Rupert Murdoch’s News Corporation will not face any charges in the US in relation to phone hacking and payments to public officials by News of the World journalists in the UK, the company said.
“News Corporation was notified by the United States Department of Justice that it has completed its investigation of voicemail interception and payments to public officials in London and is declining to prosecute the company or 21st Century Fox,” the company said in a regulatory filing.
The company had faced the threat of an investigation under the US Foreign Corrupt Practices Act (FCPA), which bans US companies from attempting to bribe foreign officials.
Gerson Zweifach, general counsel for both News Corp and 21st Century Fox, Murdoch’s film and TV business, said: “We are grateful that this matter has been concluded and acknowledge the fairness and professionalism of the Department of Justice throughout this investigation.”
It is understood there has been no background settlement with the Department of Justice in order to avoid a full-blown investigation, contrary to speculation in New York over a year ago that the company was looking at a possible payment of over $850m.
The Department of Justice (DoJ) said: “Based upon the information known to the Justice Department at this time, it has closed its investigation into News Corp regarding possible violations of the Foreign Corrupt Practices Act concerning bribes allegedly paid for news leads. If additional information or evidence should be made available in the future, the Department reserves the right to reopen the inquiry.”
The Securities and Exchange Commission (SEC), the US regulator, declined to comment.
Experts had said it was unlikely that News Corp would face a US investigation in direct relation to phone hacking, unless it could be proved that News Corp employees hacked people’s phones while they were in the US. The actor Jude Law has claimed that his phone, and that of his assistant, were hacked shortly after arriving at New York’s JFK airport. Their mobile telephones were operating on US networks, meaning that regardless of where the alleged hacker was based, US law could apply.
However, legal experts said it was possible that US authorities could investigate News Corp over News of the World journalists’ alleged payments to police and other officials as this would breach the strict FCPA rules design to stamp out bad behaviour by US companies abroad.
Norman Siegel, the US attorney for a group of relatives of September 11 victims who suspected they may have been hacked, said they had been blindsided by Monday’s announcement.
“The attorney general promised my clients that before the department published any statement, they would meet with us, and explain what their inquiry had found and what their conclusions were,” Siegel said. “So this is very disappointing that they did not fulfil their promise. I will be calling the attorney general to request that meeting.”
Murdoch closed the News of the World in 2011 after it was revealed that reporters from the paper had hacked into the voicemails of Milly Dowler, a missing schoolgirl who had been murdered. Both Murdoch and his son James were called to testify before parliament.
The decision not to prosecute News Corp comes seven months after the marathon hacking trial which saw Rebekah Brooks, the company’s former chief executive of its British publishing operation News International, cleared of both hacking and charges that she approved payments to public officials.
Andy Coulson, Brooks’ former deputy editor at the News of the World, along with four newsdesk executives, Greg Miskiw, Neville Thurlbeck, James Weatherup and Ian Edmondson, were either found guilty or pleaded guilty to voicemail interception.
A sixth former News of the World employee, reporter Dan Evans, also pleaded guilty to hacking including the interception of voicemails left by actor Sienna Miller on the phone of James Bond star Daniel Craig.
Since September, 11 journalists employed or formerly employed by News of the World and the Sun have been tried in relation to allegations of payments to public officials and to handling stolen mobile phones handed into the paper.
Four former or current Sun journalists have been found not guilty on charges relating to payments. Five Sun journalists face retrial in relation to similar charges after juries could not reach a verdict.
One Sun journalist has been found guilty in relation to a mobile phone while one former Sun journalist has been found not guilty to a similar charge.
A further four Sun journalists are currently on trial at the Old Bailey in London charged with conspiring to cause misconduct in public office in relation to alleged unlawful payments to public officials for stories.
At the height of the investigation into alleged malpractice at the News of the World, influential Democratic senator Jay Rockefeller, said the hacking scandal “raises questions about whether the company has broken US law”.
Last year, the DOJ and SEChanded out several large fines in relation to FCPA investigations including $772m to French industrial giant Alstom, $135m to Avon and $108m to Hewlett-Packard.
Murdoch split his newspaper operations from his Fox entertainment empire last year.