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Timothy Karr

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Murdoch Facade Crumbling As Scandal Takes Root In America

Posted: 07/22/11 06:38 PM ET

The U.S. Department of Justice (DoJ) is reportedly preparing to deliver subpoenas to News Corporation employees and others as part of its expanding investigation into possible violations of the Foreign Corrupt Practices Act.

A separate FBI investigation is underway in response to reports that the company may have hacked into the phone messages of victims of the September 11 attacks. (Free Press is part of a larger coalition of groups urging Washington to call News Corp. executives including Rupert Murdoch to testify before Congress )

The Foreign Corrupt Practices Act holds U.S. companies legally accountable for crimes committed abroad, especially bribes that are paid to foreign officials to protect and expand the company's business interests.

News Corp. is running its own campaign to downplay these allegations, distance father and son from the alleged crimes, and contain the scandal to the U.K. The Wall Street Journal and Fox News Channel are leading the charge with carefully contrived editorials and on-air stagecraft. One person with ties to News Corp. told The Journal that the DoJ subpoenas are "a fishing expedition with no evidence to support it."

Not according to British investigators, who received a trove of documents and emails from News International that identify at least $160,000 in bribes paid to police officers. This handover of evidence has been confirmed by more credible news outlets, including the New York Times and the Guardian, that have covered the unfolding investigations.

Robert Lenzner of Forbes writes that News Corp efforts to cover-up the scandal are now "cracking" as two former executives come forth to claim that James Murdoch wasn't telling the whole truth during his testimony before Parliament on Tuesday. One former executive, Tom Crone, should know. He served as part of the legal team that advised Murdoch, Jr. during an earlier investigation that involved phone hacking.

"When the full extent of the hacking and the amounts paid to police are known, the Murdochs' claim [that] they knew nothing of these activities -- and were betrayed -- will go up in smoke," Lenzner writes.

And as more leads indicate that crimes were indeed committed on U.S. soil -- including actor Jude Law's claim that his phone was hacked as he was passing through New York City's JFK Airport -- the likelihood increases that this scandal will create heat for the Murdochs on this side of the Atlantic.

More fish for the frying pan.

 

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