James Murdoch facing 'triple threat' over claims he knew of hacking culture

Published on Friday 22 July 2011 20:36

PRESSURE was piling on James Murdoch last night as the News International chairman faced the triple threat of a police investigation, parliamentary inquiry and shareholder rebellion.

The son of media tycoon Rupert, and heir apparent of News Corp, is accused of having known that a phone hacking culture went beyond a rogue reporter as far back as 2008 and lied to MPs about it at a hearing earlier this week.

Yesterday, Tom Watson MP called on the Met to investigate claims that Mr Murdoch was not telling the truth when he told members of the culture, media and sport committee that he was not aware of an e-mail suggesting that phone hacking was more widespread than had been publicly admitted.

Mr Murdoch's recollection of events was called into question when two former News International executives, Colin Myler, until recently editor of the now-closed-down News of the World, and Tom Crone, News International's former legal manager, issued a statement claiming Mr Murdoch was "mistaken", adding that they had made him aware of the e-mail sent at the time News International was agreeing an out-of-court settlement with Gordon Taylor, the chief executive of the Professional Footballers' Association, over phone hacking.

Last night Scotland Yard said it was considering the request from Mr Watson. The e-mail, dubbed "For Neville", is reported to contain information allegedly gleaned through phone hacking for the then chief reporter of the News of the World, Neville Thurlbeck.

"If Mr Myler and Mr Crone's version of events is accurate, it doesn't just mean that parliament has been misled, it means the police have another investigation on their hands," Mr Watson said. He added that it would mean that Mr Murdoch knew about widespread phone hacking and yet failed to discipline staff, failed to launch an investigation, and failed to alert police.

Mr Murdoch would also stand accused of intentionally misleading a Parliamentary committee, which in itself could lead to a jail sentence.

Mr Watson described the former executives' allegation as "the most significant moment of two years of investigation into phone hacking". Their claim has been denied by Mr Murdoch, who said he stood by his evidence.

Mr Watson said: "It shows that he not only failed to report a crime to the police, but, because there was a confidentiality clause involved in the settlement, it means that he bought the silence of Gordon Taylor and that could mean that he is facing investigation for perverting the course of justice."

David Cameron, who is also under pressure because of his former links to ex-News of the World editor and hacking suspect Andy Coulson, said Mr Murdoch had "questions to answer in Parliament".

The Prime Minister also suggested that the management of the Murdochs' media empire was now "an issue for the shareholders".BSkyB is expected to announce financial results next week. and James Murdoch's position as chairman of BSkyB is expect to come under scrutiny.

Alex DeGroote, a financial analyst, said: "It will be a tough decision for the board.

"At a time when BSkyB should be hypersensitive about the links to News Corp, both a special dividend and the chairman's position are pertinent."

Labour MP Chris Bryant, who is among those taking legal action over claims that his phone was hacked, has sought to step up the pressure on the company with a call for the suspension of Rupert and James Murdoch from their roles in News Corp. In a letter to non-executive directors, he said there had been a "complete failure to tackle the original criminality at the company" and "the lackadaisical approach to such matters would suggest that there is no proper corporate governance within the company".

News Corp has also faced accusations that Will Lewis, a senior executive of the company, orchestrated the leak of a secret recording obtained by a rival newspaper.

It was in that recording that Business Secretary Vince Cable, who at the time was monitoring the BSkyB bid, said he had "declared war" on Rupert Murdoch.

The story appeared on the BBC in December 2010 and Mr Cable was stripped of that responsibility, a move which was seen to benefit News Corp.

Rupert and James Murdoch had hoped to draw a line under the hacking affair when they appeared in front of the culture, media and sport committee in Portcullis House on Tuesday. They both apologised and Rupert Murdoch said the day was the most "humble" of his life.

James Murdoch added: "We felt ashamed at what happened. We had broken our trust with our readers."

Both denied all prior knowledge of either police payments or phone hacking, alleged victims of which have included Milly Dowler, relatives of the Soham murder victims, casualties of 7/7, and widows of personnel who died in Iraq and Afghanistan.

The company has consistently maintained that it only learned the problem was wider from papers lodged in a civil court case brought by the actress Sienna Miller at the end of last year.However, now critics of News International say the "for Neville" e-mail proves that bosses knew hacking was not confined to former royal editor Clive Goodman and private investigator Glenn Mulcaire, who were jailed in 2007.

In further developments, the Law Society in England disclosed that solicitors had been warned by police that their phones might have been hacked by the News of the World.

At the same time, the Solicitors Regulation Authority announced it was launching a formal inquiry into the role of solicitors in the events surrounding the phone-hacking scandal.