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Murdoch flies to London to tackle phone-hack crisis

Rupert Murdoch was expected to fly into London to tackle a phone-hacking crisis while journalists prepared the last edition of a newspaper they say he is sacrificing to safeguard his plans to expand his media business.

world Updated: Jul 10, 2011 07:45 IST

Rupert Murdoch was expected to fly into London to tackle a phone-hacking crisis while journalists prepared the last edition of a newspaper they say he is sacrificing to safeguard his plans to expand his media business.

The planned visit of the News Corp chief executive coincided with calls on Prime Minister David Cameron to speed up an inquiry into the scandal, which could jeopardise Murdoch's proposed takeover of a British broadcaster and has raised questions about relations between media and politicians.

News Corp, whose shares have fallen over the scandal, declined to comment on 80-year-old Murdoch's agenda.

A spokeswoman for News International, its British media arm, denied allegations an executive might have destroyed evidence relevant to a police inquiry into the allegations its reporters had hacked into the telephones of relatives of troops killed in action and a string of celebrities several years ago.

News International chief Rebekah Brooks indicated more revelations may emerge in comments to News of the World staff on Friday, a day after she told them the 168-year-old best-selling newspaper had become "toxic" and would be shut.

"Eventually it will come out why things went wrong and who is responsible. That will be another very difficult moment in this company's history," she said on Friday, according to a recording carried by Sky News.

Murdoch has brushed off calls for Brooks to resign due to her editorship of News of the World during some of the alleged hacking incidents. She denies knowledge of the practice.

Cameron, a friend and neighbour of Brooks, joined calls for her to step down on Friday at a news conference at which he admitted politicians had been in thrall to media for years.

The Guardian newspaper reported on its website that police were investigating evidence a News International executive may have deleted millions of emails from an internal archive in an apparent attempt to obstruct investigations.

The News International spokeswoman said the allegation was "rubbish". "We are cooperating actively with police and have not destroyed evidence."

Journalists working on Sunday's last edition of the News of the World were angered by the loss of their jobs, saying they had been made scapegoats to protect NewsCorp's expansion in television.

"There are 280 journalists there who have absolutely nothing to do with the things that may have gone on many, many years in the past," chief subeditor Alan Edwards told the British Broadcasting Corporation.

British police on Friday arrested Andy Coulson, the former spokesman for Cameron who had resigned as News of the World editor in 2007 after one of his reporters and a private investigator were convicted of hacking into the phones of aides to the royal family.

Coulson has also said he knew nothing about the phone hacking.

Cameron announced a full public inquiry into the hacking allegations at a hastily-convened news conference on Friday in which he was forced to defend his judgement in hiring Coulson.

The opposition Labour Party said on Saturday Cameron needed to appoint a judge quickly to get the inquiry going to avoid evidence disappearing, pointing to reports of destroyed emails.

"The clock runs out at the end of today," labour deputy leader Harriet Harman told the BBC. "We ought to take precautionary measures."

A spokesman for Cameron said he was moving as quickly as possible. "We have already approached the Lord Chief Justice who will propose the judge," the spokesman said, adding that any destruction of evidence would be a criminal matter.

Cameron's opponents on the left want to block Murdoch's bid for the 61% of broadcaster BSkyB NewsCorp does not already own on the grounds it would give him too much political clout.

After years of allegations about hacking the voicemail of celebrities and politicians in search of stories, the scandal reached a tipping point earlier this week when it was alleged that in 2002 the paper had listened to the voicemail of Milly Dowler, a missing schoolgirl who was later found murdered, and even deleted some of her messages to make way for more.

That claim, and allegations that a growing list of victims included Britain's war dead and the families of those killed in the 2005 London transport bombings, outraged readers and caused many brands to pull advertising from the title.

A source familiar with his plans said Murdoch, who began his British media arm in the 1960s, was likely to arrive in London on Sunday morning.

Analysts and investors said the 14 billion dollar takeover deal could be jeopardised if British regulators impose tougher rules in response to new concerns around News Corp's dominance in British media.

Britain's media regulator has said it is monitoring the hacking allegations to see whether it was "fit and proper" for News Corp to hold a broadcasting licence.

Murdoch, who had spent most of the week at a conference in Sun Valley, Idaho, has kept a low-profile since the scandal erupted. On Thursday, he refused to answer journalists' questions on the matter, referring them to a Wednesday statement in support of Brooks.

Cameron indicated a new assertiveness toward the Murdoch empire by withholding overt endorsement of News Corp's bid for BSkyB on Friday.

"This scandal is not just about some journalists on one newspaper," he said. "It's not even just about the press. It's also about the police. And, yes, it's also about how politics works and politicians too."

News of the World and other newspapers have been accused of paying the police for information. Police said on Friday they had arrested a 63-year-old man in Surrey, southern England over allegations of inappropriate payments to police. A police spokesman said the man was not a serving policeman.

Police also raided another tabloid, the Daily Star, earlier on Friday over allegations of phone hacking.

Shares in the pay-TV chain fell 7.6 percent after the media ministry also said it would take events at the News of the World into account before giving its approval to the takeover. News Corp shares in New York lost around 4%.

The prime minister's close links with those at the heart of the scandal mean he has been damaged by it but analysts say that with probably nearly four years until a parliamentary election he is unlikely to be sunk by it.

The 43-year-old Brooks, whose mane of red hair, sharp wit and seemingly charmed relationship with Murdoch have long made her an object of fascination for fellow tabloid journalists, has made clear she was staying on to manage News International.

Brooks denied the company, which many assume will fill the gap left by the News of the World by extending publication of its Sun daily to Sundays, was combining a cost-saving measure with a bid to remove a threat to its expansion in television.

The police also face tough questions over why an initial investigation into phone hacking was closed after royal correspondent Clive Goodman and a private detective were jailed in 2007.

Coulson was bailed until October after nine hours at a London police station. Asked if he was being made a scapegoat for the scandal, he told reporters, "I can't say any more at this stage. There's a lot I'd like to say, but I can't."

Goodman was re-arrested on Friday to answer questions about alleged payments to police officers. Several other journalists have been arrested in recent weeks as police pursue inquiries.