01 May 12 | Uncategorized
Rupert Murdoch is “not a fit person to exercise the stewardship of a major international company”, a committee of MPs has concluded today.
In a damning report on News International and phone hacking, the Commons culture, media and sport select committee accused the media mogul of exhibiting “wilful blindness to what was going on in his companies and publications” and not taking steps to become fully informed about the extent of phone hacking at his empire. It said:
This culture, we consider, permeated from the top throughout the organisation and speaks volumes about the lack of effective corporate governance at News Corporation and News International.
The report accused three former News International executives — Les Hinton, Colin Myler, and Tom Crone — of misleading the committee during its inquiries, which began in July 2011 in the wake of revelations about the extent of phone hacking at the now defunct News of the World. The report said that NI’s former legal manager Crone and ex-News of the World editor Myler “deliberately avoided disclosing crucial information to the Committee and, when asked to do, answered questions falsely”.
The report said that the company “finally realised that its containment approach had failed” by spring 2011 in the wake of civil cases brought forward, and that its “one rogue reporter” stance was by then no longer credible. It said that News Corp’s strategy was to “lay the blame on certain individuals” (citing Myler and Crone amongst others) while “striving to protect more senior figures, notably James Murdoch.”
“Even if there were a ‘don’t ask, don’t tell’ culture at News International, the whole affair demonstrates huge failings of corporate governance at the company and its parent, News Corporation”, the report added.
Meanwhile, former NI chairman James Murdoch, who gave evidence to the committee along with his father last year, was accused of “wilful ignorance” and of betraying “astonishing lack of curiosity on the part of a chief executive” for not having inquired more deeply into the extent of the practice in 2008, at the time of negotiations surrounding a £700,000 phone-hacking settlement paid to the Professional Footballers’ Association boss, Gordon Taylor.
“Had James Murdoch been more attentive to the correspondence that he received at the time, he could have taken action on phone hacking in 2008 and this committee could have been told the truth in 2009,” the report said.
Last month the younger Murdoch resigned as chairman of BSkyB, whose parent company News Corporation was founded by his father. He also stood down as chairman of the newspaper publisher, News International, earlier this year.
However the report’s conclusions were not unanimous, with the committee split over several of its findings. The motion to submit the report to Parliament passed by a majority of six to four, with four Conservative members opposing. Four of the five Tory members of the committee also refused to declare the elder Murdoch was a fit person to run an international company.
“This line about Rupert Murdoch not being fit was stuck in on the basis of no evidence to the committee whatsoever,” Tory MP Louise Mensch said. She added that the report was “carried on political lines” and feared its credibility had been damaged as a result of not having full backing of all committee members. Committee chair John Whittingdale stressed, however, that the committee was “wholly agreed” on the main findings relating to their being misled by named individuals.
Meanwhile, Ofcom released a statement noting it had seen today’s report:
Ofcom has a duty under the Broadcasting Acts 1990 and 1996 to be satisfied that any person holding a broadcasting licence is, and remains, fit and proper to do so. Ofcom is continuing to assess the evidence – including the new and emerging evidence – that may assist it in discharging these duties.
Marta Cooper is an editorial researcher at Index. She tweets at @martaruco
26 Apr 12 | Leveson Inquiry
In a second day of testimony before the Leveson Inquiry, Rupert Murdoch admitted that “one or two strong characters” were responsible for a cover-up of the phone hacking scandal at News International.
The News Corp chairman and chief executive explained to the court that he was “misinformed” and “shielded” from events that were taking place at the paper. Murdoch pointed the finger at “a clever lawyer”, who forbade people from reporting to News International chief executive Rebekah Brooks or chairman James Murdoch.
Despite the acknowledgement of the cover-up of the “cancer” that was prevalent in News International, Murdoch stressed to the court that the senior management of News Corp were not involved. He said:
“There was no attempt, at my level, or several levels below me to cover it up. We set up inquiry after inquiry. We employed legal firm after legal firm and perhaps we relied too much on the conclusions of the police.”
He added that when presented with information relating to a Guardian article in 2009 detailing unethical practices at the News of the World, the police said that the article was wrong. He said: “We chose to take word of police over guardian. We rested on that until beginning of 2011.”
After explaining that Colin Myler was hired as the editor of News of the World in 2007 to find out “what the hell was going on” in the newsroom, Murdoch admitted that he should have taken personal responsibility for ensuring that the brief was completed, and not delegated the duty to Les Hinton.
Murdoch also described his disbelief that law firm Harbottle and Lewis did not alert Rebekah Brooks that the problem was far more widespread than one rogue reporter: “I cannot understand a law firm reading that, and not ringing the chief executive of a company and saying ‘hey, you’ve got some really big problems’.”
The media mogul told the court that he had failed with now defunct News of the World. He said: “I am guilty of not having paid enough attention to News of the World, probably the whole time we owned it. It was an omission by me, and all I can do is apologise to a lot of people.”
Describing himself as “greatly distressed” by the closure of the News of the World, Murdoch admitted that the news paper and the journalistic practices operating within it were an “aberration”.
When asked by Jay why he closed the tabloid newspaper, rather than toughing it out, Murdoch told the court he “panicked”, but said he was glad he took that decision.
Murdoch explained “when the Milly Dowler situation was first given huge publicity, all the newspapers took it as the chance to make a really national scandal. You could feel the blast coming in the window almost.”
He added: “I’m sorry I didn’t close it years before and put a Sunday Sun in,” and described the “whole business” as “a serious blot on my reputation.”
Murdoch told the court he felt in hindsight should have had a one-on-one with Clive Goodman to establish if he was telling the truth that phone hacking was more widespread in the paper. Murdoch told the court he should have “thrown all the damn lawyers out” and cross examined Goodman. He added that if he decided Goodman was telling the truth he “would have torn the place apart, and we wouldn’t be here today.”
Turning to the controversial privacy case of ex-Formula One chief Max Mosley and Neville Thurlbeck’s blackmail of women involved in the case, Jay asked Murdoch if he really felt this kind of behaviour wasn’t something to worry about.
Murdoch replied: “A journalist doing a favour for someone, and someone doing a favour back is an every day occurrence.”
Leveson told Murdoch he considered that approach “somewhat disturbing,” asking the media proprietor to tell him if he believed this type of behaviour was seen as justifiable and acceptable common practice in the industry.
Murdoch replied: “It’s a common thing in life, way beyond journalism, for people to say I’ll scratch your back if you scratch mine. This seems to go beyond that.”
Seeing an opportunity to challenge continual assurances that Murdoch did not have any inappropriate relationships with politicians, Jay suggested it was interesting that “you scratch my back” was a common attitude, but not one Murdoch held with regards to politicians.
Referring to the BSkyB bid which caused so much controversy earlier in the week, Murdoch told the court he had never met, nor dealt with Jeremy Hunt.
When asked if he and his son James had discussed the replacement of Vince Cable with Jeremy Hunt, Murdoch told the court he didn’t believe they did. Following Hunt’s appointment to the bid, Murdoch denied that James Murdoch had said “we’ve got someone better now,” but told the court “we couldn’t have had anyone worse”.
Asked by Jay if he believed the bid was derailed as a result of the revelations that the phone of murdered teenager Milly Dowler had been hacked, Murdoch said he was unsure if it was related to the “Milly Dowler misfortune” but that he did believe it was as a result of the hacking scandal.
The inquiry will continue on 7 May
Follow Index’s coverage of the Leveson Inquiry @IndexLeveson
24 Apr 12 | Leveson Inquiry
In an explosive afternoon at the Leveson Inquiry, culture secretary Jeremy Hunt was branded a “cheerleader” for the News Corporation’s bid for BSkyB.
A round of revelations from former News International chairman James Murdoch, detailing extensive emails between the media proprietor and News Corporation’s director of public affairs, Fréderic Michel, suggested Hunt was in close contact with News International during the time business secretary Vince Cable was considering the BSkyB bid.
The inquiry heard that Hunt had received “strong legal advice” against meeting with Murdoch, but one email suggested that the pair speak on the telephone at a later date. As the hearing continued through the afternoon, Robert Jay QC explored numerous emails describing communications between Michel and Hunt’s office and advisors.
Jay told Murdoch that the emails made it “clear that you were receiving information along the lines that the UK government as a whole would be supportive of News Corp”, but Murdoch replied that Hunt had made similar comments publically, and the emails were “not inappropriate”.
Murdoch said: “I think Mr Hunt had said personally he didn’t see any issues … there’s no special information in there.”
The court heard that Hunt had said he was “frustrated” at not being able to contact Murdoch. After exploring a number of emails, Jay proposed that as informal contact had been discouraged, Michel continued communications with Hunt’s office through back door methods:
Jay said: “Mr Hunt must have taken the advice that formal meetings were ok, that would not impugn the fairness of the process. Informal contact would be inappropriate and the way to avoid the appearance of that is to let that contact take place secretly via Michel.”
Despite the support being given to Murdoch and News Corporation by Hunt, he denied thinking the BSkyB deal was “in the bag”, stressing that he was “very worried” about the transaction and his concerns grew as the process continued.
The Leveson Inquiry today published the 163 pages of correspondence between Jeremy Hunt’s office and News Corp over the BSkyB takeover.
Hunt was handed responsibility for the bid in December 2010 after it was taken away from Vince Cable, and has repeatedly stressed that the bid was handled in a way which was “completely fair, impartial and above board”.
Pressure has begun to mount on Hunt to resign amid the allegations, and a number of bookmakers have stopped taking bets that he will be the next cabinet minister to leave the government. A source reportedly told the BBC that the politician was “not even considering resignation” and would present his own evidence to the inquiry within the coming days.
Murdoch was also probed on his relationships with other politicians, including Tony Blair, Gordon Brown and David Cameron. He admitted, for the first time, that in 2010 during a dinner at the home of Rebekah Brooks, former News International chief executive, he discussed the BSkyB deal with Cameron, but Murdoch said he mentioned the dismissal of Cable during a “tiny conversation”.
The former chairman denied that his meetings with Cameron were to ascertain where he stood on issues such as regulation of press and TV, which would affect Mr Murdoch’s companies.
Murdoch also denied linking the political affiliation of a newspaper to a “commercial transaction like this”.
He added: “Nor would I expect that political support one way or another ever to translate into a minister behaving in an appropriate way, ever. I simply would not do business that way.”
James Murdoch resigned from News International in February 2012.
Rupert Murdoch will give evidence to the inquiry tomorrow, to deal with allegations that he was aware of allegations that phone hacking was more widespread than “rogue reporter” Clive Goodman.
Follow Index’s coverage of the Leveson Inquiry @IndexLeveson
24 Apr 12 | Leveson Inquiry
James Murdoch underwent a grilling at the Leveson Inquiry this morning, and denied accusations that he approved “over the odds” phone hacking settlements to prevent further damage to the reputation of News International.
The former chairman of News International denied the claims that the settlements were used to prevent details of more widespread hacking allegations coming into the public domain.
Referring to a settlement in the case of football Chief Gordon Taylor, in which both Taylor and News International sought confidentiality, Robert Jay QC described the payout, believed to be in the region of £700,000 in 2008, as “hush money.” Murdoch denied these claims, explaining that he had received advice from lawyers not to pursue the case further, to prevent events of the past being “dragged up”.
Jay also suggested that Taylor sought a higher payout because he was aware of the reputational damage that News International could have been subjected to as a result of his claim, though Murdoch denied ever hearing any discussion of the case as one of blackmail.
When asked if Murdoch considered the payout to be an extraordinary amount, he said: “I was told sufficient information to authorise them to go and negotiate at a higher level. I was not told sufficient information to turn over a load of stones that I was told had already been turned over.”
Murdoch added that he left it to Colin Myler, editor of the News of the World, and legal manager Tom Crone to negotiate the fee. A memo from Crone suggested that Myler was becoming increasingly frustrated with Taylor, because he felt he was attempting to blackmail the organisation.
The inquiry also heard details of a meeting on 10 June 2008, when the full extent of phone hacking was believed to be revealed in the “For Neville” email, and Taylor’s case was discussed. Murdoch denied that he had seen the email which suggested that phone hacking at News of the World was more widespread than one rogue reporter. Murdoch also claimed that the purpose of the meeting was not to bring him up to speed on the whole story.
In the same meeting, Jay suggested that Crone and Myler were “very keen” for the Taylor issue to be resolved, “to transmit the message to you that if you didn’t there were serious reputational risks to the company”.
Murdoch denied the suggestion that there was a failure of governance within the company, and that there was a cover-up of evidence linking others at News of the World to Mulcaire. He explained that he had been given “repeated assurances that the newsroom had been investigated,” and that ethics training had been undergone, and was continually ongoing.
When referred to the settlement of Max Clifford, Murdoch said he was not aware of the size of the claim. He added: “My understanding was that there was a litigation pending with Mr. Clifford but it was decided, that because there was a commercial relationship he and Rebekah Brooks wanted to re-establish, they settled it at that.”
Murdoch also recognised that the corporation had been too quick to dismiss Guardian claims in 2009, telling the court he was advised it was a smear campaign. He added: “”No matter where something comes from, whether it’s a commercial or political rival, being more dispassionate, forensic and understanding is very important.” Murdoch also acknowledged that they needed to assess allegations of wrongdoing in a way which was “dispassionate and forensic”, and regretted the “cavalier” attitude of News of the World.
James Murdoch’s testimony will continue throughout the afternoon.
Follow Index’s coverage of the Leveson Inquiry @IndexLeveson
