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News Corp. admits errors as panel calls Rupert Murdoch unfit leader

May 1, 2012 |  6:52 am

British lawmakers announce a scathing report saying Rupert Murdoch is unfit as company leader.
LONDON -- News Corp. says it is studying a report from a panel of British lawmakers that Rupert Murdoch “exhibited willful blindness” toward illegal phone hacking at the News of the World tabloid and that he "is not a fit person" to head a major international company.

The company said in a statement Tuesday morning, in responding to the scathing findings, that it “acknowledges significant wrongdoing at News of the World and apologizes to everyone whose privacy was invaded."

The panel stated that James Murdoch, the news tycoon’s son, showed poor leadership in failing to get to the bottom of the hacking scandal. Yet the lawmakers said that neither of the Murdochs had lied to Parliament about their knowledge of the extent of the problem.

But three other senior executives at News Corp. and the now-defunct News of the World -– including Les Hinton, one of Rupert Murdoch’s closest associates -– did mislead Parliament about how widespread the practice of snooping into cellphones was, the report said.

News International, News Corp.'s British arm, as a whole tried to hide the problem, suppressing documents and making statements to Parliament that were not completely truthful, according to the report.

"Their instinct throughout, until it was too late, was to cover up rather than seek out wrongdoing and discipline the perpetrators," the report said.

The stinging report by Parliament's committee on the media comes a week after Rupert and James Murdoch testified here before a judicial inquiry into media ethics. The report, months in the making, is certain to add pressure on the Murdochs as their global media empire struggles to deal with the continued fallout from the hacking scandal.

In particular, the report's most controversial statement, that Rupert Murdoch is unfit to lead an international company, could imperil News Corp.'s nearly 40% stake in the television company British Sky Broadcasting. British regulatory authorities are charged with determining whether major stakeholders such as Murdoch are "fit and proper" owners of mass media in Britain.

The committee's finding on Murdoch's unfitness was not unanimous. In fact, it led to a bitter split along party lines, with four Conservative Party members refusing to endorse the report on the grounds that such a declaration was outside the scope of the panel's investigation.

The report was approved on a 6-4 vote.

Committee members stressed they were completely agreed on their finding that three of Murdoch’s senior executives essentially lied to Parliament about phone hacking, which News International insisted for years was confined to one "rogue reporter."

One of those executives, Colin Myler, is now the editor of the Murdoch-owned New York Daily News.

Though misleading Parliament is a serious offense, it is unclear what punishment can actually be applied.

The committee called it "astonishing" that Rupert and James Murdoch took so long to find out that phone hacking went far beyond a lone reporter. Police say that thousands of people may have had their phones hacked into by the News of the World in its pursuit of sensational stories.

The scandal exploded in the public consciousness last summer with the revelation that among the hacking victims was a 13-year-old girl who was kidnapped and later found slain.

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-- Henry Chu

Photo: British Conservative member of Parliament Louise Mensch speaks at a news conference on the scathing report "News International and Phone-Hacking" on Tuesday. Credit: Carl Court / AFP/Getty Images

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