Police payment emails growing worry for Murdoch execs

WASHINGTON, (Reuters) – Executives at Rupert  Murdoch’s UK-based News International are concerned that emails  discussing questionable payments made to police by the News of  the World may prove more problematic than those that discuss  phone hacking, sources familiar with investigations into the  shuttered tabloid’s reporting practices said.

There are growing concerns inside the company that evidence  of questionable payments to police — or other British public  officials — could fuel investigations by U.S. authorities into  possible breaches of the Foreign Corrupt Practices Act (FCPA),  an American law that prohibits corrupt payments to foreign  government officials. News International is owned by New  York-based News Corp .

“We’re more frightened by the (U.S. Justice Department) than  we are of Scotland Yard,” a source close to News Corp who was  briefed about the content of the emails told Reuters. “All  Scotland Yard can go after is News International but the Justice  Department can go after all of News Corporation.”

Thousands of News of the World emails were assembled in 2007  when News International executives and lawyers at an outside  firm were preparing responses to a litigation threat lodged by  Clive Goodman, a former reporter for the News of the World, who  was jailed for hacking into voicemail messages of aides to  Britain’s Royal family. The emails sat ignored for years in the archives of London  law firm Harbottle & Lewis. News International retrieved them  earlier this year and showed them to Ken MacDonald, a former  Director of Public Prosecutions for England and Wales and a  member of the House of Lords. MacDonald recently told Parliament  that after he read the messages in May, it had taken him “about  three minutes, maybe five minutes” to determine that they  contained evidence of possible criminality.

The company subsequently turned over the e-mails to London’s  Metropolitan police, who shortly after receiving them set up a  team to investigate payments to police officers. The company  later authorized Harbottle & Lewis to cooperate with  parliamentary and police investigators.
While much has been made of emails related to the phone  hacking scandal, which since July has sparked a flurry of  resignations within the company and Scotland Yard, some at News  International are more worried by emails referring to payments  to police.
The source close to News Corp said lawyers hired by News  International were soon expected to question journalists at more  than one of Murdoch’s British publications about possible  payments to both UK police officers and other British public  officials.
Last month News Corp hired Mark Mendelsohn, who served as  the deputy chief of the Fraud Section in the Criminal Division  of the United States Department of Justice (DOJ). Mendelsohn is  internationally acknowledged and respected as the architect and  key enforcement official of the DOJ’s Foreign Corrupt Practices  Act enforcement program.
Reuters is a competitor of Dow Jones Newswires, the  financial news agency that News International’s New York-based  parent company News Corp acquired along with the Wall Street  Journal in 2007.
The source close to News Corp said the email traffic  indicates Goodman and the then-editor of the News of the World,  Andy Coulson, agreed that an unnamed police contact should  receive a “four-figure sum” for leaking a confidential file  known as the “green book” containing information about the  movements, locations and phone numbers of members of the royal  family.
The source said the dossier held by Harbottle & Lewis also  included financial records showing the precise amount mentioned  in the e-mail traffic was paid out in cash. The payment was made  on or about the same day of the alleged e-mail exchange, to a  recipient who used a pseudonym.
The source, and a second source briefed on the matter, said  the evidence available to News International now indicates that  neither the paper nor its outside lawyers sought to review the  archived evidence relating to police corruption, or to further  examine its content, between the time the material was sent to  storage in 2008 and its retrieval earlier this year.
A spokeswoman for News International said she could not  discuss the emails or how the company handled them due to a  continuing investigation by British police.
Harbottle & Lewis says it has been asked by police to not  make public the emails’ contents “to preserve the integrity of  their criminal investigation.”
On Thursday, parliamentary officials were expected to ask  News International to authorize Burton Copeland, a second  outside law firm retained by the publisher, to help the company  look into questionable practices, the  source close to News Corp  told Reuters.

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