Murdoch to jet in for crisis talks over Sun arrests

Feb 12, 2012
David Cairns

News Corp boss says paper will continue - but US investigation threatens global empire

RUPERT MURDOCH will fly in to London this week for a crisis meeting with News Corp bosses after police arrested eight people on Saturday, including five Sun employees, over alleged bribery and corrupt payments to public officials and police.

Those arrested were said to include the newspaper's associate editor, picture editor, chief reporter and chief foreign reporter. Also arrested were an employee of the MoD, a member of the armed forces and a Surrey Police officer.

The men were questioned for Operation Elveden, the Met's inquiry into bribery allegations, which in turn sprang from evidence uncovered by the Operation Weeting phone-hacking investigation. They have all been released on bail.

Murdoch's imminent arrival has prompted fears he might shut the Sun down, just as he did the News of the World. But a company memo yesterday assured staff that the 80-year-old media baron maintains a "total commitment to continue to own and publish" the newspaper.

However, Murdoch's London trip certainly does betoken the seriousness with which he is viewing the arrests. They mark a crisis for the whole of News International, not just its British arm, because they will be seized on by investigators in the US, says The Guardian.

American authorities are already looking into alleged bribery at Murdoch's empire. News Corp's headquarters are in New York, which means it can be held accountable in the US for acts of bribery committed abroad (in this case the UK), under the Foreign Corrupt Practices Act (FCPA).

The consequences of the US investigation could be more than severe. The Guardian recalls that Siemens was fined $800m under the FCPA in 2008, while former telecommunications executive Joel Esquenazi – who was a company president - is serving a 15 year sentence for bribery committed in Haiti.

The inquiry is likely to consider whether any News Corp top brass were culpable, an expert in FCPA law told the paper, which notes that James Murdoch, son of Rupert and chairman of News Corp in Europe, has already been questioned in Parliament over how much he knew about the phone hacking scandal.

According to The New York Times, meanwhile, the Justice Department has already asked British police to share their evidence, for which the Met, in turn, has relied heavily on co-operation from News Corp itself. There is so much paperwork and data involved that the police needed assistance to find relevant information.

The scale of any fine imposed on News International in the US will be drastically affected by how co-operative the organisation is during the investigation, which may explain why the company now seems to be bending over backwards to help UK investigators.

In fact, News Corp has been so co-operative – the NY Times reports it has handed over "receipts, expenses reports, messages and other internal documents" – that it seems to have estranged its frontline staff in the process.

The NY Times notes that, among former employees of The News of the World, "there is cynicism about the motivations of their former employer". Some feel the management is "protecting itself and serving up journalists".

And the unions have criticised News Corp for "handing staff over to the police" without mounting an internal inquiry first. NUJ deputy secretary Barry Fitzpatrick said: "It’s a very brutal way of treating senior journalists who may or may not have done anything wrong."

As for the future of the Sun, if Murdoch does terminate his UK flagship, it could spell sunset for the rest of his papers. Without the milch-cow tabloid, there would be little incentive to maintain the loss-making Times and Sunday Times.

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