FBI’s Murdoch inquiry a case of co-ordination with British

The FBI is just cranking up a preliminary review of whether alleged phone hacking and bribery by Rupert Murdoch’s media empire violated U.S. laws, but any resolution may well have to await the outcome of British investigations.

News Corporation head Rupert Murdoch enters the News Corp. building on Friday. The FBI is just cranking up a preliminary review of whether alleged phone hacking and bribery by Rupert Murdoch’s media empire violated U.S. laws.

News Corporation head Rupert Murdoch enters the News Corp. building on Friday. The FBI is just cranking up a preliminary review of whether alleged phone hacking and bribery by Rupert Murdoch’s media empire violated U.S. laws.

WASHINGTON — The FBI is just cranking up a preliminary review of whether alleged phone hacking and bribery by Rupert Murdoch’s media empire violated U.S. laws, but any resolution may well have to await the outcome of British investigations.

The FBI’s early fact-gathering could turn into a long saga that tests or reinforces the long-standing co-operation between U.S. and British law enforcement. Most of the records and witnesses to prove or disprove the allegations are in the hands of British investigators.

The problem for Murdoch is that his business, not just his now-shuttered British tabloid News of the World, faces investigations on two continents. That includes a nascent FBI probe. Depending upon what turns up, it could head in unexpected directions, perhaps threatening other Murdoch properties, which include the Fox television network.

News Corp., Murdoch’s New York-headquartered parent company, is assembling a gold-plated roster of lawyers to deal with any U.S. legal action. According to published reports, the company has signed up Brendan Sullivan, the high-priced Washington criminal defence attorney, and Mark Mendelsohn, an acknowledged expert on the Foreign Corrupt Practices Act

Sullivan is famous for defending Oliver North against Iran-Contra scandal charges and Sen. Ted Stevens, R-Alaska, against corruption counts. Mendelsohn ran the Justice Department unit that enforced the anti-foreign-bribery statute from 2005 to 2010.

News Corp., Sullivan and Mendelsohn would not confirm the hirings.

For now, U.S. investigators are not only looking at the phone hacking and bribery allegations but also kicking the tires on any other allegations against Murdoch entities that appear in print or even old court records. That includes reviewing old allegations from a civil lawsuit that a unit of News Corp. hacked into computers of a small advertising competitor in New Jersey and obtained confidential information it used lure away clients.

Separately, the FBI plans to question actor Jude Law about allegations his phone was hacked while he was in the U.S., according to the BBC. Law has sued the Murdoch-owned Sun tabloid for allegedly hacking into Law’s voicemail for stories about his private life.

The allegation about phone hacking in the United States rests on a single news story in the Daily Mirror, a London tabloid rival to Murdoch’s The Sun.

A former New York police officer-turned-private investigator, not identified by name, said he’d been contacted by News of the World journalists who offered to him to retrieve private phone records of victims in the Sept. 11 attacks in the United States.

According to the story, the ex-officer claimed reporters wanted the victim’s phone numbers and details of calls they had made and received in the days before the 2001 attacks, particularly those of British victims.

The story quoted an unidentified source as saying: “This investigator is used by a lot of journalists in America and he recently told me that he was asked to hack into the 9/11 victims’ private phone data. He said that the journalists asked him to access records showing the calls that had been made to and from the mobile phones belonging to the victims and their relatives.”

“His presumption was that they wanted the information so they could hack into the relevant voicemails, just like it has been shown they have done in the U.K. The PI said he had to turn the job down. He knew how insensitive such research would be, and how bad it would look.”

In the United States, the Mirror’s story jolted some Sept. 11 families into sorting through memories of what the news media said about them and their loved ones.

Attorney General Eric Holder has agreed to meet Sept. 11 family members who want to discuss the phone hacking allegation. Arrangements could be set up as early as this week.

If there are any U.S. victims of phone hacking, they are very unlikely to be aware of it. If there is evidence that any Sept. 11 families’ phones were hacked, most of it is likely in Britain, not in the U.S.

British authorities are reviewing seized documents that suggest perhaps thousands of British phones were hacked over the years on behalf of Murdoch journalists.

“We hope that the cellphones of the 9/11 victims and their relatives have not been hacked,” Norman Siegel, an attorney who has represented some families for eight years, said Saturday. “However, we strongly believe the FBI and the Justice Department are acting responsibly in continuing their investigations of this matter and the 9/11 families are offering their assistance.”

The U.S.-based parent company of Murdoch’s operations, News Corp., said that “we have not seen any evidence to suggest there was any hacking of 9/11 victim’s phones, nor has anybody corroborated what are clearly very serious allegations. The story arose when an unidentified person speculated to the Daily Mirror about whether it happened. That paper printed the anonymous speculation, which has since mushroomed in the broader media with no substantiation.”

Washington lawyer and former federal prosecutor Jay Darden is skeptical of the allegation.

“I think the Justice Department always has to be careful when opening up criminal investigations just based on sensational reports in a newspaper in another country. That’s why you want career officials making decisions, so that decisions not only to open an investigation but pursue it aren’t made for the wrong reasons,” said Darden, who has represented companies and executives in Foreign Corrupt Practices Act cases.

Darden, who is not representing News Corp. or other Murdoch holdings, was assistant chief of the Justice Department’s fraud section from 2006-2010.

Though reports of British journalists paying police for tips and information go back years, the practice is a crime in that country and British police are promising a crackdown.

That investigation would be an exclusively British matter, except for the long reach of the Foreign Corrupt Practices Act. That post-Watergate U.S. law has been used to prosecute U.S. companies that pay bribes to foreign officials to win business, usually foreign government contracts. News Corp. has its headquarters in New York.

In a statement Friday, News Corp. said that it had not seen any indication “of a connection or similarity between the events, allegations and practices being investigated in the U.K. and News Corp’s U.S. properties.”

U.S. legal authorities are divided over whether the corruption law even covers the bribes that journalists paid police. Federal officials have noted that the law has never been used to prosecute bribing an official for information that might increase newspaper circulation. Furthermore, U.S. officials would be reluctant to expend resources prosecuting bribes the British are already going after.

But other lawyers don’t see a problem if the facts warrant.

“It wasn’t a payment to obtain business, but it was done to get a business advantage,” said Alexandra Wrage, president of TRACE, an association that advises multinational companies on anti-bribery compliance. She cited a 1999 case in which company executives paid half a million dollars in bribes to Haitian customs officials to reduce import taxes on rice.

But if the law’s bribery provision is an iffy prospect for U.S. enforcement in this case, another part might not be.

If the U.S. financial records of News Corp. concealed payoffs by News of the World to police and someone at the U.S. parent company condoned it, that could well be a crime under the law, and one the British aren’t pursuing. That part of the law is designed to protect U.S. stockholders and investors, but any U.S. prosecution would have to wait until the British had first proved there were bribes.

The law is most often applied in Third World countries without a robust legal system. U.S. and British officials have long-standing agreements on handling overlapping criminal cases; those arrangements favour U.S. deference to Britain’s police payoffs probe.

Recently, the U.S. stepped aside as Britain’s Serious Fraud Office began investigating BAE Systems PLC, England’s largest arms company, for allegedly paying bribes to Saudi Arabia for contracts.

But when a British decision halted the investigation in 2007, the U.S. stepped in. The result: BAE was sentenced last year in federal court in Washington to pay a $400 million criminal fine in an FCPA-related case.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Artist Delree Dumont has painted an Indigenous mural at St. Joseph High School. (Contributed photo)
Indigenous mural painted on Red Deer high school walls

A new Indigenous mural now sits on the walls of St. Joseph… Continue reading

Red Deer College (Contributed photo)
RDC tuitions to go up 7%

Tuition increase the maximum allowed under provincial rules

This unicorn was stolen from the small community of Delia, northeast of Drumheller on Friday and was recovered, with its bronze horn broken off, on Saturday. RCMP are looking for information on the suspects.
(Photo from RCMP)
Unicorn statue stolen from Delia recovered

Statue found with horn broken off in field about 15 km from Delia

(Advocate file photo)
Lacombe man whose manslaughter sentence was rejected by judge has new lawyer

Judge rejected proposed seven-year sentence for manslaughter in connection with 2019 homicide

Prime Minister Justin Trudeau holds a news conference at Rideau cottage in Ottawa, on Friday, March 13, 2020. THE CANADIAN PRESS/Fred Chartrand
Liberals to release federal budget with eye on managing crisis, post-pandemic growth

OTTAWA — The federal government will this afternoon unveil its spending plans… Continue reading

A vial of the Medicago vaccine sits on a surface. CARe Clinic, located in Red Deer, has been selected to participate in the third phase of vaccine study. (Photo courtesy www.medicago.com)
Red Deer clinical research centre participating in plant-based COVID-19 vaccine trial

A Red Deer research centre has been selected to participate in the… Continue reading

University of Victoria rowing coach Barney Williams is photographed in the stands during the Greater Victoria Invitational at CARSA Performance Gym at the University of Victoria in Victoria, B.C., on Friday, November 29, 2019. The University of Victoria says Williams has resigned effective immediately. THE CANADIAN PRESS/Chad Hipolito
University of Victoria women’s rowing coach resigns by mutual agreement

VICTORIA — The University of Victoria says the head coach of its… Continue reading

Alberta NDP Leader Rachel Notley announces proposed new legislation to protect Alberta’s mountains and watershed from coal mining at a news conference in Calgary on Monday, March 15, 2021. A group of 35 scientists from the University of Alberta are urging the provincial government to rethink its plans for expanding coal-mining in the Rocky Mountains. THE CANADIAN PRESS/Jeff McIntosh
Alberta scientists urge adoption of bill that would protect against coal mining

EDMONTON — Some 35 scientists from the University of Alberta are urging… Continue reading

A driver shows identification to an Ottawa police officer as a checkpoint as vehicles enter the province from Quebec Monday April 19, 2021 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Quebec and Ontario impose travel restrictions to slow surging virus variants

Ontario and Quebec imposed new interprovincial travel restrictions on Monday amid growing… Continue reading

Education Minister Adriana LaGrange was in Red Deer on Friday to provide an update on the province's COVID-19 response in schools.
Photo by PAUL COWLEY/Advocate staff
LaGrange: Feedback needed to refine curriculum

As the Minister of Education my role has been guided by a… Continue reading

In this Feb. 24, 2020, photo, the Olympics rings are reflected on the window of a hotel restaurant as a server with a mask sets up a table, in the Odaiba section of Tokyo. The vaccine rollout in Japan has been very slow with less than 1% vaccinated. This of course is spilling over to concerns about the postponed Tokyo Olympics that open in just over three months.(AP Photo/Jae C. Hong, File)
Will Japanese Olympians be vaccinated ahead of the public?

TOKYO — The vaccine rollout in Japan has been very slow with… Continue reading

PSG's Kylian Mbappe, right, greets Bayern's Lucas Hernandez at the end of the Champions League, second leg, quarterfinal soccer match between Paris Saint Germain and Bayern Munich at the Parc des Princes stadium, in Paris, France, Tuesday, April 13, 2021. (AP Photo/Francois Mori)
PSG, Bayern the big names missing from Super League plan

DÜSSELDORF, Germany — The plan for the new Super League soccer competition… Continue reading

In this image released by Paramount Pictures, Marion Cotillard, left, and Brad Pitt appear in a scene from "Allied." (Daniel Smith/Paramount Pictures via AP)
Leo Carax’s ‘Annette’ to open Cannes Film Festival

Leo Carax’s “Annette,” starring Marion Cotillard and Adam Driver, will open the… Continue reading

From left, Producer Doug Mitchell, actor Chris Hemsworth and director George Miller attend at a press conference to announce the new "Mad Max" film at Fox Studios Australia in Sydney, Monday, April 19, 2021. (Mick Tsikas/AAP Image via AP)
‘Mad Max’ prequel shot in Outback to be released in 2023

SYDNEY, Australia — A prequel to the “Mad Max” movie franchise starring… Continue reading

Most Read