New Arrests Rock Murdoch Empire

Rupert Murdoch and Rebekah Brooks.
(photo: Barry Batchelor/PA)

By Jamie Doward, The Observer UK

12 February 12

Five senior journalists are held in police corruption probe amid speculation over future of the Sun

upert Murdoch is expected to fly to Britain this week to tackle the latest allegations to rock his media empire, involving the corruption of public officials by Sun journalists.

The deputy editor, Geoff Webster, chief reporter John Kay, picture editor John Edwards, chief foreign correspondent Nick Parker and deputy news editor John Sturgis were arrested in early morning raids on suspicion of bribing police and public officials. There was also a search of the Sun's offices. A Surrey police officer, a member of the armed forces and a Ministry of Defence employee were also arrested.

Part of Operation Elveden, Scotland Yard's investigation into newspaper corruption, the arrests follow those of four former and current Sun journalists and a serving Metropolitan police officer.

Senior Sun employees Chris Pharo and Mike Sullivan, executive editor Fergus Shanahan and News International's editorial development director, Graham Dudman, were arrested on 28 January. Rebekah Brooks, the Sun's former editor, and Andy Coulson, ex-editor of the News of the World, have also been questioned. The arrests have prompted speculation that News Corp, News International's US-based parent company, may be forced to consider closing the Sun, as it did with the News Of The World, in an attempt to protect the Murdoch empire.  READ MORE

How Bad Is News Corp.? Michael Wolff on the state of the Murdoch empire and its Mob-like structure

n my biography of Rupert Murdoch, I referred to News Corporation as Mafia-like, provoking the annoyance of my publisher’s libel lawyers. I explained to them that I did not mean to suggest this was an organized crime family, but instead was using “mafia” as a metaphor to imply that News Corp. saw itself as a state within a state, and that the company was built on a basic notion of extended family bonds and loyalty.

But just because it’s a metaphor doesn’t mean it isn’t the real thing, too.

Well-sourced information coming out of the Department of Justice and the FBI suggests a debate is going on that could result in the recently launched investigations of News Corp. falling under the RICO statutes.

RICO, the Racketeer Influenced and Corrupt Organizations Act, establishes a way to prosecute the leaders of organizations—and strike at the organizations themselves—for crimes company leaders may not have directly committed, but which were otherwise countenanced by the organization. Any two of a series of crimes that can be proven to have occurred within a 10-year period by members of the organization can establish a pattern of racketeering and result in draconian remedies. In 1990, following the indictment of Michael Milken for insider trading, Drexel Burnham Lambert, the firm that employed him, collapsed in the face of a RICO investigation.
Among the areas that the FBI is said to be looking at in its investigation of News Corp. are charges that one of its subsidiaries, News America Marketing, illegally hacked the computer system of a competitor, Floorgraphics, and then, using the information it had gleaned, tried to extort it into selling out to News Corp.; allegations that relationships the New York Post has maintained with New York City police officers may have involved exchanges of favors and possibly money for information; and accusations that Fox chief Roger Ailes sought to have an executive in the company, the book publisher Judith Regan, lie to investigators about details of her relationship with New York police commissioner Bernie Kerik in order to protect the political interests of Rudy Giuliani, then a presidential prospect.

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Rupertgate Thursday - The Games Begin.

Posted: 14 Jul 2011 07:00 PM PDT
Could be interesting - could be inflammatory - can't be boring.

BBC Radio 4 - PM Program - Murdoch segment - July 14, 2011

Click here to view this media

As it was reported less than an hour ago (at 9:00 am PDT), both James and Rupert Murdoch will be appearing before the Home Affairs Select Committee regarding the scandal, the fallout and the firestorm.

While momentum has been building and speculation increasing over what possible or probable repercussions are to be had here in the U.S. still remain to be seen, news and events surrounding this scandal are not going away in the UK anytime soon.

If anything, the Hearings, starting with Rebekah Brooks next Tuesday, should be interesting. Whether they will shed any light on what has been a long-running method of operation and a style of doing business is still a big question mark.

Here is the latest news as reported on the BBC 4 program PM, including an extended interview with Vince Cable, another figure who entanglements with Newscorp/News International cost him considerably.

The day ain't over and anything can still happen. And true to form, it just may.

Stay tuned.

Murdoch to Outgoing Execs: Thanks for Everything, Here's a Load of Money

The Daily Mail is reporting today that multi-million-dollar severance packages are in store for many of the top News Corp. executives claimed as early casualties of the phone hacking scandal now engulfing Rupert Murdoch's media empire. Rebekah Brooks, the fiery-haired former boss of the company's British newspaper division who resigned just yesterday, is said to be in line for a $5.6 million payout. Others likely to leave with a well-padded envelope (or, rather, bank account) include the final editor of News of the World, the Sunday tabloid at the center of the hacking allegations, two top News Corp. lawyers, as well as recently-departed Dow Jones CEO Les Hinton. One condition of the severance deals: gagging orders so none of them get the company in any more trouble than it's already in.

Rebekah Brooks in line for £3.5m pay out [Daily Mail]