Phone-Hacking Inquiry: Evidence 'as Clear as Mud'

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Former legal execs fail to convince MPs that James Murdoch knew about phone-hacking.

LONDON -- Rupert Murdoch, James Murdoch and Rebekah Brooks were “briefed incorrectly” about the extent of internal phone-hacking at the News of The World when they gave evidence in July,a senior former News International legal exec claimed Tuesday.

But in a separate admission that could yet have major consequences, former News of The World legal manager Tom Crone admitted that News International had paid for surveillance into the private lives of lawyers acting for claimants making civil cases against News International and that he had seen some of the documents.

At a four-hour evidence session Tuesday, MPs heard from former News International director of legal affairs Jon Chapman, former director of human resources Daniel Cloke, former legal manager Tom Crone and former News of The World editor Colin Myler about the extent executives acted on information that criminal activities had become widespread within the newspaper group.

However in evidence described as “contradictory” and “as clear as mud” by Committee member Louise Mensch, MPs came away unconvinced by their testimony that James Murdoch had been properly informed that phone-hacking had been widespread at the News of The World.

Questions now remain for former Wall Street Journal boss Les Hinton and former News of The World editor Andy Coulson, and James Murdoch may still be recalled to give evidence.

Jon Chapman told the House of Commons Parliamentary Committee Tuesday that the evidence the Murdochs and Brooks gave to Parliament two months ago was based on second-hand information that was incorrect.

“What I think was that their evidence [last month] related to the 2007  [internal News International] evidence review. None of them had any direct knowledge of that [investigation]. James Murdoch and Rupert Murdoch were out of the country and Rebecca Brooks was an editor at the time. They would have knowledge [of the internal investigation] only to the extent that Mr Hinton [former News International chief executive Les Hinton] told them about it,” said Chapman.

“In order for them to be able to comment they would be reliant on briefings from other people and I suspect those briefings were incorrect,” he said.

In a subsequent evidence session, former News of The World legal manager Tom Crone insisted that James Murdoch had been informed that phone-hacking was widespread, but was forced to admit he had no recollection of the exact briefing he had given and that the meeting with the News Corp. deputy COO had been very short.

“In order to settle the case [paying-off phone-hacking] victim Gordon Taylor] we had to explain the case to Mr Murdoch and get this authority to settle it, so certainly it would have been discussed. I cannot remember the detail of the conversation. The conversation lasted for quite a short period of time, less than 15 minutes. It was discussed, but exactly what was said I cannot recall.”

Crone said he had not given James Murdoch a copy of the critical “for Neville” email showing that there was more evidence of phone-hacking because he was unable to make copies of the police document and limited by police procedure as to whom he could show it to.

When he appeared before the committee in July, James Murdoch denied any knowledge the email and said he had only agreed to pay a seven-figure sum to settle a case against phone-hacking victim Gordon Taylor on advice from Crone and former New of The World editor Colin Myler.

“Well, it seemed to be clear to other people. I can’t speak to what view Mr Murdoch came away with from that meeting,” said Myler, when questioned. “What I came away with was the decision to settle.”

In his evidence to the committee on the separate accusations leveled at News International by former royal reporter Clive Goodman, News International’s legal boss Jon Chapman claimed that a separate $400,000 pay off was a “pragmatic business decision” and not a cover-up, and that the amount Goodman was paid had been decided by Les Hinton, even though it was far in excess of what a tribunal would have ordered.

Goodman had appealed the decision to fire him, claiming that phone-hacking had been approved by his bosses and that he had been told that he could keep his job if he did not implicate News International in his court case.

“We didn’t take the decision to settle, that decision was taken by Mr Hinton. The position is that it was a stark choice – settle at a reasonable figure or end up at tribunal where Clive Goodman would have been able to make allegations in a public forum,” Chapman said.

Insisting that the internal review carried out within News International’s legal department had discovered little support for Goodman’s claim that hacking had been widespread, Chapman said the decision to pay off the former reporter had been a business decision.

“This is a pragmatic commercial decisions. Many companies pay out on employment claims that have little or no basis because they don’t want things to be raked up.”

In later evidence, Tom Crone flatly denied that Clive Goodman had been promised that he could keep his job if he didn’t implicate News International in his court case – for which he served four months in jail.

But he admitted that he had told Goodman that the then News of The World editor Andy Coulson was lobbying to have him re-instated after he served his sentence.

“Andy Coulson had a conversation with me when he said that at the end of it all, if Clive Goodman was guilty and sentenced, he was hoping he could persuade the company that he could come back in a different role,” Crone said.

“When I spoke to Clive Goodman he was very pessimistic and depressed. I relayed to him what Andy Coulson was hoping.”

In the final minutes of the session, Crone made the astonishing revelation that a “freelance journalist” had been paid to provide personal dossiers on lawyers representing clients fighting civil claims against the newspaper group.

“I saw one document,” he said in an admission that will likely open a whole new can of worms about the ethics of the Murdoch-run organization.

Asked to give further details by Labor MP Tom Watson, Crone said: “I don’t think we should do this, given the criminal investigation.”