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Murdoch Blasted for Misconduct

Matt Kelly | May 1, 2012

The British Parliament has published its final report on the phone-hacking scandal at News Corp., a blistering critique that calls media mogul Rupert Murdoch “not a fit person” to lead the $33 billion conglomerate.

The report singled out numerous employees of News International, the European newspaper wing of News Corp., and said they lied to a House of Commons committee investigating the hacking scandal as far back as 2009. Neither Murdoch nor his son, James, were among that group, but the report went on to say: “Corporately, News International misled the committee about the true nature and extent of the internal investigations [it] professed to have carried out… Their instinct throughout, until it was too late, was to cover up rather than seek out wrongdoing and discipline the perpetrators.”

News Corp. has been reeling from the phone-hacking scandal—where employees hacked into the voicemail of murder victims, celebrities, and an unknown number of other individuals—since last year. James Murdoch, once seen as the heir-apparent to his 80-year-old father, has been forced to resign from many of his positions at the company, and other top Murdoch lieutenants have resigned or placed under arrest as well. Parliament's Culture, Media, and Sports Committee has been leading the investigation.

Rupert Murdoch did come under direct criticism for his testimony before Parliament last year, when he said that he didn't know about News International's phone-hacking because News International is such a tiny sliver of News Corp.'s total business.

The committee didn't buy that excuse. “This self-portrayal as a hands-off proprietor is entirely at odds with numerous other accounts” of Murdoch as a heavily involved manager, the report said. “It was, indeed, we consider, a misleading account of his involvement and influence with his newspapers.”

On a 6-4 vote, the committee then issued its assessment:

We conclude that, if at all relevant times Rupert Murdoch did not take steps to become fully informed about phone-hacking, he turned a blind eye and exhibited wilful blindness to what was going on in his companies and publications. This culture, we consider, permeated from the top throughout the organization and speaks volumes about the lack of effective corporate governance at News Corp. and News International. We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of a major international company.