Press probe says more papers may have phone-hacked (Reuters)

LONDON (Reuters) – Other tabloids besides Rupert Murdoch's News of the World may have hacked phones, a London court heard on Monday as it began an investigation into newspaper practices that could lead to tougher regulation of the entire UK press.

The Leveson inquiry, expected to take about a year, was set up by Prime Minister David Cameron after it was revealed in July that the News of the World ordered hacking of the voicemail of missing schoolgirl Milly Dowler, who was later found murdered.

"The inquiry is beginning to receive evidence to indicate that phone hacking was not limited to that organization," said Robert Jay, counsel to the inquiry.

He said Glenn Mulcaire, who was jailed for phone-hacking in 2007 along with the News of the World's royal reporter Clive Goodman, had written the words "Daily Mirror" and "The Sun" in his notebooks, referring to other tabloids.

Jay said the names of 27 other News of the World reporters besides that of Goodman, long scapegoated by News Corp's British newspaper arm as a lone "rogue" reporter, had been found in Mulcaire's notebooks.

As police work through a list of 5,800 potential hacking victims, including actor Hugh Grant, Harry Potter author J.K. Rowling and ex-soccer star Paul Gascoigne, the scale of the scandal at and beyond the News of the World is still unclear.

News Corp executive James Murdoch, son of Chief Executive Rupert Murdoch and executive chairman of the group's British newspaper arm, is meantime fighting for his credibility as heir to the media empire.

James Murdoch has testified twice to a British parliamentary committee that he knew nothing of the scale of phone-hacking at the once best-selling tabloid, which he closed down in July in an attempt to limit the damage.

Neville Thurlbeck, a former chief correspondent at the tabloid whose name appears in a key piece of evidence, told Reuters on Monday he believed Murdoch had indeed been kept in the dark.

CHILLING

Murdoch's claims to have cleaned up the newspaper's culture, however, have been undermined by the News of the World's recent admission that it ordered surveillance of figures including lawyers representing hacking victims as early as this year.

Last week, Murdoch apologized to members of the parliamentary committee for the fact that the News of the World had monitored their activities.

Louise Mensch, a member of the committee, asked on Monday: "What possible public interest could there be in that? It is chilling, it's terrifying. It sort of says: 'Don't mess with us because we'll come to get you.'

"If it is true, I want to know who did the authorization, when, and on what basis, and I certainly want to see any reports that were compiled about myself and my colleagues," the Conservative member of parliament told Sky News.

Labour MP Tom Watson, the most aggressive member of the committee, pulled out of an industry event on Monday to discuss what he described as fresh evidence that News Corp spied on his colleagues.

"Under the circumstances, I have to spend the day seeking advice from the Speaker (of parliament) and discussing the matter with fellow members of the DCMS Select Committee as to our legal and constitutional position," he said.

Jay said none of the instances of phone-hacking that had so far come to light, which include eavesdropping on crime victims and relatives of war dead, came close to being justified on public-interest grounds.

"What can be justified in the public interest and how can it be justified lies at the very epicenter of this inquiry," Jay said in his opening statement.

He cited the Guardian's dogged reporting on the phone-hacking scandal, the Telegraph's exposure of members of parliament fiddling expense claims, and the Sunday Times's 1960s campaign for compensation for thalidomide victims as instances in which underhand reporting methods had been justified.

But he said the press too often went on "fishing expeditions" without any idea of what they would find, fuelling a view of the press as ruthless, unscrupulous and willing to do anything to boost circulation.

Britain's press is currently self-regulated by the Press Complaints Commission, a voluntary body with little funding and no legal powers.

Its chairperson at the time of the hacking fallout, Peta Buscombe, announced after the Milly Dowler revelations that she would step down.

The PCC is not expected to survive in its current form, and the conclusions of the Leveson Inquiry, being held at London's Royal Courts of Justice, will be important in deciding what should replace it.

"The press provides an essential check on all aspects of public life. That is why any failure in the media affects all of us," Judge Brian Leveson, who is in charge of the inquiry, said in his opening statement.

"At the heart of this inquiry therefore may be one simple question: Who guards the guardians?"

(Additional reporting by Kate Holton; Editing by Andrew Heavens)

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Murdoch apology in UK papers, Cameron defends links (AFP)

LONDON (AFP) – Britain's government defended its links with Rupert Murdoch on Saturday as the embattled media mogul published apologies in national newspapers over the phone hacking scandal saying: "We Are Sorry."

A day after Murdoch suffered the loss of two of his closest aides, the crisis returned to haunt British Prime Minister David Cameron as it emerged he had 26 meetings in 15 months with key figures from the Australian-born magnate's empire.

British Foreign Secretary William Hague came to Cameron's defence, saying he was "not embarrassed" by the extent of the contacts with those close to Murdoch, 80, who has wielded his influence over British politics for decades.

Those invited to Cameron's country retreat, Chequers, included Rebekah Brooks, who quit as chief executive of News International, Murdoch's British newspaper wing, on Friday and was a previous editor of the News of the World, now closed.

Another was Murdoch's son James, the chairman of News International.

"Personally, I'm not embarrassed by it in any way. But there is something wrong here in this country and it must be put right. It has been acknowledged by the PM and I think that's the right attitude to take," Hague told the BBC.

Cameron also invited Andy Coulson, his former media chief and another one-time editor of the News of the World tabloid, to Chequers in March, two months after Coulson quit Downing Street.

Coulson was arrested last week in connection with the scandal over alleged hacking and payments to police, one of nine people held since police reopened their investigations in January. He denies the charges.

Hague said: "In inviting Andy Coulson back the prime minister has invited someone back to thank him for his work, he's worked for him for several years, that is a normal, human thing to do, I think it shows a positive side to his character."

On Saturday, Murdoch abandoned his previously defiant stance and ran full-page adverts in seven national British dailies, apologising for the hacking scandal at the News of the World, which he closed down last week.

"We are sorry," the headline of the ads read. They were signed "Sincerely, Rupert Murdoch."

It said: "We are sorry for the serious wrongdoing that occurred. We are deeply sorry for the hurt suffered by the individuals affected. We regret not acting faster to sort things out."

In a further show of contrition, Murdoch on Friday met the parents of murdered teenager Milly Dowler, whose phone was allegedly hacked by the News of the World in 2002, when Brooks was editor of the paper.

Murdoch's determination to keep his empire afloat was shown, however, when he accepted the resignation of Brooks on Friday and then, hours later that of Les Hinton, head of Dow Jones, the publisher of The Wall Street Journal.

Hinton had worked with Murdoch for 50 years.

British-born Hinton said that although he knew nothing of the phone hacking when he was chairman of News International from 1995 to 2007, he must take responsibility for the "unimaginable" pain it caused.

Brooks denies any wrongdoing, but as editor of News of the World when Dowler's phone was allegedly hacked, she became a lightning rod for outrage.

The 43-year-old, who started out as a secretary at the tabloid and is viewed almost like a daughter by Murdoch, told News International staff she felt a "deep sense of responsibility for the people we have hurt".

The departures of Brooks and Hinton capped a disastrous week for Murdoch in which he was also forced to scrap a buy-out of British pay-TV giant BSkyB.

They have also now exposed Murdoch's heir-apparent James, 38, who is the chairman of News International and also runs the Asian and European operations of parent company News Corporation.

The British government has announced a full public inquiry into the scandal.

Rupert Murdoch, James Murdoch and Brooks have all been summoned to testify before British lawmakers on Tuesday.

But the scandal continued to spiral with the news that British actor Jude Law is suing The Sun over phone hacking in 2005 and 2006, when Brooks was editor, in the first such claim against the Murdoch-owned daily.

News International dismissed the claims as a "deeply cynical".

In the United States, the FBI has began probing allegations that Murdoch's US employees may have hacked the phones of victims of the September 11 attacks, dealing a potentially huge blow to his US-based News Corp.

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Murdoch defends papers as Cameron pledges hacking probe (Reuters)

LONDON (Reuters) – Rupert Murdoch promised full cooperation on Wednesday to resolve a scandal shaking his media empire after British Prime Minister David Cameron promised an inquiry into what he called "disgusting" phone hacking by a newspaper.

Responding in parliament to allegations that the News of the World eavesdropped on voicemail for victims of notorious crimes, including child murders and suicide bombings, Cameron said he was "revolted" and would order inquiries, probably into both the specific case and more widely into Britain's cut-throat media.

The opposition, keen to highlight Cameron's own ties to Murdoch and to two former editors at the eye of the storm, noted that any inquiry would not start, let alone finish, for months if not years. Critics accused the Conservative government of trying to bury the embarrassment of the long-running saga.

Murdoch, whose News International group faces boycotts from advertisers and readers as well as questions over a takeover bid for broadcaster BSkyB, made a rare public statement to say he too found the hacking, and reports of buying tips from police, "deplorable and unacceptable" and would ensure transparency.

But the 80-year-old Australian-born American media magnate made clear he was standing by Rebekah Brooks, the 43-year-old head of his British newspaper operation. She was editor in 2002 when, police say, a News of the World investigator listened to -- and deleted -- voicemails left for the cellphone of missing 13-year-old Milly Dowler, who was later found murdered.

Cameron said: "We do need to have an inquiry, possibly inquiries, into what has happened." The prime minister faces questions over his own judgment in appointing Brooks'successor as editor, Andy Coulson, as his spokesman. Coulson quit Cameron's office in January, but denies knowing of any hacking.

Cameron, who regularly hosts Brooks at his home, said: "We are talking about murder victims, potentially terrorist victims, having their phones hacked into. It is absolutely disgusting."

In a further twist to the affair, a spokesman for Finance Minister George Osborne confirmed media reports that police had told the senior cabinet minister that his name and home number were in notes kept by two people jailed for phone hacking.

"FULLY COOPERATE"

Murdoch said in his statement: "Recent allegations of phone hacking and making payments to police with respect to the News of the World are deplorable and unacceptable.

"I have made clear that our company must fully and proactively cooperate with the police in all investigations and that is exactly what News International has been doing and will continue to do under Rebekah Brooks' leadership."

The leader of the opposition Labour party, Ed Miliband, said Cameron had made a "catastrophic error of judgment" in hiring Coulson as his communication director and said Brooks, a high-flying Murdoch confidante, should resign her current post. She says she knew of no illegal hacking while editing the paper.

When its royal correspondent and an investigator were jailed in 2007 for hacking into the cellphones of royal aides to break a story about an injury to Prince William's knee, the newspaper insisted it was a case of one rogue reporter.

After campaigning by celebrities and politicians who suspected they too had been spied on, police launched a new inquiry in January and, following the arrests of several journalists, the affair has taken on dramatic new proportions.

Shares in Murdoch's News Corp, which also controls Fox television, the Wall Street Journal, London's Times and the New York Post among other titles, were down over 5 percent in New York, while shares in BSkyB fell more than 2 percent.

Major advertisers abandoned the News of the World.

Speaking for one carmaker Lance Bradley said: "Mitsubishi Motors in the UK considers this type of activity-- especially in such a distressing case-- to be unbelievable, unspeakable and despicable ... This is where we draw the line."

Internet campaigns and the actor Hugh Grant urged readers to boycott the paper which, if successful, may prove more damaging than political condemnation to Britain's best-selling Sunday paper, read by some 7.5 million people on sales of 2.6 million.

Sales of News Corp's daily sister paper the Sun never recovered in Liverpool after it offended the city's football fans in the wake of the 1989 Hillsborough stadium disaster.

"We need an inquiry that uncovers all the practices and the culture, not just of the News of the World but all tabloid journalism in this country," said Grant, a fixture of the gossip columns, who says he was a victim of phone hacking.

BROADCASTER BID

Though analysts believe the chances of the BSkyB purchase being derailed are slim, the watchdog which oversees Britain's broadcasting industry issued a statement pointing out that it had a duty to assess whether holders of a broadcasting license are 'fit and proper'. Murdoch is trying to buy the 61 percent of the BSkyB pay-TV group that it does not already own.

"There has been a shift in the last three days, there is now a consensus that this needs full and proper scrutiny," media consultant Steve Hewlett told Reuters.

Police have been criticized for being slow to investigate the phone-hacking claims but reject suggestions this was because of alleged payments to officers. The head of the Metropolitan Police Paul Stephenson said allegations of "inappropriate payments" to some officers were under investigation.

British politicians have said in the past they feared criticizing any of the Murdoch papers because they feared their own private lives might be exposed.

Among further allegations, families of Londoners killed by Islamist suicide bombers in 2005 said police had told them their voicemail messages may have been intercepted.

Graham Foulkes, whose son David was one of 52 people who died in the 7/7 bombings, told BBC radio he was contacted by police after they found his private contact details on a list as part of the investigation into hacking claims.

"We were using the phone frantically trying to get information about David and where he may have been and ... talking very intimately about very personal issues, and the thought that these guys may have been listening to that is just horrendous," Foulkes said. Relatives are preparing to mark the sixth anniversary of the attacks on Thursday.

News International said it would be contacting the Defense Ministry about reports the phone numbers of British soldiers killed in Iraq and Afghanistan were found in the files of a private investigator jailed for hacking phones.

"If these allegations are true we are absolutely appalled and horrified," it said in a statement.

On Tuesday the company said new information had been provided to police. The BBC said the material related to e-mails appearing to show payments to police officers for information and were authorized by Coulson when he was editor.

Commentators suggested information about the payments had been released to deflect attention from Brooks, who unlike Coulson is still a key part of Murdoch's business. The Guardian, a left-leaning daily which has taken a lead in investigating the scandal, said News International would also be saying that Brooks was on holiday at the time of key alleged incidents.

"If Rebekah falls then who is next? Well it's James Murdoch," said media consultant Hewlett, suggesting that keeping her in her position served to protect her superior, Murdoch's son James, from criticism. "This feels to me like a firewall."

Media commentator Stephen Barnett said Brooks's position seemed at risk but that Murdoch would likely support her: "If she has 100 percent backing of Rupert Murdoch then clearly she is untouchable and more importantly it shows that Murdoch himself thinks the company is untouchable," he said.

The Guardian said police investigating the phone-hacking claims were now turning their attention to all high-profile cases involving the murder or abduction of children since 2001.

The key allegation is that journalists, or investigators hired by them, took advantage of often limited password security on mobile phone voice mailboxes to listen to messages left for celebrities or people involved in major stories.

What has particularly outraged many was the suggestion, made by police to the family of Milly Dowler, that a News of the World investigator not only hacked into her mailbox during the six months of 2002 that she was missing but also deleted messages to make room for more -- misleading police and giving her family false hope she was still alive and well.

The child's killer was tried only this year and convicted just last month, refreshing painful memories of the case.

The parents of two 10-year-olds taken and murdered by a school caretaker in the town of Soham in 2002 -- one of Britain's most notorious crimes in recent years -- have been contacted by police probing hacking at the News of the World.

(Additional reporting by Georgina Prodhan, Michael Holden, Keith Weir, Olesya Dmitracova, Stefano Ambrogi and Alastair Macdonald; Editing by Jon Boyle)

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