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Murdoch flies to London to tackle phone-hack crisis

London, July 9, 2011

Rupert Murdoch was expected to fly into London this weekend to deal with an escalating phone-hacking crisis engulfing his British newspapers business.

The expected arrival 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 plans to take over a British broadcaster and has raised questions about the relationship between the media and politicians.

 News Corp declined to comment on 80-year-old Murdoch's agenda three days after he closed the News of the World, the 168-year-old best-selling tabloid newspaper at the heart of the allegations, in what has been widely interpreted as a damage-limitation exercise.

Rebekah Brooks, chief executive of News Corps' British newspaper arm indicated more revelations may emerge, a recording showed.

"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 told the newspaper's staff 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. Brooks denies knowledge of the practice.

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 and admitted politicians had been in thrawl to media for years.

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

A spokeswoman for News International, Murdoch's British media arm, said the allegation was "rubbish". She said: "We are cooperating actively with police and have not destroyed evidence."

Cameron's opponents on the left want to block the $22-billion bid on the grounds it would give Murdoch 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.

Murdoch, who began his British media arm in the 1960s, will be keen to save News Corp's bid to buy the 61 percent of broadcaster BSkyB , which it does not already own.

A source familiar with his plans said he was likely to arrive on Sunday morning. Analysts and investors said the 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 said on Wednesday it was 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 percent.




Tags: London | Murdoch | tabloid | phone-hack |

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