Bloomberg News

Murdoch Says Committee Will Probe Phone Hacking, WSJ Reports

July 14, 2011

(Adds Murdoch’s comments about son in sixth paragraph.)

July 14 (Bloomberg) -- News Corp. Chairman Rupert Murdoch said the company will establish an independent committee to investigate allegations of wrongdoing by employees and that it had handled the crisis “extremely well,” the Wall Street Journal reported.

The committee will “investigate every charge of improper conduct,” Murdoch said in an interview with the Journal, which is owned by News Corp. The committee will be led by a “distinguished non-employee,” he said. He also said the company has made “minor mistakes” in dealing with the crisis.

Employees of News Corp.’s News of the World are accused of hacking hundreds of voicemails, including those of murder and terrorism victims, and bribing police for confidential information. The scandal led New York-based News Corp. to close the 168-year-old tabloid and drop its 7.8 billion-pound ($12.6 billion) proposed bid for full control of British Sky Broadcasting Group Plc.

The Federal Bureau of Investigation is examining whether News Corp. employees also tried to hack into the phones of Sept. 11 victims, according to a person familiar with the matter who wasn’t authorized to publicly discuss it.

In the Journal interview, Murdoch said the company isn’t separating its newspaper assets, which also include the U.K. tabloid Sun, the Times of London and the New York Post. The company will establish a “protocol for behavior” for reporters across the company, he said.

Defending James

Murdoch, 80, also defended his son James, who is News Corp.’s deputy chief operating officer and non-executive chairman of BSkyB. James dealt with the crisis “as fast as he could” and his position at News Corp. is unchanged, Murdoch said.

News Corp. declined 50 cents, or 3.1 percent, to $15.44 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have dropped 15 percent since the first reports on July 4 that News of the World employees in 2002 hacked the voice-mail messages of a missing teen who was later found murdered.

--Editors: Peter Elstrom, Ville Heiskanen

To contact the reporter on this story: Ville Heiskanen in New York at vheiskanen@bloomberg.net; Louisa Fahy in Washington at lnesbitt@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net


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