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Smart v. Stupid

FBI investigates News Corp—Is Fox News next?

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Last week, we outlined the admitted (and denied) criminal allegations at News Corp and issued a first-in-the-nation call for an FBI investigation. Since that modest beginning, calls for a U.S. investigation of Rupert Murdoch’s media empire have exploded. And the public outrage shows no signs of stopping.

U.S. Senators Jay Rockefeller, Barbara Boxer, Robert Menendez and Frank Lautenberg (all Democrats) have called for various investigations. "My bet is we'll find some criminal stuff," Senator Rockefeller told CNN. "This is going to be a huge issue."

In a letter to US Attorney General Eric Holder, Senator Frank Lautenberg called on the Department of Justice to investigate New Corp for possible violations of the Foreign Corrupt Practices Act (FCPA.) Lautenberg was joined by Senator Boxer, who also asked for the FCPA investigation.

Under FCPA, Murdoch and company—particularly son James Murdoch and executive Rebekah Brooks—could be found guilty of US crimes for bribing police officers in England. Penalties are stiff—up to $30 million in fines to the corporation and 20 year in prison for the perpetrators. There is every reason to believe that a concrete case of police bribery will be made in England. No one yet knows how high it will go, either in the police or at News Corp.

Senator Bob Menendez is concerned with US-based crimes against 9/11 families. In a letter to Eric Holder the senator writes, “The U.S. government must ensure that victims in the United States have not been subjected to illegal and unconscionable actions...” Is he asking about criminal activity by British News Corp? Or is he asking about phone hacking by U.S. News Corp? So far it’s just News International. That paper is another British paper owned by Murdoch, not The News of the World, the now defunct paper at the center of the scandal.

Even a Republican Representative, perennial blowhard and Muslim hunter Peter King, has joined the fray. In a letter to FBI Director Robert Mueller, king called Murdoch’s brand of “fair and balanced” more akin to a criminal enterprise. “According the recent reports, journalists working for the News of the World solicited a New York police officer to gain access to the content of private phone records of 9/11 victims,” wrote King. “It is revolting to imagine that members of the media would seek to compromise the integrity of a public official for financial gain in the pursuit of yellow journalism,” He also said the allegations, could merit “felony charges.”

Strange Peter’s aggressive call for an investigation is notable. He’s been a huge beneficiary of friendly coverage from Fox News. In fact, many would argue that Fox fueled his rise to prominent spokesperson for the anti-Muslim and anti-mosque causes. Any U.S. investigation of News Corp is sure to include Fox News.

A similar reaction is now happening in Great Britain where politicians who were formerly favored by New Corp—or who formerly feared it—are expressing public disgust. In droves. Among them is Prime Minister David Cameron. His government stands some chance of falling by his associations with seedy News Corp characters. He called the affair, “an episode that is frankly disgraceful.” Yet he’d rather focus on police corruption than on bribery. That’s because he’s closely linked to News Corp. All four News Corp newspapers endorsed Cameron in his election. And Cameron is the neighbor and horse riding buddy of News Corp’s Rebekah Brooks, who is at the dead center of the scandal.

At Murdoch headquarters they continue to do damage control. After first closing the 168 year old The News of the World, the company has now abandoned its bid to acquire a controlling interest in British Sky Broadcasting (BSkyB.) The takeover collapsed after intense public outcry and a unanimous disapproval vote by Parliament. There is talk that News Corp may have to abandon all of its UK newspapers to escape the scandal—an event that seems to be forgone given that most advertisers have pulled the plug.

Some are even saying that News Corp will have to leave the UK altogether. The business environment may no longer allow them to do business. But that scandal will seem like a firecracker if the nuclear bomb—a FOX News hacking scandal—is uncovered.

Just now (7/14, 2:45 PM) CBS News is reporting that the FBI has opened a criminal investigation into News Corp. FBI officials in the New York office are declining to comment but not denying the anonymous FBI source. So it begins…

Rosebud.

Jimmy Zuma splits his time between Washington, D.C. and Tucson. He writes the online opinion journal, Smart v. Stupid. He spent 5 years in Tucson in the early ‘80s, when life was a little slower, swamp coolers were a little more plentiful, Tucson’s legendary music scene was in full bloom, and the prevailing work ethic was “don’t - unless you have to.”

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“My bet is we’ll find some criminal stuff.”

— U.S. Senator Jay Rockefeller (D-WV)

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