Dial M for Murdoch: News Corporation and the Corruption of Britain (39 page)

This, then, was the Murdoch’s defence: they had only realized the previous year that hacking had been widespread at Wapping. Alas, the company’s external lawyers, the Metropolitan Police and the Press Complaints Commission had all failed to detect the wrongdoing.

The questioning passed to Tom Watson, who, as he had planned, concentrated on Rupert. ‘Mr Murdoch senior, good afternoon, sir,’ he said breezily. ‘You have repeatedly stated that News Corp has zero tolerance to wrongdoing by employees. Is that right?’

‘Yes,’ replied Rupert.

‘In October 2010, did you still believe it to be true when you made your Thatcher speech and you said, “Let me be clear: we will vigorously pursue the truth – and we will not tolerate wrongdoing”?’

‘Yes,’ replied Rupert again, apparently coached to answer economically.

‘So if you were not lying then,’ Watson said, ‘somebody lied to you. Who was it?’

‘I don’t know,’ Murdoch said grumpily. ‘That is what the police are investigating, and we are helping them with.’

‘But you acknowledge that you were misled.’

‘Clearly.’

Watson took him back to 2003, when Rebekah Brooks had admitted the company had paid police for information in the past. Did anyone in News Corp or News International investigate that at the time?

Rupert paused. ‘No.’

‘Can you explain why?’

‘I didn’t know of it,’ he replied. ‘I’m sorry,’ the tycoon added tetchily. ‘Allow me to say something?’ He started slapping the table with his hand, which he had a habit of doing when he wanted to emphasize his exasperation. ‘And this is not [slap] an excuse [slap]. Maybe it is an explanation of my laxity [slap]. The
News of the World
is [slap] less than [slap] 1 per cent of our company. I employ 53,000 [slap] people around the world [slap] who are proud and great and ethical [slap] and distinguished people – professionals in their line. And [slap] perhaps I am spread [too thin] watching and appointing [slap] people whom I trust [slap] to run those divisions.’

Watson continued: ‘If I can take you forward to 2006: when Clive Goodman was arrested and subsequently convicted of intercepting voicemails, were you made aware of that?’

Rupert replied: ‘We worked with the police on further investigations, and eventually we appointed – very quickly appointed – a very leading firm of lawyers in the City to investigate it further …’

This was unwelcome detail. James jumped in: ‘Perhaps I can help here – ?’

‘I will come to you in a minute, sir. Just let me finish my line of questioning and then I will come to you.’ He turned to Rupert: ‘What did you personally do to investigate that after Mr Goodman went to prison? You were obviously concerned about it.’

‘I spoke to Mr Hinton who told me about it.’

Watson paused. ‘Okay.’ He said: ‘In 2008, another two years, why did you not dismiss
News of the World
chief reporter Neville Thurlbeck, following the Mosley case?’

‘I had never heard of him.’

Watson queried: ‘Despite a judge making clear that Thurlbeck set out to blame two of the women involved?’

‘I didn’t hear that.’

‘A judge made it clear Thurlbeck set out to blackmail two of the women involved in the case.’

To the surprise of those who had followed the
News of the World
’s recent history, News Corp’s chief executive replied: ‘That is the first I have heard of that.’

Watson continued: ‘Do you agree with Mr Justice Eady when he said that the lack of action discloses a remarkable state of affairs at News International?’

‘No.’

Turning to the corruption of the Metropolitan Police, Watson asked whether Lord Macdonald had found ‘evidence of indirect hacking, breaches of national security and evidence of serious crime in the Harbottle & Lewis file’.

‘He did indeed.’

James, growing ever more concerned, interjected: ‘Mr Watson, please, I can address these in some detail, if you will allow me.’

‘I will come to you, Mr Murdoch, but it is your father who is responsible for corporate governance …’

Had Murdoch senior been informed about the payments to Gordon Taylor and Max Clifford?

‘No.’

At what point had News Corp’s chairman and chief executive discovered that criminality was endemic at the
News of the World
?

‘Endemic is a very hard, wide-ranging word,’ Murdoch protested. ‘… I became aware as it became apparent.’

Hadn’t the Culture Committee’s last report referred to the ‘collective amnesia’ of his executives? ‘I haven’t heard that,’ Rupert replied. ‘I don’t know who made that particular charge.’

Watson reminded him: ‘We found your executives guilty of collective amnesia,’ adding: ‘I would have thought that someone would like to bring that to your attention; that it would concern you. Did they forget?’

‘No.’

Jim Sheridan, the veteran Labour MP, asked Rupert to confirm that he had entered Downing Street by a back door to visit David Cameron days after the election, asking if it was at Cameron’s request.

‘I was asked would I please come in through the back door,’ Rupert replied, avoiding giving the precise answer sought.

Sheridan remarked: ‘It is strange, given that heads of state manage to go in the front door.’

He asked: ‘Have you ever imposed any preconditions on a party leader in the UK before giving them the support of your newspapers?’

‘I never guaranteed anyone the support of my newspapers,’ News Corp’s chief executive replied, becoming more loquacious. ‘We had been supporting the Thatcher government and the Conservative government that followed. We thought it had got tired and we changed and supported the Labour Party thirteen years ago, or whenever it was, with the direct loss of 200,000 circulation.’

‘Did you ever impose any preconditions on either the Labour or Conservative Party?’

‘No.’

Who, wondered Sheridan, did Murdoch blame for the scandal, the closure of the
News of the World
and the loss of the BSkyB bid?

‘A lot of people had different agendas, I think, in trying to build this hysteria,’ Rupert replied, his accent still heavily Australian despite three decades in the US. ‘All our competitors in this country formally announced a consortium to try and stop us. They caught us with dirty hands and they built the hysteria around it.’

Did he accept that he was ultimately ‘responsible for this whole fiasco’?

‘No.’

Sheridan pressed: ‘Who is responsible?’

‘The people that I trusted to run it, and then maybe the people they trusted. I worked with Mr Hinton for fifty-two years and I would trust him with my life.’

Why hadn’t Wapping disclosed emails in the Tommy Sheridan perjury case?

James said: ‘I do not have direct knowledge of that, Mr Sheridan. I apologize, but certainly if you have additional questions on that in the future, I am happy to supply written answers, but I do not have direct knowledge and I am not in a position to answer those questions.’

He explained that he had settled the Taylor case after receiving legal advice about the cost of fighting it: ‘It was advised that, with legal expenses and damages, it could be between £500,000 and £1 million or thereabouts. I do not recall the exact number of the advice. I think that it was £250,000 plus expenses, plus litigation costs, something like that.’

Adrian Sanders, a Liberal Democrat and one of the committee’s most assiduous questioners, asked: ‘Was part of the advice that a high payment would ensure the matter was kept confidential?’

‘No, not at all. Out-of-court settlements are normally confidential,’ replied James who – at that time unbeknownst to the committee – had been copied into an email chain saying hacking was ‘rife’.

Sanders pressed on: ‘The
New Statesman
carried a story last week that News International subsidized Andy Coulson’s wages after he left your employ. Can you shed any light on that?’

‘I have no knowledge of Andy Coulson’s wages after he left the company’s employment.’

Sanders asked: ‘Finally, are you familiar with the term “wilful blindness”?’

‘Mr Sanders,’ James said wearily, ‘would you care to elaborate?’

Sanders explained: ‘It is a term that came up in the Enron scandal. “Wilful blindness” is a legal term. It states that if there is knowledge that you could have had and should have had, but chose not to have, you are still responsible.’

Seemingly perplexed, James responded: ‘Mr Sanders, do you have a question? Respectfully, I just do not know what you would like me to say.’

‘The question was whether you were aware –’

James snapped: ‘I am not aware of that particular phrase.’

Sanders: ‘But now you are familiar with the term, because I have explained it to you.’

Deadpan, with his eyes still glinting, James replied: ‘Thank you, Mr Sanders.’

‘I have heard the phrase before,’ chipped in his father, ‘and we were not ever guilty of that.’

Asked about the frequency of his contact with editors, Rupert said he occasionally rang the editor of the
News of the World
on a Saturday night to ask: ‘Have you got any news tonight?’ ‘I ring the editor of
The Sunday Times
[John Witherow] nearly every Saturday,’ he added, ‘not to influence what he has to say at all. I am very careful always to premise any remark I made to him by saying, “I’m just inquiring”.’

‘I’m not really in touch,’ added the proprietor.
*
‘I have got to tell you that, if there is an editor that I spend most time with, it is the editor of the
Wall Street Journal
, because I am in the same building. But to say that we are hands-off is wrong; I work a ten or twelve-hour day, and I cannot tell you the multitude of issues that I have to handle every day. The
News of the World,
perhaps I lost sight of, maybe because it was so small in the general frame of our company, but we are doing a lot of other things too.’

Philip Davies, the Conservative MP who the previous year had complained Labour MPs had hijacked the committee’s last report on NI, now displayed a more robust touch. He asked: ‘Surely in your weekly conversations with the editor of the
News of the World
, with something as big … as paying someone £1 million or £700,000, you would have expected the editor just to drop it into the conversation at some point during your weekly chat?’

Rupert replied simply: ‘No.’

Davies pressed: ‘You wouldn’t have expected them to say that to you?’

‘No … He might say, “We’ve got a great story exposing X or Y” or, more likely, he would say, “Nothing special”. He might refer to the fact that however many extra pages were dedicated to the football that week.’

‘But he wouldn’t tell you about a £1 million pay-off?’

‘No.’

To the suggestion that the
News of the World
had been shut to protect Rebekah Brooks, Rupert answered: ‘The two decisions were absolutely and totally unrelated.’

‘So when you came into the UK and said that your priority was Rebekah Brooks, what did you mean?’ asked Davies.

Looking confused, Rupert replied: ‘I am not sure I did say that; I was quoted as saying that. I walked outside my flat and had about twenty microphones stuck at my mouth, so I’m not sure what I said.’

‘You were misquoted, so to speak?’

Perhaps knowing that the remark had been captured by TV crews, he replied: ‘I am not saying that. I just don’t remember.’

The Murdochs were clearly struggling to give straightforward answers.

Paul Farrelly MP asked whether News Corp had been paying Glenn Mulcaire’s legal fees.

James started: ‘As I said earlier in answer to a question from Mr Davies …’

Farrelly interrupted: ‘Let’s keep it short. Yes or no? It is a yes or no question.’

James responded blankly: ‘I do not know the current status of this. You asked the question have I paid all Mr Mulcaire’s legal fees.’

Farrelly: ‘Have you been paying legal fees for Glenn Mulcaire during the course of the civil actions?’

‘I don’t know the details of the civil actions,’ James added, ‘but I do know that certain legal fees were paid for Mr Mulcaire by the company.’ He added: ‘I was as surprised and shocked to learn that as you are.’

Farrelly said: ‘Can you understand that people might ask why a company might wish to pay the legal fees of a convicted felon, who has been intimately involved in the destruction of your reputation, if it were not to buy his cooperation and silence?’

‘No, it is not,’ James protested. ‘I can understand that, and that is exactly why I asked the question – when the allegations came out, I said: “How can we? Are we doing this? Is this what the company is doing?”… I am not a lawyer, but these are serious litigations and it is important for all of the evidence from all of the defendants to get to court at the right time. The strong advice was that from time to time it is important, and customary even, to pay a co-defendant’s legal fees. I have to rest on counsel’s advice on some of these serious litigation matters.’

Farrelly tried again: ‘Is the organization still contributing to Glenn Mulcaire’s legal fees?’

‘As I said earlier, Mr Farrelly,’ James replied deadpan, ‘I do not know the precise status of that now, but I do know that I asked for the company to find a way for those things to cease with respect to these things.’

‘Will you let us know?’

‘I am happy to follow up with the committee on the status of those legal fees.’

Farrelly would not give in. Turning to Rupert, he said: ‘Is it not time for the organization to say: “Enough is enough”? This man allegedly hacked the phone of the murdered schoolgirl Milly Dowler. Is it not time for your organization to say: “Do your worst. You behaved disgracefully. We are not going to pay any more of your costs”?’

Rupert responded: ‘I would like to do that. I do not know the status of what we are doing, or indeed what his contract was and whether it still has any force.’

‘If the organization is still paying his fees, will you give the instruction now that that should stop?’

‘Provided that it is not in breach of a legal contract, yes,’ Rupert replied.