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October 7, 2022updated 19 Oct 2022 6:41am

How News Corp sacrificed journalists’ sources to save the company

By Tom Hagler

In 2011, the owner of the News of the World (News Corp) made the unprecedented decision to hand over millions of internal emails to the Met Police identifying sources paid for information by journalists.

Some 34 journalists were arrested and/or charged with many spending years on police bail before standing trial. All those who stood trial were ultimately acquitted.

However, 26 sources were convicted of misconduct in a public office under Operation Elveden with 16 jailed for a total of more than 20 years.

In his new book Broken Yard, former journalist Tom Harper investigates failings at the Met Police and sheds new light on actions by News Corp which many journalists still see as a shameful betrayal of journalistic values.

This excerpt from the book picks up the story in 2011 as News Corp battled to tackle the fallout from the hacking scandal.

‘A friendship of convenience’

At the top of Tower 42, a £300 million skyscraper at the heart of the City of London, two embattled British institutions were circling the wagons in a quest to keep the wolves at bay.

In the middle of the Leveson inquiry, senior Met Police officers and lawyers from Scotland Yard and News International (NI), the UK division of the Murdoch media empire, assembled in a boardroom to plot a joint response to an unprecedented scandal.

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Outrageous behaviour by Rupert Murdoch’s tabloid newspapers was being exposed on an almost weekly basis.

From the Prime Minister downwards, politicians from both major political parties had been so shocked by the public backlash to the phone hacking revelations that neither the police nor the hacks could expect any further favours.

Now the scandal had forced the Met to open a new investigation. There was a snag, of course. The UK’s laws protect material gathered for the purposes of journalism.

If the police want to seize servers or files from a newspaper group they must first convince a judge that the evidence is relevant to a criminal investigation. Then the rules of ‘journalistic privilege’ no longer apply.

Under normal circumstances, law enforcement and media organisations do not make cosy partners. But Murdoch’s News Corp was now openly co-operating with Scotland Yard.

On 25 March 2011, Scotland Yard and NI signed a legal agreement mandating the company to ‘voluntarily co-operate in, produce, disclose and make available’ all documents ‘relevant’ to the investigation.

They included the computers and phone records of named journalists, including Rebekah Brooks and Andy Coulson, stretching back to 1997.

Under the agreement, the company also agreed to disclose “all documents in respect of editorial policy in dealing with sources, source-related issues, e.g., handling, recruitment, payment, etc.”.

The agreement was signed by Deputy Assistant Commissioner Sue Akers on behalf of the Met.

Akers told senior officers that the Met was constrained by privilege issues and had little choice but to negotiate with one of the main targets of its investigation. She described it as a “friendship of convenience rather than a marriage made in heaven”.

The relationship would certainly prove convenient for Rupert Murdoch.

In July 2011, in the wake of the Milly Dowler scandal, NI closed the News of the World, then the biggest-selling newspaper in the UK.

In what seemed like a frantic attempt to construct a new image of robust corporate governance, the company announced a new ‘management and standards committee’ (MSC) headed by Lord Grabiner QC and reporting directly to the US parent company’s board of directors in New York.

By October, the Met had identified over 300 million office emails and more than 16,000 boxes of NI material relevant to their inquiries. On 6 October 2011, a meeting between senior Met officers and company executives discussed the ongoing investigation. Akers was present for the Met, while Will Lewis, the former editor of the Daily Telegraph, represented the MSC.

Minutes of the meeting noted that all parties decided the ‘best option’ for the Met was to continue being fed evidence by the company, although they accepted it created the “perception of a close relationship between the MPS and NI”.

In November 2011, another meeting took place. Will Lewis asked the Met over and over again about ‘corporate vulnerability’ and the potential for ‘corporate charges’. DCS Gordon Briggs told him that prosecutors were “nervous about the MSC being asked to provide the evidence [as] you are employed by people who may become subject to charges”.

Lewis replied that NI’s new management standards committee had been ‘structured’ in a way to prevent any conflict and promised the company was not engaged in ‘tactical disclosure’. According to the minutes, Lewis said the MSC reported to Joel Klein – a former White House lawyer who was now executive vice-president of News Corp in the US.

In April 2012, Sue Akers asked Lord Grabiner for minutes of NI board meetings to determine “any potential indictment around corporate liability”. By this point, the phone hacking scandal was crashing through Murdoch’s defences and threatening to drag him into the case in person.

Corporate charge could kill the company

On 18 May Akers again wrote to Grabiner to confirm there was an ‘active investigation into the corporate liability of News International in relation to phone hacking and illegal payments to public officials’. This development caused pandemonium in Murdoch’s New York HQ.

A News Corp analysis of the effects of a broad corporate charge warned that the consequences could “kill the corporation and 46,000 jobs would be in jeopardy”. Executives were worried about the conglomerate’s ability to operate in the US if the serious corporate charges envisaged by Akers were brought against the company in London.

NI’s London lawyers pleaded with the Met and the CPS not to prosecute the company as it would not be in the ‘public interest’ to put thousands of jobs at risk. Gerson Zweifach, the American group general counsel of News Corp, flew to London to join emergency talks in Tower 42.

He told the police: “Crappy governance is not a crime. The downstream effects of a prosecution would be apocalyptic. The US authorities’ reaction would put the whole business at risk, as licences would be at risk.”

Shortly after News Corp was warned it was under corporate investigation, US executives ordered the company to scale back its co-operation with the Met.

A month later, Murdoch announced he was splitting the empire he’d spent six decades building into one of the most powerful companies in the world. The 82-year-old tycoon hived off his highly profitable television and film assets – among them 21st Century Fox and Fox News – into a separate entity, leaving his lesser media assets lumped together in what was widely perceived as an attempt to prevent his diseased British arm from infecting his American stock.

Lawyers for News Corp continued to plead with Scotland Yard not to prosecute the company, citing a recent case involving Southwark Council in south London, which avoided corporate manslaughter charges by providing full co-operation with an investigation into a fire that ripped through a dilapidated tower block, killing six people.

The diminishing co-operation with NI appeared to be unnerving the Met. Previously unpublished minutes of meetings in Tower 42 between senior police officers and the company’s lawyers show that Scotland Yard then came up with a remarkably benevolent assurance.

At a meeting on 1 June 2012, Grabiner said he was ‘mystified’ by the way the investigation was heading as he thought there had been a ‘presumption’ there would be no corporate charges if the company co-operated.

Akers replied that she had “never said that police would not look at corporate liability, and would always go where the evidence took us”. The Met’s deputy assistant commissioner then suggested the opposite. Akers said that the MSC should continue to provide ‘voluntary co-operation’ but assured its lawyers that Scotland Yard was “not looking … to try and get information re Rupert Murdoch”. Very nice of them, all things considered.

It is also clear from the minutes that the CPS could have charged News Corp with corporate offences – but chose not to do so. They reveal that the legal advice from UK prosecutors was that corporate liability “does lie at editor level” and that both Rebekah Brooks and Andy Coulson had recently been cautioned for additional corporate offences.

In one meeting, Akers told News Corp lawyers that the ‘editors’ were the ‘controlling mind’ and “we think corporate liability offences are made out”’.  But the corporate charges never materialised, even when Coulson, the former News of the World editor, was convicted of phone hacking.

During his trial, he was forced to admit that he had listened to recordings of hacked voicemails – the messages left by former Home Secretary David Blunkett for his girlfriend, Kimberly Quinn. If an editor’s criminality amounted to corporate liability, as the Met was hinting, then NI was dead in the water. With Coulson behind bars, it almost didn’t matter that a jury later found Brooks not guilty of all the charges she faced.

The jury decided that she had no knowledge of her staff hacking phones or paying public officials. It further cleared her of conspiracy to pervert the course of justice.

A former senior Met officer reviewed the minutes of the Tower 42 meetings. His view on the lack of police interest in Rupert Murdoch, and the failure to press corporate charges against News Corp, is stark: “That is unhelpful for the Met. It looks like they are colluding to keep the corporate entity out of the charges. It doesn’t read well.”

Operation Elveden

Many considered the charges in Operation Elveden to be unfair as the journalists had operated within an industry culture that had existed for decades. The witch-hunt collapsed after the Court of Appeal ruled that for journalists to be convicted for paying public officials it had to be proved that the stories they subsequently published had somehow harmed the public interest. The opposite was generally the case. Many of the payments to sources had helped expose failings in state agencies, to the public’s benefit. The police could find no example of the public interest being harmed.

A senior Sun executive who was charged before later being cleared suffered from mental ill-health and his marriage almost collapsed. “‘We all felt like we had entered a parallel universe,” he told me.

“What we were doing had been company policy since we joined News International. We were taught how to do it by people who already worked there. And everyone knew about it. Scotland Yard seemed to know about it for years and didn’t think it was a problem. Everything we exposed was in the public interest. And then suddenly everyone pretends this was actually really bad and your life gets turned upside down.”

John Kay, the veteran chief reporter of The Sun, was broken by NI’s decision to hand the Met evidence of payments to one of his sources, Bettina Jordan-Barber, a Ministry of Defence official. A gregarious and generous man, Kay became a virtual recluse and died in a care home aged seventy-seven.

When his death was announced in May 2021, Kelvin MacKenzie, Kay’s former editor at The Sun and long-time confidant of Rupert Murdoch, spoke out about the horrors of Operation Elveden. “John was among twenty-two staff that Murdoch threw under the bus to save his own skin when threatened with a corporate charge which would have forced him out of his own company”, MacKenzie told the Press Gazette.

“In my years of running The Sun Murdoch never asked where John’s fantastic tales came from; he was only interested that we had them so we could sell more papers, make more money and stuff the opposition. All 22 were cleared, but what broke John was one of his best contacts over the years ended up being jailed. The trial took its toll on John. He spent his last years in a nursing home in Hertford. As guilt money Murdoch paid £25,000 towards the care costs.”

Lucy Panton, the former crime editor of the News of the World, was put through two trials and nineteen months on police bail. She said she had been “completely hung out to dry” by a company which she had loyally served for a decade. “When my daughter Lily was born she was very ill and on a life support machine. I was made to work by her bedside after her second and third operations. The loyalty I had shown to the company meant nothing.” But Panton, who is married to a police officer, was even more furious at the betrayal of her sources:

“Six police officers got questioned and arrested for giving me what investigators alleged was unauthorised information. These were matters of public interest and in some cases given out at briefings. They were never paid for stories and none of them were charged. It’s been horrible knowing that people who were just doing their jobs, as I thought I was doing my job, have suffered as a result of News International handing my sources over. Your sources are the one thing you are supposed to protect as a journalist and I was unable to do that.”

She said she regards the public officials she spoke to who were prosecuted as “whistleblowers who were turned over by News International”.

At the height of Operation Elveden, when Murdoch agreed to meet his disgruntled journalists in person and was secretly recorded, he acknowledged that the culture of paying police officers for stories “existed at every newspaper in Fleet Street”.

In one clip later broadcast by Channel 4 News, Murdoch said: ‘We’re talking about payments for news tips from cops. That’s been going on a hundred years, absolutely. You didn’t instigate it.” At another point on the tape, The Sun’s agony aunt, Deidre Sanders, read extracts of a letter on behalf of a relative of a Sun journalist. The emotional letter describes how journalists and their families felt ‘betrayed’, ‘abandoned’ and ‘isolated’.

During the meeting, Murdoch also appeared to regret the extent of his company’s co-operation with the police. One of the journalists questioned the volume of documents handed over. “Because – it was a mistake, I think,” he said. “But, in that atmosphere, at that time, we said: ‘Look, we are an open book, we will show you everything.’ And the lawyers just got rich going through millions of emails.”

Over at Tower 42, the police officers surveying those documents were feeling the effects of Murdoch’s regret.

As the flow of material to Scotland Yard dried up, DCS Gordon Briggs complained to News Corp: “The role of the police is simply to search for the truth and the higher up the organisation our investigation goes, the more you appear to withdraw co-operation.”

Broken Yard: The Fall of the Metropolitan Police is published by Biteback, price £20.

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