The Phone Hacking Scandal Gets Even Uglier

Stream of new revelations battering company

The story so far: Clive Goodman, a journalist for Rupert Murdoch’s English tabloid, the News of the World, was sent to prison in 2006, along with a private detective, Glenn Mulcaire, for hacking into the voicemail messages of Prince William and Prince Henry. News International, the U.K. newspaper-owning subsidiary of Murdoch’s News Corporation, has consistently claimed that the phone hacking was confined to a single rogue reporter, but evidence uncovered by the Guardian and New York Times has suggested otherwise.

You can tell that the phone-hacking scandal has turned ugly now that old friends in the London media-business establishment are falling out. Lord Sugar, the entrepreneur who is the Donald Trump figure in Britain’s version of The Apprentice, recently spoke out about phone hacking in a debate in the House of Lords. Not content with journalists guilty of phone hacking being sent to prison, Lord Sugar argued that it was "ludicrous" to say that an editor would not have known that it was going on—as former News of the World editor Andy Coulson has claimed—and that “the editor also should be given a custodial sentence, and indeed the proprietor and the board of directors." This fell into the category of “not very helpful” comments as far as News International was concerned. So when Lord Sugar, the son of an East End tailor and known for his blunt and withering comments on The Apprentice, turned up to the News International summer party at the Orangery in Kensington, he was refused entry by Simon Greenberg, News International’s head of corporate communications. This was especially embarrassing for Sugar since the party, hosted by Rupert Murdoch himself, was attended by Prime Minister David Cameron and most of the Cabinet and Shadow Cabinet. When Sugar insisted that he had been invited, James Murdoch emerged from the party to re-iterate that he was not welcome.

It is a far cry from the summer of 2007, when a wholly owned subsidiary of satellite broadcaster BSkyB, under James Murdoch’s auspices, paid £125 million to buy Amstrad, the PC-manufacturing business created by Lord Sugar, which was by then deriving all its income from making set-top boxes for Sky, the satellite service owned by Murdoch’s BSkyB. And it is an even farther cry from the time in 1992 when Sky’s then chief executive, Sam Chisholm, was tipped off about the Premier League bidding process by Sugar when he was chairman of Tottenham Hotspur Football Club. A once cozy relationship has become prickly indeed.

On Monday, Mr Justice Vos, the High Court judge in charge of the managing the phone-hacking cases, ordered the Metropolitan Police to hand over more documents from the cache of 11,000 pages and 111 recordings confiscated from private investigator Glenn Mulcaire. Access to these documents was being demanded by lawyers acting for various phone-hacking victims, but News International's barrister, Michael Silverleaf QC, had objected on the grounds that disclosure of the documents would not significantly alter the sum claimants would receive in damages but would greatly add to his client's legal costs. But Mr Justice Vos said he also had to consider "whether this was an appropriate way to deal with a case that was so much in the private eye." He told Silverleaf, "What you are saying is that you want to put a lid on disclosure and deal with it by way of admissions." With the further safeguard, they will be redacted to exclude the names of third parties who are not suing and have not yet been named in the scandal.

At the same time as the court order was being made, a fifth individual, former Press Association royal reporter Laura Elston, was arrested by detectives, though no further details of her possible role were released.

Since our last report there have been a number of developments which, like Lord Sugar’s eye-catching comments in the House of Lords, have been less than helpful to the News International cause.

The first of these, admittedly, came from the source with the largest ax to grind, the Guardian newspaper, which has made the most out of running with the phone-hacking scandal. A Guardian leader urged the Conservative-Lib Dem Coalition government to announce a public inquiry into phone hacking. “If Cameron is disinclined to stir this particular hornets’ nest (was his own phone ever hacked, incidentally?), then Clegg [the Lib Dem Deputy Prime Minister] should force his hand. He will find British public opinion very much on his side.”

Next came the announcement that Manchester United footballer Ryan Giggs has instructed his solicitors to issue proceedings against News International after detectives from the Metropolitan’s Operation Weeting squad showed him evidence seized from Glenn Mulcaire’s home in 2006 that suggests that he was targeted by Mulcaire in his phone-hacking spree. Mulcaire’s notes covered Giggs’ movements in 2005 and 2006, when the footballer was still having an affair with his sister-in-law, Natasha Giggs.

Proof that the phone-hacking scandal is becoming ever more complex and convoluted is the revelation that Rebekah Brooks, Rupert Murdoch’s so-called “golden girl” and the chief executive of News International, was herself a victim. The Metropolitan Police has shown her evidence that her phone was hacked 20 times by Mulcaire. In an attempt to divert attention from News International itself, this revelation was made by Sky News’ city editor, Mark Kleinman, who ventured the suggestion that Mulcaire’s hacking of Brooks’ phone might also have been conducted on behalf of one of the News of the World’s tabloid rivals, meaning either the Daily Mirror, Sunday Mirror, or one of the Mail titles.

The one encouraging development from News International’s point of view has been the decision by Andy Gray, ex-footballer, TalkSport radio presenter, and until recently a Sky presenter—he was sacked back in January for making sexist comments about a female referee and a female fellow presenter—to accept £20,000 in settlement of his own phone-hacking claim. This was to form part of the super-trial of five reserve claims scheduled for next January by Mr Justice Vos. In an effort to pick off yet more litigants with settlements before their claims reach court, News International has appointed Sir Charles Gray, a former High Court judge, to administer its compensation scheme, the sweetener being a 10 percent premium on top of the maximum likely award the courts are likely to make, as well as full legal costs.

Last week saw the fourth arrest since Operation Weeting began. A 39-year-old woman, Terenia Taras, was arrested on suspicion of phone hacking in West Yorkshire. Taras is said to have worked as a casual reporter for the News of the World in 2000 and 2001 and thereafter as a freelance, registering some 36 bylined articles over six years. She has also written for the Daily Mirror and Sunday Mirror. News International’s reaction to her arrest, issued in a press statement, was predictably disingenuous: “This morning’s events did not relate to a current employee or a former full-time member of staff of the News of the World. We have been co-operating fully with the police inquiry since our voluntary disclosure of evidence reopened the police investigation. Since then we have been determined to deal with these issues both on the criminal and civil side.” (There was nothing “voluntary” about News International’s disclosure, which was only made once court action was underway.)

What the News International statement didn’t mention, but which was gleefully reported in other papers, was that one salient reason why the police might be interested in Taras, apart from any wrongdoing she may or may not have committed herself, was that she was formerly in a relationship with former News of the World executive Greg Miskiw, once an assistant news editor of the paper and in charge of its Manchester office. It was Miskiw who signed a £105,000 contract with Glenn Mulcaire for “research and information” and an additional contract for £7,000 relating to a specific inquiry about Gordon Taylor, the chief executive of the Footballer’s Association, who successfully sued the News of the World for phone hacking a couple of years ago. The Metropolitan Police is said to be eager to interview Miskiw, but he is currently thought to be residing in the United States.