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Published: Tuesday, 5/1/2012

In phone hacking report, UK lawmakers say Rupert Murdoch unfit to lead major global company

ASSOCIATED PRESS

LONDON — News Corp. chief Rupert Murdoch is unfit to lead his global media empire, an influential group of British lawmakers said Tuesday in a closely divided ruling.

In a scathing report, the lawmakers said Murdoch's company misled Parliament about the scale of phone hacking at one of its tabloids.

Parliament's cross-party Culture, Media and Sport committee said News International, the British newspaper division of Murdoch's News Corp., had deliberately ignored evidence of malpractice, covered up evidence and frustrated efforts to expose wrongdoing.

The 81-year-old media mogul has insisted he was unaware that hacking was widespread at his now-shuttered News of the World tabloid, blaming underlings for keeping him in the dark.

The legislators said if that was true, "he turned a blind eye and exhibited willful blindness to what was going on in his companies."

"We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of a major international company," the report by the panel of 11 lawmakers said.

The judgment on Murdoch implies that News Corp., which he heads, is also not a fit to control British Sky Broadcasting, in which News Corp. holds a controlling stake of 39 percent.

Louise Mensch, a Conservative Party member of the panel, told reporters the committee had been divided over the harsh criticism of Murdoch.

Four Conservative members of the committee opposed the suggestion that Murdoch was unfit to lead a global company, but that stance was endorsed by four Labour Party members and one Liberal Democrat. The panel's chairman, a Conservative, did not vote.

The committee agreed unanimously that three key News International executives misled Parliament by offering false accounts of their knowledge of the extent of phone hacking at the News of The World — a rare and serious censure that usually demands a personal apology to legislators. Those were Les Hinton, Colin Myler and Tom Crone.

The report said Murdoch's son 39-year-old son James, a former News International executive chairman, was also badly at fault over the scandal.

Lawmakers said phone hacking at the tabloid dated back to at least 2001, and insisted that James Murdoch could have halted the practice as early as 2008.

"As the head of a journalistic enterprise, we are astonished that James Murdoch did not seek more information," legislators wrote.

But they stopped short of accusing the younger Murdoch of misleading lawmakers when he claimed not to have fully read a 2008 email which he had received and outlined that hacking was widespread.

The committee said Hinton — a former executive chairman of News International who resigned from his post as the publisher of The Wall Street Journal amid the hacking scandal — had misled them over his repeated claim that hacking was not rife at the News of The World. The committee urged Parliament to take action against him. Hinton worked as a top Murdoch aide on both sides of the Atlantic for decades.

The committee also demanded action against New York Daily News editor Colin Myler, also a former News of The World editor, and the British tabloid's longtime lawyer Tom Crone. It said they both had misled Parliament about their knowledge of the scandal.

Committee chairman James Whittingdale said "it is for the House (of Commons) to decide what consequences follow" from misleading Parliament.

Murdoch's News Corp. has been buffeted by the scandal, which has claimed the jobs of a string of his senior executives and several top British police officers amid allegations that Scotland Yard failed properly to investigate tabloid wrongdoing for years.

Murdoch closed down the 168-year-old Sunday tabloid last July amid public revulsion at the hacking of voice mail messages of celebrities and victims of crime, including murdered schoolgirl Milly Dowler.

At least 25 past and present employees of News International have been arrested by police investigating phone hacking, bribery and computer hacking. Murdoch has paid out millions to settle lawsuits from about 60 celebrities, sports stars, politicians and other public figures whose voice mails were hacked. Dozens more lawsuits have been filed.

Throughout the scandal, News International's approach "was to cover up rather than seek out wrongdoing," the legislators wrote.

News Corp. said it was "carefully reviewing the Select Committee's report and will respond shortly."

"The company fully acknowledges significant wrongdoing at News of the World and apologizes to everyone whose privacy was invaded," it said in a statement.



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