04/06/2012 02:55 pm ET Updated Jun 06, 2012

For Murdoch, the Sky Has Fallen

On Thursday, Sky News became the fifth enterprise owned by Rupert Murdoch to be implicated in criminal behavior since investigations into the phone-hacking scandal began. In this case, the news channel did so to gain information about a British man who faked his own death to collect insurance money.

A scandal that began with The News of the World's hacking of Prince William's voicemail, to ascertain, of all things, that he had borrowed an editing deck from a friend at a rival news organization, has spread to potentially thousands of individuals.

In addition to Sky News and The News of the World, News Corp. subsidiary News America Marketing settled a case in the United States over allegations that it had hacked into the computer system of a competitor, Floorgraphics.

In January, four reporters from The Sun were arrested "on suspicion of making illegal payments to police officers."

In Australia, News Corp. has been accused of cracking "the codes of smartcards issued to customers of rival pay-TV services and then [selling] black-market smartcards giving viewers free access to those services, costing rivals millions of dollars."

When the phone-hacking scandal began, News Corp. was insistent that no widespread criminal behavior existed throughout the company. With each passing week, it becomes clearer that is far from the truth.

While none of the scandals has thus far personally implicated Murdoch, what is clear is that he created a corporate culture where illegal behavior was not only tolerated, but encouraged. As The New York Times reported last July:

Mr. Murdoch expects his tabloids to beat the competition with aggressive, intrusive reporting that results in splashy exclusives that expose sexual misbehavior or debunk the establishment line. It is this expectation, former editors and reporters say, that has pushed his tabloids' editors into ever more adventurous news gathering practices.

The Sky case is particularly interesting because for the first time, the company has admitted that hacking was not only approved of, but in fact officially sanctioned by the management of the channel. John John Ryley, the head of Sky News, told reporters, "We stand by these actions as editorially justified and in the public interest." Ryley continued: "Material provided by Sky News was used in the successful prosecution, and the police made clear after the trial that this information was pivotal to the case."

Regardless of intentions or the criminal behavior of a target, it is not in the realm of a private entity to determine which laws to follow and which to ignore. It's because of this hubris, which runs up and down the News Corp. ladder, that the company has landed in this place.

Murdoch's quest for newspaper sales, ratings, and revenue is unmoored by the normal checks and balances a publicly traded corporation faces by design, and shareholders have suffered. The malfeasance has cost the company more than a quarter-billion dollars already, with more than $50 million in legal fees alone.

Normally there would be consequences for the head of such a company and his management team. But News Corp. has always been run more like a family fiefdom than an entity owned by thousands of shareholders. Therefore, Rupert will continue to escape consequences, and the one thing we can all be sure of is that more scandals are yet to come.

Read Ari Rabin-Havt's book The Fox Effect: How Roger Ailes Turned a Network into a Propaganda Machine.