) indicates in his reply (The truth of the Matter) to GG J. Kerrs book about The Dismissal that Murdoch was a player. That was 40 years ago.

It seems this inquiry is very reluctantly broadening its scope. Why? There are documented indications that this whole thing is nothing but more of the same.

Ditto it seems the resistance, but there is a posiibility that this time what goes around will come around. I wouldn't hold my breath though

''(Rupert) Murdoch senior, and the bland evasions of his son, lies a story in which democracy – not just in the UK, but in the US, Australia and elsewhere – has been consistently and wilfully undermined in pursuit not simply of profit but, far more corrosively, of power.

For the past 30 (40, and if so why not more? -ed) years,the Murdoch empire has sought to undermine and destabilise (the) elected governments, and independent regulators, in pursuit of a political agenda that, while hiding behind a smokescreen of free market orthodoxy, is in the end nothing less than a sophisticated attempt to optimise the power and influence of News Corporation and its populist, rightwing agenda''.

edit typos

Edited April 30, 2012 by John Dolva

[Douglas Caddy]

James Murdoch to face MPs' criticism over phone hacking

Former News International chief failed to probe phone hacking at News of the World, parliamentary committee to report

By Dan Sabbagh

guardian.co.uk,

Monday 30 April 2012 15.00 EDT

James Murdoch will be criticised by MPs investigating phone hacking on Tuesday, but their assessment of his conduct is expected to fall just short of accusing the former chairman of News International of misleading parliament about the extent of his knowledge of the affair.

The all party culture media and sport select committee concluded they could not reach a final decision about whether Murdoch misled them because of what the MPs described as conflicting evidence, according to a source close to the process. However, there was enough to lead members to agree that Murdoch had not asked the questions that would help determine the true extent of phone hacking at the News of the World for several years.

Some Conservatives on the committee are understood to have argued that Murdoch should not have been criticised at all, but in a three-hour meeting, in which much of the debate was taken up with agreeing the final wording as regards the News Corporation heir, their amendments are understood to have failed.

News International now concedes in civil actions brought by hacking victims that illegal practice took place at the News of the World between 2001 and 2006, before Murdoch became executive chairman in late 2007.

However, News International admits that it did not appreciate the extent of hacking until the very end of 2010, when it saw fresh evidence in a case involving the actor Sienna Miller.

Murdoch appeared before the select committee in both July and November, and the outspoken Labour MP Tom Watson described him as acting like a mafia boss at that second hearing – a contention rejected by Murdoch. It fell to Damian Collins, a Conservative, to come closer to the committee's final conclusions, saying: "It may not be the mafia, but it doesn't sound like Management Today."

The select committee will reserve some of its strongest condemnation for Murdoch's predecessor in the role, Les Hinton, who had appeared before the committee three times over the past five years. Hinton told the committee last October that he was right to have told MPs in 2009 that phone hacking was not rife at the newspaper.

Hinton is expected to be accused of misleading parliament as a result, with MPs particularly focused on his evidence as regards Clive Goodman, the former News of the World royal editor, who went to jail for hacking in 2007.

Goodman subsequently made an unfair dismissal complaint, saying hacking was "widely discussed" until reference to it was banned by the then editor. But Hinton said the complaint was unfounded, and amounted to "accusations and allegations".

The parliamentary report will also criticise the former News of the World editor Colin Myler and the newspaper's long serving chief lawyer Tom Crone in a long awaited document due to be released on Tuesday.

Myler, who is now editor of the New York Daily News, and Crone had been repeatedly pressed on their failure to uncover what had happened.

However, Rebekah Brooks and Andy Coulson, the two previous editors of the Sunday tabloid when phone hacking took place, will not be singled out, because both have been arrested on suspicion of involvement in the intercepting of voicemail messages.

Committee members felt they could not condemn indiduals who had been arrested – providing some relief for David Cameron, who appointed Coulson as his chief spin doctor after Coulson resigned from the News of the World after Goodman was jailed.

Individuals found guilty of misleading parliament can be called to the bar of the Commons to apologise.

James Murdoch's father, Rupert, who gave evidence to the committee last July shortly after shutting the News of the World, is not accused of misleading parliament. But the MPs' report is understood to be critical of the corporate culture of News International, the UK subsdiary of his News Corporation, and the immediate parent company of the News of the World

[Douglas Caddy]

Rupert Murdoch 'not fit' to lead major international company, MPs conclude

Select committee also says James Murdoch showed 'wilful ignorance' of extent of phone hacking at News of the World

Read the full select committee report:

http://www.guardian.co.uk/media/2012/may/01/rupert-murdoch-not-fit-select-committee

By Dan Sabbagh and Josh Halliday

guardian.co.uk,

Tuesday 1 May 2012 06.31 EDT

Rupert Murdoch is "not a fit person" to exercise stewardship of a major international company, a committee of MPs has concluded, in a report highly critical of the mogul and his son James's role in the News of the World phone-hacking affair.

The Commons culture, media and sport select committee also concluded that James Murdoch showed "wilful ignorance" of the extent of phone hacking during 2009 and 2010 – in a highly charged document that saw MPs split on party lines as regards the two Murdochs.

Labour MPs and the sole Liberal Democrat on the committee, Adrian Sanders, voted together in a bloc of six against the five Conservatives to insert the criticisms of Rupert Murdoch and toughen up the remarks about his son James. But the MPs were united in their criticism of other former News International employees.

The cross-party group of MPs said that Les Hinton, the former executive chairman of News International, was "complicit" in a cover-up at the newspaper group, and that Colin Myler, former editor of the News of the World, and the paper's ex-head of legal, Tom Crone, deliberately withheld crucial information and answered questions falsely. All three were accused of misleading parliament by the culture select committee.

Rupert Murdoch, the document said, "did not take steps to become fully informed about phone hacking" and "turned a blind eye and exhibited wilful blindness to what was going on in his companies and publications".

The committee concluded that the culture of the company's newspapers "permeated from the top" and "speaks volumes about the lack of effective corporate governance at News Corporation and News International".

That prompted the MPs' report to say: "We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of major international company."

James Murdoch is described as exhibiting a "lack of curiosity … wilful ignorance even" at the time of the negotiations surrounding the 2008 Gordon Taylor phone-hacking settlement and into 2009 and 2010. The younger son of Rupert Murdoch is criticised for failing to appreciate the significance of the News of the World hacking when the "for Neville" email first became public in 2009 and during subsequent investigations by parliament in February 2010 and a New York Times report in September 2010.

"We would add to these admissions that as the head of a journalistic enterprise, we are astonished that James Murdoch did not seek more information or ask to see the evidence and counsel's opinion when he was briefed by Tom Crone and Colin Myler on the Gordon Taylor case," the select committee said.

Even if James Murdoch did not appreciate the significance of the £700,000 Taylor payout, the committee concluded it was "simply astonishing" that he did not realise that the "one 'rogue reporter' line was untrue" until late 2010, after a previous inquiry by the culture select committee which ran during 2009 and reported in February 2010.

According to minutes published by the committee, the MPs were almost unanimous in their criticism of Hinton, Myler and Crone.

Rebekah Brooks, the former News of the World editor and News International boss, was largely spared from the MPs' criticism. The report said that it would not draw conclusions on evidence to the committee about Milly Dowler, the murdered schoolgirl whose voicemail messages were hacked by the News of the World in 2002, because of an ongoing police investigation into Brooks.

However, the MPs said that Brooks must take responsibility for "the culture which permitted" unethical newsgathering methods over Dowler in 2002. The MPs said: "The attempts by the News of the World to get a scoop on Milly Dowler led to a considerable amount of police resource being redirected to the pursuit of false leads."

Brooks is on police bail after being arrested as part of Scotland Yard's investigation into phone hacking on 17 July 2011 and, separately, on suspicion of conspiracy to pervert the course of justice along with her husband, Charlie, on 13 March this year. Brooks denies knowledge of or involvement in phone hacking or other illegal activities.

The culture select committee charged Hinton with being "complicit" in a cover-up of wrongdoing at Rupert Murdoch's media empire.

MPs said that Myler and Crone deliberately withheld crucial information and answered falsely questions put by the committee.

The executives demonstrated contempt for parliament "in the most blatant fashion", the MPs said, in what they described as a corporate attempt to mislead the committee about the true extent of phone hacking at the News of the World.

The MPs said that Hinton, executive chairman of News International until December 2007, had "inexcusably" mislead the committee over his role in authorising the £243,000 payout to Clive Goodman, the former royal editor convicted of phone hacking in January that year.

"We consider, therefore, that Les Hinton was complicit in the cover-up at News International, which included making misleading statements and giving a misleading picture to the committee," the MPs said.

Crone and Myler were accused of deliberately misleading the MPs on the culture select committee in 2009 and again in 2011 about their alleged knowledge that phone hacking went beyond a single "rogue reporter" at the now-closed Sunday tabloid.

"Both Tom Crone and Colin Myler deliberately avoided disclosing crucial information to the committee and, when asked to do, answered questions falsely," the MPs said in the report.

All three executives now face the prospect of being called to apologise before parliament, in a constitutional move that has not been used for almost half a century.

The report could prove especially problematic for Myler, who is only five months into his editorship at the New York Daily News.

The select committee said it would table a Commons motion asking parliament to endorse its conclusions about misleading evidence.

Myler said he stood by his evidence to the committee. "While I respect the work that the select committee has carried out, I stand by the evidence that I gave the committee. I have always sought to be accurate and consistent in what I have said to the committee," he said in a statement on Tuesday afternoon.

"The conclusions of the committee have, perhaps inevitably, been affected by the fragmented picture which has emerged from the various witnesses over successive appearances and by the constraints within which the committee had to conduct its procedure.

"These issues remain the subject of a police investigation and the Leveson judicial inquiry and I have every confidence that they will establish the truth in the fullness of time."

Hinton has issued a statement denying the allegations. "I am shocked and disappointed by the culture, media and sport select committee's allegations that I have misled parliament and was 'complicit' in a cover-up," he said.

"I refute these accusations utterly. I have always been truthful in my dealings with the committee and its findings are unfounded, unfair and erroneous.

"To be clear, not once in my testimony before the committee did I seek to mislead it or pass blame for decisions to others. Nor did I participate in a 'cover-up'. Furthermore, there is nothing in my evidence to support the committee's findings that I did. I will be writing to John Whittingdale, the chair of the committee, to object formally."

News Corp said in a statement: "News Corporation is carefully reviewing the select committee's report and will respond shortly. The company fully acknowledges significant wrongdoing at News of the World and apologises to everyone whose privacy was invaded."

[Douglas Caddy]

http://www.telegraph.co.uk/news/uknews/leveson-inquiry/9238815/MPs-phone-hacking-report-what-they-said-about-the-key-players.html

[John Dolva]

So far, if I was to pick a 'hero' it would be Tom Watson.

It is of no surprise to me that left elements have shown most courage in pursuing this. Also it is of no surprise that right wing elements seem most keen to absolve the real criminal Don here, Rupert Murdoch.

Well done, Tom.

[Douglas Caddy]

Rupert Murdoch's Fox broadcast licences targeted by US ethics group

FCC called on to revoke licences in wake of British parliamentary report as phone hacking scandal widens abroad

By Ed Pilkington and Dominic Rushe in New York

guardian.co.uk,

Tuesday 1 May 2012 17.41 EDT

A Washington-based ethics watchdog is calling on federal regulators to revoke News Corporation's 27 Fox broadcast licences in the wake of the highly critical report on phone hacking from the UK parliament.

Citizens for Responsibility and Ethics in Washington (Crew) has written to the chairman of the Federal Communications Commission, Julius Genachowski, calling on the regulator to pull the plug on Rupert Murdoch's lucrative television licences on grounds of character.

The letter argues that the final report of the UK Commons culture, media and sport committee, which concluded that Murdoch was not fit to run a major international company, had implications for the US regulators that they had now to act upon.

Melanie Sloan, Crew's director, said that the Murdochs had clearly failed the character test that is embedded within US media law as it is within British. "If they are not passing the character standard under British law, it seems to me that they are not going to meet the character standard in America."

In their report, the British parliamentarians found Rupert Murdoch was "not a fit person" to exercise stewardship of a major international company. The Commons culture, media and sport select committee also concluded that James Murdoch showed "wilful ignorance" of the extent of phone hacking during 2009 and 2010.

Under FCC regulations, broadcast frequencies can only be handed to firms run by people of good "character" who serve the "public interest" and speak with "candor". In making that judgment, the FCC is entitled to consider past conduct of media owners, including conduct that does not relate directly to their broadcasting interests, as well as any patterns of alleged misbehaviour.

The FCC has so far shown an unwillingness to be drawn into the billowing phone hacking scandal concerning the News of the World and other News Corporation outlets in the UK. Last July, Genachowski indicated that he did not expect his agency to get involved in the probe.

But Crew insisted that as more information emerges about the failure of News Corp to deal with its hacking crisis, federal authorities would eventually be forced to act. The watchdog has also written to the US Senate and House committees on commerce calling for congressional hearings into whether the Murdochs were fit to hold the Fox TV licences. A similar request from Crew last year went unanswered.

Any suggestion that there was scrutiny of News Corp's TV licences would cause havoc within the company because its profits are closely tied to television in the US. However, the firm's shareholders appear to be relaxed in that regard, as News Corp's shares rose slightly after news broke of the scathing UK committee report.

Analysts have long discounted the UK newspaper business as a distraction and too tiny to affect the bottom line. One speculated that investors were betting the report was likely to lead to News Corp focusing on its larger, more profitable US assets.

Thomas Eagan, media analyst at Collins Stewart said more pressure on Murdoch meant more responsibility for Chase Carey, News Corp's chief operating officer. "That's a positive for us, we are big fans of Chase Carey," he said.

The big unanswered question for shareholders is over the British pay TV giant BSkyB, Eagan said. Ofcom, the British media regulator, is currently assessing whether News is a "fit and proper" owner of the profitable firm. The hacking scandal effectively ended News Corp's bid for full control of BSkyB. Should Ofcom rule against Sky, it may have to sell all or part of its 39.1% holding in the pay-TV operator.

Some shareholders are intensifying their calls for a shake-up at the top of News Corp on the back of the British parliamentary report. Change to Win, an advisory group that works with pension funds with over $200bn in assets, called for Murdoch to resign. Senior policy analyst Michael Pryce-Jones said News Corp's board should meet to form a succession plan immediately. "This is a company in crisis," he said.

Pryce-Jones said that when he first saw the headlines about the report he had assumed they were talking about James Murdoch. "This is far worse than I had expected," he said. "The focus is now on Rupert."

He added: "In any other company James would have have been sacked in July and we'd be preparing for succession. [Rupert] Murdoch clearly can not stay on a CEO and chairman of this company."

Pryce-Jones said he blamed News Corp's independent directors for much of what had gone wrong. The directors include top US lawyer Viet Dinh, chief architect of the USA Patriot Act, Joel Klein, the former chancellor of the New York City department of education and Rod Eddington, former chief executive of British Airways. "They have said that they are going to act, but they have done nothing. They need a Plan B. Plan A was apparently to ignore this and hope it would go away," he said.

Father Seamus Finn of the Interfaith Center on Corporate Responsibility, who led a shareholder vote against Rupert and James Murdoch and other senior executives at News Corp's annual general meeting last year, said: "This report is exactly what I asked Mr Murdoch about last year, it's about the culture of the company and who sets the tone for that culture."

He said the report "sets another stone on the balance" against Murdoch but that for US shareholders the political nature of the report was likely to lead many to discount its impact. "This is an extraordinary report but it is happening in a political context," he

[Douglas Caddy]

Lord Justice Leveson: Part 2 of my Inquiry into phone hacking may not be necessary

Lord Justice Leveson has hinted that the second part of his inquiry into the press, which is due to look into phone-hacking, may not be necessary because of the mass of material that is likely to become public if journalists go to trial.

By Gordon Rayner, Chief Reporter

The Telegraph

11:11AM BST 02 May 2012

The Leveson Inquiry was split into two parts when it was set up, to avoid clashing with the ongoing police investigations into phone hacking, computer hacking and corrupt payments to public officials.

The first part, which has been underway since last November, is examining the “culture, practice and ethics of the press”, and will result in a report to Parliament later this year setting out recommendations for a new regulatory regime.

A second part, specifically looking into phone hacking, is due to follow at some point in the future, but the Inquiry chairman suggested it may never happen, inviting participants to consider “the value to be gained” from it.

In a written judgment on the way the Inquiry Rules 2006 should be applied, he commented: “If there are [prosecutions for phone-hacking] it is likely that the process of pre-trial disclosure and trial will be lengthy so that Part 2 of this Inquiry will be delayed for very many months if not longer.

“If the transparent way in which the Inquiry has been conducted, the Report and the response by government and the press (along with a new acceptable regulatory regime) addresses the public concern, at the conclusion of any trial or trials, consideration can be given by everyone to the

“That inquiry will involve yet more enormous cost (both to the public purse and the participants); it will trawl over material then more years out of date and is likely to take longer than the present Inquiry which has not over focussed on individual conduct.”

He said it was “undeniably a sensible strategic consideration for those who have participated in this Inquiry”.

More than 50 people have been arrested so far by Metropolitan Police officers investigating hacking and alleged bribery, though no-one has yet been charged.

Even if charges are brought in the next few weeks, it is unlikely that any trial would be concluded before next year, and if there were multiple trials the delay could be considerably longer.

The first part of the Inquiry has already considered a large amount of evidence relating to phone-hacking, after hearing from victims including the family of the murdered schoolgirl Milly Dowler and celebrities including Hugh Grant and Steve Coogan.

It has also considered the relationship between the press and the police and is currently taking evidence on the relationship between the press and politicians, hearing last week from Rupert and James Murdoch.

In the final section of the current session, it will listen to suggestions on how a more effective system of regulating the media can be brought in that “supports the integrity and freedom of the press while encouraging the highest ethical standards”.

[Steve Knight]

http://www.guardian.co.uk/media/2012/may/02/murdoch-phone-hacking-us-senator?newsfeed=true

Murdoch facing new challenge as US senator contacts Leveson over hacking

John Rockefeller writes to British judge in bid to find out whether News Corporation has broken American laws

• 
  Ed Pilkington in New York
  
• guardian.co.uk, Wednesday 2 May 2012 23.36 BST
  

Rupert Murdoch's global media empire is facing a challenge on a new front in the billowing phone-hacking scandal after a powerful US Senate committee opened direct contact with British investigators in an attempt to find out whether News Corporation has broken American laws.

John Rockefeller, chairman of the Senate committee on commerce, science and transportation, has written to Lord Justice Leveson, who leads the British judicial inquiry into media ethics, asking if he has uncovered any evidence relating questionable practices in the US.

"I would like to know whether any of the evidence you are reviewing suggests that these unethical and sometimes illegal business practices occurred in the United States or involved US citizens," Rockefeller writes in a letter released on Wednesday.

The development adds to the potential dangers facing News Corp, a publicly-traded company with its headquarters in New York. Rockefeller has taken a close interest in the unfolding phone-hacking saga, but it is the first time that a Senate committee member has acted in his official capacity.

Should the committee decide to press its case, it has considerable powers at its disposal. It could convene official Senate hearings into the scandal and subpoena witnesses and documents from News Corp – though as yet there is no discussion of doing so.

The commerce committee covers all means of communications in the US – including telecommunications, free-to-air broadcasting and cable TV. It also has oversight over the Federal Communications Commission, the regulatory body that has final say on the issuing of broadcast licences, including the 27 licences issued to the Fox TV network that is the jewel in Murdoch's crown.

The FCC, which has come under pressure this week from ethics watchdogs calling for action against News Corp, can revoke licences if it deems that the companies holding them are not properly run in the public interest.

In his letter to Leveson, Rockefeller asks whether some of the more than 5,000 potential victims of phone hacking by the now-defunct News of the World may have been American. "I am concerned about the possibility that some of these undisclosed victims are US citizens, and the possibility that telephone networks under the jurisdiction of US laws were used to intercept their voicemail messages."

He adds that he wants to know whether any News Corp business had "used hacking, bribing, or other similar tactics when operating in the US".

In a scathing attack on the Murdoch company, Rockefeller writes: "In a democratic society, members of the media have the freedom to aggressively probe their government's activities and expose wrongdoing. But, like all other citizens, they also have a duty to obey the law.

"Evidence that is already in the public record clearly shows that for many years, News International had a widespread, institutional disregard for these laws."

Rockefeller also asks for details emerging from the Leveson inquiry that indicated whether any News Corp executives based in New York were aware of illegal payments made by News of the World to British police and other public officials. "I would be very concerned if evidence emerged suggesting that News Corporation officials in New York were also aware of these illegal payments and did not act to stop them."

The senator does not name individuals. Rupert Murdoch and his son James – who was until recently the chairman of News Corp's British newspaper division, News International – are based in the New York headquarters, as was Les Hinton, James Murdoch's predecessor, who was this week accused by the UK Commons culture committee of misleading parliament. Hinton resigned in July.

Rockefeller's intervention was triggered by the final report of the British parliament's culture, media and sport select committee, which concluded that Murdoch was not fit to run a major international company. It comes two weeks after Mark Lewis, a British lawyer at the forefront of the phone-hacking investigations, opened investigations into four cases of alleged phone hacking that occurred in the US.

On Wednesday, the News Corp board issued a statement backing Rupert Murdoch, saying its members had "full confidence" in his" fitness" to run the company he built from a single newspaper in Adelaide.

News Corporation said that it based its vote of confidence on "Rupert Murdoch's vision and leadership" in building the company from its modest roots, "his ongoing performance", and his "demonstrated resolve to address the mistakes of the company identified in the select committee's report."

On the same day as the Senate commerce committee made its move, a second US senator, Frank Lautenberg of New Jersey, renewed his call for a US government investigation into whether News Corp broke anti-bribery and corruption laws. Lautenberg called for a robust inquiry into whether the company, by allegedly bribing public officials in he UK, had breached the Foreign Corrupt Practices Act, which forbids American citizens or companies from engaging in acts of bribery abroad.

[Douglas Caddy]

http://www.ft.com/cms/s/0/0ad38090-9426-11e1-bb47-00144feab49a.html#ixzz1tlJ6whkP

US senators raise heat on Murdoch

Financial Times

May 2, 2012

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

Two Democratic senators have turned up the political pressure on News Corp, reviving questions about whether a scandal at Rupert Murdoch’s UK newspapers could jump across the Atlantic.

A day after a damning parliamentary report into Mr Murdoch’s handling of the affair, News Corp’s directors gave him their unanimous backing, quelling speculation that he

But their statement was followed by news that Senator Jay Rockefeller of West Virginia had written to Lord Justice Leveson, who is leading an inquiry into the conduct of the British press, asking for any evidence that “troubling and sometimes criminal conduct” had occurred in the US or involved US citizens.

Mr Rockefeller, who first raised concerns about phone hacking last summer, chairs the Senate commerce committee, which has the power to hold hearings, and has oversight of the Federal Communications Committee.

The Federal Bureau of Investigations opened a probe into News Corp after Mr Rockefeller’s intervention.

He widened his concerns to include allegations of payments to police officers and other public officials, saying US-traded companies such as News Corp had “a duty to exercise adequate financial controls over their subsidiaries”.

Frank Lautenberg, the New Jersey senator who called last summer for investigations into possible breaches of the US Foreign Corrupt Practices Act, said allegations in Tuesday’s report by a House of Commons committee on media made it “critical” that US authorities ensured that US laws had not been broken.

News Corp had no comment.

In an unscheduled conference call on Wednesday morning, its board discussed Tuesday’s majority verdict by the Commons committee that Mr Murdoch was “not a fit person” to run a large international company.

The board – briefed by lawyers including Gerson Zweifach, general counsel, and Joel Klein, one of Mr Murdoch’s closest executives – voiced “full confidence in Rupert Murdoch’s fitness” and said they wanted him to remain chairman and CEO.

Mr Murdoch also received support from Moody’s, the credit rating agency, which said it saw no cause to cut News Corp’s Baa1 rating. Despite “the highly politicised hyperbole”, it said the company had ample liquidity to mitigate the scandal’s costs.

However, Moody’s said the MPs’ report could influence Ofcom as the UK media regulator considers whether British Sky Broadcasting, the pay-television group News Corp controls, is a “fit and proper” holder of a broadcast licence.

BSkyB moved to distance itself from its biggest shareholder on Wednesday. “It is important to emphasise that Sky and News Corp are separate companies,” said Jeremy Darroch, BSkyB chief executive. “We believe that Sky’s record as a broadcaster is the most important factor in determining our fitness to hold a licence.”

“The likelihood of Ofcom removing BSkyB’s broadcasting licences is zero. BSkyB itself has no case to answer,” said Claire Enders, a media analyst. However, she said Ofcom could require James Murdoch to stand down as a BSkyB director.

[John Simkin]

It has emerged that the Conservative MP Louise Mensch was the Murdoch's main protector on the culture, media and sport select committee. In the televised sessions she appeared to be highly critical of illegal activities employed by News International. However, according to Paul Farrelly, one of the Labour MPs on the committee, in private, she always argued that the two Murdochs were not responsible and led the Tories into voting against whether Murdoch is a fit and proper person to run an international company. Is it for money or do the Murdoch press have something on Mensch. After all, we now know that the Nes of the World reporters were told to dig up dirt on the committee members. This included employing private investigators to spy on these members.

[Douglas Caddy]

News Corp was given private committee details, suggests Tom Watson

MPs Louise Mensch and Tom Watson take to Twitter in ongoing row over select committee's report into phone hacking

By Lisa O'Carroll

guardian.co.uk,

Thursday 3 May 2012 06.34 EDT

The Commons culture, media and sport select Committee. MPs Louise Mensch and Tom Watson have been publicly at odds since the publication of the committee's report into phone hacking. Photograph: Rebecca Naden/PA

Labour MP Tom Watson has suggested that News Corporation was given details of private discussions about the culture select committee's controversial phone hacking report, in an escalating row with his Conservative counterpart Louise Mensch.

Watson, replying to Mensch during a Twitter spat following the Tory MP's appearance on BBC Radio 4's Today programme on Thursday morning, said a letter sent by James Murdoch, News Corp deputy chief operating officer, "seemed uncannily to answer concerns raised in private discussions" by committee members.

The pair have been publicly at odds since the report's publication on Tuesday about the line claiming that Rupert Murdoch was "not fit" to run an international company, which Mensch and other Tory members of the committee opposed.

In a seven-page letter sent to MPs on the Commons culture, media and sport select committee in March, Murdoch expressed his deep regret over the News of the World phone-hacking scandal, but maintained he had not misled parliament over the affair.

After an hour of testy back and forth on Twitter prompted by Mensch's appearance on Today, Watson threatened to publish all the amendments Tory MPs on the committee had put forward for the report.

When Mensch replied that he ought to make sure he included a timeline of the amendments, Watson tweeted: "You mean James Murdoch's second letter that seemed to uncannily answer concerns raised in private discussions? No problem."

Mensch hit back: "Are you accusing me of something? Not like you. Don't let temper get better of you. 'Fit' was error."

Labour MP and phone-hacking victim Chris Bryant then joined in over allegations that the Tories were lobbied by News Corp over the final report.

"Can I just check? Has @theresecoffey said whether she received private NI or News Corp briefings? @LouiseMensch @tom_watson," he tweeted.

The Twitter row began after Mensch claimed the question of whether Murdoch was fit or not was not discussed in advance of a final select committee meeting on the report on Monday, with Watson insisting it had been raised six weeks earlier.

Mensch tweeted to Watson: "You never discussed it nor asked for it to be discussed. All Cons members were stunned to find you pushing it – and Lab voting."

Mensch was one of the four Tory MPs who voted against the "not fit" line being inserted into the report and on Tuesday, when it was published, criticised Watson and his Labour colleagues for introducing the amendment at the last minute.

She argued the committee took no evidence on the issue and had not even discussed the criteria or standard by which someone could be judged fit to run a company.

The vote split the committee, with the Conservatives refusing to support the final report. This rendered it partisan and essentially worthless, Mensch said on BBC2's Newsnight programme on Tuesday.

Watson hit back on Twitter on Thursday morning, saying that the amendment was tabled six weeks earlier. "Oh @LouiseMensch. Amendment was in on 27th March. You waited until Monday to say you wouldn't support report of it was included."

Mensch replied: "You will acknowledge all other contentious amendments 'parked' were extensively discussed at request of tabler."

Earlier, Watson vented his spleen over Mensch's appearance on Radio 4's Today, tweeting the programme directly to seek a right of reply: "Good morning @BBCr4today Are you going to allow me to clarify my position? I think @LouiseMensch has given you a partial account of events."

Late on Wednesday, ratings agency Moody's said that News Corp bondholders had nothing to fear from the fallout from the UK parliamentary report.

Moody's said its rating of News Corp's debt would not be affected by the political hyperbole about Murdoch emanating from London.

The media and entertainment giant's significant cash balance and strong free cash flow generation mitigated the uncertainty of additional financial fallout from the phone hacking scandal, the agency said, and News Corp continued to have a strong Baa1 unsecured rating.

Murdoch also got the unaminous backing of the News Corp board late on Wednesday after an unscheduled meeting of directors by phone.

News Corp said the board based its vote of confidence on Rupert Murdoch's vision and leadership in building the company from its modest roots, his ongoing performance and his demonstrated resolve to address the mistakes of the company identified in the select committee's report.