Bloomberg News

News Corp. Phone-Hack Allegations to Be Debated by Lawmakers

July 06, 2011

(Updates with new allegations starting in first paragraph.)

July 6 (Bloomberg) -- U.K. lawmakers will debate calls for an urgent public inquiry into phone-hacking by Rupert Murdoch’s News of the World as allegations mounted that the newspaper tapped the voicemails of murder victims and their families and paid police officers for stories.

Members of the House of Commons agreed to the emergency debate demanded by Chris Bryant, a lawmaker from the opposition Labour Party, who is one of more than two dozen people suing the News Corp. tabloid over phone-tapping. The three-hour debate will be held in Parliament in London this afternoon.

“The only way we can get to the full truth is to have a public inquiry led by a judge,” Bryant told lawmakers yesterday. “The News of the World is not just a paper out of control, that’s not just a paper believing it’s above the law, it’s a national newspaper playing God.”

U.K. Prime Minister David Cameron called the allegations “really appalling,” and Ford Motor Co. said yesterday it will stop placing advertisements in the News of the World and will use other media. RWE AG’s Npower unit and Deutsche Telekom AG’s T-Mobile division in the U.K. said they’re reviewing their advertising in the tabloid.

Rebekah Brooks, the chief executive officer of News International, vowed yesterday to “vigorously pursue the truth” while denying any knowledge of phone-tapping.

Murder Victims

Since the first reports on July 4 that the newspaper deleted messages from the voicemail of murdered schoolgirl Milly Dowler in 2002, British media made further allegations of illegal practices at the News of the World. Detectives investigating phone-hacking have contacted the parents of Holly Wells and Jessica Chapman, two girls who were murdered in eastern England in 2002, the Press Association newswire cited police as saying yesterday.

Families of the victims of the July 7, 2005, terror bombings in London have been told they may have been the target of phone hacking. Graham Foulkes, whose son David died in the attack, said he had been contacted by police yesterday.

“It fills you with horror,” Foulkes told BBC Radio 4, describing his feelings on learning that messages left in the wake of the bombing could have been intercepted. “We were in a very dark place. We were using the phone and frantically trying to get information. The thought that these guys may have been listening to that is just horrendous.”

Foulkes said he wanted to confront Murdoch directly. “I would very much like to meet him face to face and have a very in-depth discussion with him about responsibility and the power that he has and how it should be used appropriately.”

E-Mails

The BBC reported that News International, the News Corp. unit that publishes the newspaper, passed e-mails to the police that showed Andy Coulson, a former editor, authorized payments to police officers worth tens of thousands of pounds.

“The e-mails in question were passed to police some time ago,” Simon Greenberg, News International’s corporate affairs director, told Radio 4, while refusing to confirm their contents. He said the company was “shocked and appalled” at the newest allegations.

The four-year-old phone-hacking scandal previously centered on celebrities, politicians and sports stars. Coulson, who resigned from the newspaper in 2007 when a reporter was jailed for phone hacking, went on to work for Cameron as director of communications. He quit in January, just before News International began handing information to the police. He has always denied any knowledge of illegality.

‘Pursue the Truth’

Brooks is under pressure herself, having been editor of the News of the World in 2002. In 2003, she told a parliamentary committee that the paper had paid police officers for information in the past.

New York-based News Corp. is already facing a trial in January, when a court will decide how much the company should pay in damages to Bryant and four others alleged to be phone- hacking victims, including actor Jude Law. News International has apologized and agreed to pay about 100,000 pounds ($160,630) to settle claims brought by actress Sienna Miller and another 20,000 pounds to former soccer player Andy Gray.

The leader of the opposition Labour Party, Ed Miliband, called on Brooks to “consider her position” yesterday. Business Secretary Vince Cable told BBC television that “those people who were responsible have got to take the consequences.”

Takeover Review

The allegations come the same week Culture Secretary Jeremy Hunt holds a further consultation on News Corp.’s 7.8 billion- pound bid for the 61 percent of British Sky Broadcasting Group Plc it doesn’t already own. News Corp. already owns four of the U.K.’s largest newspapers. Cable said the takeover review “really doesn’t have anything to do with the hacking inquiry,” while Cameron said the BSkyB decision must be made in line with the law.

News Corp. rose 7 cents, or 0.4 percent, to $18.13 in New York yesterday. BSkyB, the U.K.’s biggest pay-television broadcaster, fell 7 pence or 0.8 percent to 838 pence at 9:21 a.m. in London today, valuing the company at 14.7 billion pounds.

“I have to tell you that I am sickened that these events are alleged to have happened,” Brooks said in a memo to staff. “If the allegations are proved to be true then I can promise the strongest possible action will be taken as this company will not tolerate such disgraceful behavior.”

Bryant accused the newspaper of “systematic criminality” and said London’s Metropolitan Police had “lied time and time again to Parliament.”

The previous police probe didn’t look at evidence of illegality beyond the hacking of phones belonging to members of the royal household. Senior officers have since defended their decision not to expand their investigation,

“They had all this information in their hands in 2006 and they did nothing with it,” Bryant said.

--With assistance from Blanche Gatt in London. Editors: Eddie Buckle, Kenneth Wong

To contact the reporters on this story: Robert Hutton in London at rhutton1@bloomberg.net; Jonathan Browning in London jbrowning9@bloomberg.net

To contact the editors responsible for this story: James Hertling at jhertling@bloomberg.net; Kenneth Wong at kwong11@bloomberg.net


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