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Cameron to face parliament on hacking scandal ties (updated)

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July 20, 2011, 6:37 a.m. | World — by Associated Press

James Murdoch leaves parliament after giving evidence to the Culture, Media and Sport Select Committee on the News of the World phone-hacking scandal in London, Tuesday, July 19, 2011.
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LONDON (AP) — Prime Minister David Cameron faces lawmakers Wednesday at an emergency parliament session on Britain's spreading hacking and bribery investigation, a day after media mogul Rupert Murdoch accepted no responsibility for wrongdoing in the scandal that is threatening some of Britain's most powerful people. Cameron cut short his Africa trip and returned home late Tuesday to appear before the parliamentary question session he called.

Cameron's former communications chief Andy Coulson — a former editor at the now-defunct tabloid News of the World — is among several people who have been arrested in the scandal.

Lawmakers want to know why Cameron insisted on hiring Coulson despite warnings, how much the prime minister knew about the phone hacking investigation, whether Coulson had any role in persuading the police to initially drop the hacking investigation, and how many times Cameron met with Murdoch or top associates at News International.

Britain's Conservative Party said Tuesday it just found out that another recently arrested phone-hacking suspect, former News of the World executive editor Neil Wallis, may have advised Coulson before the 2010 national election that was won by Cameron's party. It said he was not paid for the advice, however.

In a three-hour grilling Tuesday, 80-year-old Murdoch insisted he was at fault only for trusting the wrong people at the News of the World, which he described as a tiny portion of his vast media empire.

Murdoch said he had known nothing of allegations that staff at his News of the World tabloid hacked into cell phones and bribed police to get information on celebrities, politicians and crime victims, and that he never would have approved such "horrible invasions" of privacy.

But, despite lawmakers' suggestions that his organization encouraged such behavior, Murdoch was unflappable — even after a protester rushed to throw a foam pie at him during the hearing.

A News Corp. attorney partially blocked the attack and Murdoch's 42-year-old wife, Wendi Deng, slapped the prankster. After the protester was arrested, the billionaire simply shed his splattered suit jacket and continued answering questions.

On Wednesday, police said they had charged Jonathan May-Bowles, 26, with behavior causing harassment, alarm or distress in a public place.

The scandal has captivated audiences from America to Murdoch's native Australia, and there's more to come; only a fraction of some 3,870 people whose names and telephone numbers were found in News of the World files have been contacted by police so far.

It remains unknown how many of those names were targeted for hacking.

Murdoch has already shut down the News of the World, given up on buying full control of British Sky Broadcasting, Britain's biggest commercial television company, and accepted the resignations of two top executives.

He said he had no plans to resign but expressed contrition on behalf of News Corp.'s British newspaper division, News International.

"This is the most humble day of my career," said Murdoch, a man once so politically powerful in Britain that former Prime Minister Tony Blair flew halfway around the world to secure his support as he launched the Labour Party's bid for power in 1995.

In a separate hearing, London police chiefs said Wednesday that News International had set out to "deliberately thwart" the police's original phone hacking investigation in 2005 and 2006. Lawmakers countered that the police had shown poor judgment in not pursuing the investigation further.

The scandal began as a blip in 2005, when the News of the World published a story about Prince William suffering a knee injury. Royal officials became suspicious about the closely held data and alerted police.

An inquiry led to one of the paper's reporters and a private investigator being jailed for intercepting communications.

The Guardian newspaper then found out that Murdoch's papers had paid out more than $1.6 million (1 million pounds) to settle lawsuits involving allegations of eavesdropping on phone messages.

The scandal became a crisis for News International this month with the revelation that the News of the World had hacked into the phone of a 13-year-old murder victim, Milly Dowler, in hopes of getting tabloid scoops.

Murdoch said he was "shocked, appalled and ashamed" at the hacking of Dowler's phone but he denied that criminality had been endemic at the tabloid.

He also said he had seen no evidence that victims of the Sept. 11, 2001, terror attack were hacked — an allegation the FBI is looking into.

Murdoch said he had not been told about the big sums — 700,000 pounds ($1.1 million) in one case, 1 million pounds in another — paid to settle lawsuits by phone hacking victims.

Murdoch noted that News of the World represented less than 1 percent of his global media empire, which includes the Fox TV network, 20th Century Fox film studio, The Wall Street Journal, the New York Post and three major British newspapers.

He said he spoke to the News of the World's editor only around once a month.

James Murdoch, 38, apologized for the scandal, telling British lawmakers that "these actions do not live up to the standards our company aspires to."

The younger Murdoch insisted the company acted as swiftly and transparently as possible.

Rupert Murdoch acknowledged, however, that he did not investigate after Brooks, a former editor of the News of the World, told parliament years ago that the paper had paid police officers for information.

Brooks, testifying after the Murdochs, described allegations of voicemail intercepts of crime victims as "pretty horrific and abhorrent."

She said she had been told by employees of the tabloid that allegations of phone hacking were untrue, and she only realized the gravity of the situation when she saw documents in a civil damages case by actress Sienna Miller last year.

Brooks also said she had never knowingly sanctioned payments to police for information.

After the hearing, Rupert Murdoch sent News International staff an email saying that the company has taken responsibility, and that the allegations "directly contravene our codes of conduct and do not reflect the actions and beliefs of our many employees."

He said the company will cooperate fully with authorities.

"Those who have betrayed our trust must be held accountable under the law," he said.

The value of News Corp. rose around $2 billion while the Murdochs were being grilled, trading 5.3 percent higher at $15.74, regaining some of the $8 billion it has lost this month.

Credit ratings agency Standard & Poor's said it has put News Corp. on a credit ratings watch because of "the increased business and reputation risks associated with broadening legal inquiries."
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