News / USA

News Corp Faces Potential Fallout in US

News Corporation CEO Rupert Murdoch holds a copy of The Sun and The Times as he is driven away from his flat in central London July 11, 2011.
News Corporation CEO Rupert Murdoch holds a copy of The Sun and The Times as he is driven away from his flat in central London July 11, 2011.

Multimedia

Peter Fedynsky

U.S.-based News Corp. is at the center of a phone-hacking scandal in Britain that is having serious business and legal implications for the media giant. There is increased scrutiny in the United States of News Corp. and its chairman, Rupert Murdoch.

Allegations that the U.S.-based News Corp. violated British law may have legal consequences for the company in the United States.  Several U.S. senators and Republican Congressman Peter King have called for an investigation to determine if the company violated any American laws.  Attorney General Eric Holder, the Securities and Exchange Commission and the Federal Bureau of Investigation have responded with preliminary inquiries.

Jay Fahy, a former federal prosecutor and criminal defense attorney, explains relevant laws.

“On the criminal side, from what we know, it’s the Foreign Corrupt Practices Act and perhaps some privacy violations, or mail fraud or wire fraud as to breaking into cell phone records," said Fahy. "There may also be bribery if cell phone companies were somehow given money.”

News Corp. is alleged to have bribed British police to get information for stories run in its tabloid News of the World.  The Foreign Corrupt Practices Act extends a U.S. prohibition against bribery to include U.S. companies operating abroad.  Former News of the World editor Andy Coulson, who once served as a spokesman for British Prime Minister David Cameron, has been arrested in the case, which involves not only the possible tapping of cell phones in Britain, but of 9/11 victims in the United States.  

News Corp. has also suffered multi-billion-dollar business losses.  The media giant was forced to scuttle plans to buy a controlling share of the lucrative British Sky Broadcasting, Britain’s biggest satellite broadcaster.  

Felix Gillette, a reporter for Bloomberg Businessweek, says the scandal has also pummeled the company’s stock.

“They’ve lost on paper more than $5 billion," said Gilette. "I think shareholders are nervous about what this means for the future of the whole company."

News Corp. chairman Rupert Murdoch, an Australian by birth, acquired U.S. citizenship to be eligible for media ownership in the United States.  His assets include a Hollywood studio and the Fox television network, which is particularly influential among American conservatives.  

Murdoch has been criticized for consolidating media, depriving the public of diverse viewpoints needed to make informed decisions in a democratic society.  Among the critics is Dean Starkman, a fellow at the Columbia Journalism Review.

“This moment, with the scandal in the U.K., it has the potential to radically change the media landscape both here in the U.S. and around the world," said Starkman.

Starkman says the phone-hacking scandal could give smaller media organizations an opportunity to challenge the power that News Corp. has acquired.  That power includes 27 broadcasting licenses in the United States issued by the Federal Communications Commission.  Jay Fahy says the FCC could refuse to renew those licenses.

“If the FCC took a hard line on this, and it is proven that Murdoch knew of it, or his son knew of it, or very high level people in the company knew of it, this could cause them to lose those licenses, and if those licenses are lost, that’s the end of his empire," he said.

Fox News has made little mention of the scandal and did not respond to VOA’s request for an interview.  Rupert Murdoch told The Wall Street Journal, which he owns, that he is creating an independent committee to investigate allegations of possibly illegal reporting tactics that have shaken his company.

You May Like

Could Nemtsov Threaten Putin in Death as in Life?

Dynamic and debonair opposition leader had supported liberal economic reforms, criticized Russian president's aggression in Ukraine More

Oil Smuggling Highlights Challenges in Shutting Down IS Finances

Pentagon spokesman says Islamic State 'certainly continues to get revenue from the oil industry black market' but that airstrikes have made a dent More

India Focuses on Infrastructure, Investment to Propel Economy

Government expects economy to grow at 8 to 8.5 percent in next fiscal year More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Supreme Court Hears Hijab Discrimination Casei
X
Katherine Gypson
February 25, 2015 11:30 PM
The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video US Supreme Court Hears Hijab Discrimination Case

The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video Falling Gas Prices Hurt Nascent Illinois Hydraulic Fracturing Industry

Falling oil prices are helping consumers purchase cheaper petroleum at the pump. But that’s made hydraulic fracturing or “fracking” less economically viable for the companies in the United States invested in the process. VOA’s Kane Farabaugh reports on one Midwestern town that was hoping to change its fortunes by cashing in on the next big U.S. oil boom.
Video

Video Fighting in Sudan's South Kordofan Fuels Mass Displacement

Heavy fighting in Sudan's South Kordofan state is causing hundreds of thousands to flee into uncertain conditions. Local aid organizations estimate as many as 400,000 civilians have been internally displaced since the conflict began more than three years ago, while another 250,000 have fled across the border to refugee camps in South Sudan. VOA's Adam Bailes reports.
Video

Video Lao Dam Project Runs Into Opposition

A Lao dam project on a section of the Mekong River is drawing opposition from local fishermen, international environmental groups and neighboring countries. VOA's Say Mony visited the region to investigate the concerns. Colin Lovett narrates.
Video

Video A Filmmaker Discovers Her Biracial Identity in "Little White Lie

Lacey Schwartz grew up in an upper middle-class Jewish family, in a town in upstate New York where almost everyone she knew was white. She assumed that she was, as well. Her recent documentary, Little White Lie, tells the story of how she uncovered the secret of her true racial background. VOA’s Carolyn Weaver has more on the film.
Video

Video Deep Under Antarctic Ice Sheet, Life!

With the end of summer in the Southern hemisphere, the Antarctic research season is over. Scientists from Northern Illinois University are back in their laboratory after a 3-month expedition on the Ross Ice Shelf, the world’s largest floating ice sheet. As VOA’s Rosanne Skirble reports, they hope to find clues to explain the dynamics of the rapidly melting ice and its impact on sea level rise.
Video

Video US-Cuba Normalization Talks Resume Friday

Negotiations aimed at normalizing diplomatic relations between the U.S. and Cuba resume Friday. On the table: lifting a half-century trade embargo and easing banking and travel restrictions. There's opposition in Congress, but some analysts say there may be sufficient political and economic incentives in both nations for a potential breakthrough this year. VOA's Mil Arcega reports.
Video

Video Pakistan's Deadline For SIM Registration Has Cellphone Users Scrambling

Pakistani cell phone users have until midnight Thursday to register their SIM cards, or their service will be cut off. While some privacy experts worry about government intrusion, many Pakistanis are just worried about keeping their phone lines open. VOA Deewa reporter Arshad Muhmand has more from Peshawar.
Video

Video Myanmar Warns Factory Workers to End Strikes

Outside Myanmar's main city Yangon, thousands of workers walked off their jobs earlier this month demanding a doubling of their wages, pay raises after a year and input from labor unions on industrial regulations. Since Friday, the standoff has grown more tense as police moved in to disrupt the sit-ins, resulting in clashes that injured people from both sides. VOA correspondent Steve Herman visited industrial zones which have become a focus of Myanmar's fledgling workers rights movement.
Video

Video Oscar Winners Do More Than Thank the Academy

The Academy Awards presentation is Hollywood’s night to reward the best movies from the previous year. It’s typically a lot of glitter, a lot of thank you’s, a lot of speeches. But many of this year’s speeches carried messages beyond the thank you's. VOA’s Carolyn Presutti takes a look.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More