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13 July 2011

Will News Corp face investigation in the US?

A Senator has called for practices of Murdoch's US journalists to be examined, raising the stakes fo

By Samira Shackle

Jay Rockefeller, a key Democratic senator and chairman of the Senate commerce committee, has called for the authorities to investigate whether journalists at Rupert Murdoch’s News Corporation targeted US citizens. In a written statement, he said:

I encourage the appropriate agencies to investigate to ensure that Americans have not had their privacy violated.

The reported hacking by News Corporation newspapers against a range of individuals — including children — is offensive and a serious breach of journalistic ethics. This raises serious questions about whether the company has broken US law.

Rockefeller is the first significant figure in Congress to call for an investigation, and his intervention adds weight to the growing ranks of pressure groups demanding one.

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Jodi Seth, chairman of the Senate sub-committee on communications, told the Daily Telegraph that an inquiry is currently unlikely:

We’re keeping an eye on the situation, but are not planning on looking into it at this time. For now, all that is certain is that there was hacking in Britain, which is outside of our jurisdiction.

But as the pressure builds, this may change. The Daily Mirror has already claimed that News of the World reporters attempted to bribe a New York police officer for access to the phone records of victims of the September 11 attacks. If this is substantiated, it will have far-reaching repercussions in the US. Republican politicians in particular have close ties to Murdoch because of his Fox News network, but it is unlikely that this would take priority over their commitment to terror victims and war veterans.

Despite Seth’s statement, the very public nature of the case might eventually make it difficult for regulatory agencies to turn a blind eye, given the emphasis they place on deterrence. Les Hinton, now chief executive of Dow Jones in the US, was formerly head of News International and is directly implicated in the case. Robert Thomson, editor of the Wall Street Journal, formerly edited the Times

If the scandal continues to widen out from the News of the World, the suggestion that corrupt practices infected the whole company could make a US investigation inevitable. The Center for American Progress Action Fund, run by John Podesta, former chief of staff to Bill Clinton, is organising a petition on this basis, saying:

Although initial reports focused on the U.K. paper News of the World, recent reports suggest that this disturbing conduct extended to several other News Corp properties.

“Given the seriousness of these allegations, we ask that you immediately begin an investigation of all entities controlled by News Corp, including domestic subsidiaries such as Fox News, The Wall Street Journal, and the New York Post.

Yet another possibility is that the Security and Exchanges Commission (SEC), a federal regulatory agency, will look into whether News Corp has violated the Foreign Corrupt Practices Act, which makes it a crime for any American-linked company to bribe foreign officials to obtain or keep business. This could make action on UK soil — such as paying police officers or royal staff for information and contact details — a criminal offence in the US.

Given that the vast majority of Murdoch’s empire is made up of his US assets — Fox News, the Wall Street Journal, the New York Post and 20th Century Fox — this could be a catastrophic development for the company.