Rupert Murdoch faces anger over crisis at Britain's Sun (correction)

By Anna Tomforde Feb 16, 2012, 15:15 GMT

London - Being an international media mogul may be a lucrative - but not necessarily a pleasant - task.

Rupert Murdoch, who last year ate humble pie over the phone hacking scandal at one of his British newspapers, now faces the wrath of his journalists. Once praised for their investigative skills, these same journalists are now being questioned by police over alleged corrupt payments to the police and public officials.

The arrest of a total of 10 senior editors and reporters on the Sun newspaper, Britain's best-selling daily tabloid acquired by Murdoch in 1969, has provoked an unprecedented level of anger in the newsroom, insiders report.

The journalists, including the paper's most talented writers, veteran editors and political commentators who have been with the Sun for more than 40 years, have all been released on bail.

But their anger has been fuelled by Murdoch's cooperation with police investigators over the issue of 'corruption,' following allegations of an attempted cover-up of the hacking scandal.

As a result of the phone hacking affair, for which Murdoch offered a public apology and paid compensation to numerous victims, his News Corporation set up a Management and Standards Committee (MSC) to assist the police investigations.

The committee has supplied no less than 300 million emails to police investigators studying relations between Sun journalists and the authorities, including the police, government, armed forces and the judiciary over the past decade.

The arrest - and release - of five top journalists last weekend prompted a sharp response from Trevor Kavanagh, a long-time Murdoch loyalist and associate editor of the Sun.

Kavanagh claimed that his colleagues had been treated 'like members of an organized crime gang' in a 'witch-hunt' which was 'driven by politicians' and which could threaten the foundations of a free press in Britain.

But his claim that journalists were being 'criminalized for simply doing their jobs' by taking contacts out to a lunch was immediately refuted by sources close to the MSC.

'This is not about paying for stories or people having lunch with their contacts. Paying money to a police officer or other public officials is against the law. There is no public defence in bribery,' a source close to the MSC said.

According to the Independent newspaper, the 'cash culture' at the Sun was widespread. Journalists would be receive 'wads of cash' from cashiers to entertain or pay contacts, in return for signed chits.

'It was very tempting to reward your contact so that they didn't go off to a rival paper,' the paper quoted a former executive of News International, Murdoch's British company.

Scotland Yard also defended its handling of the investigations, saying that the 'seriousness and complexity' of the allegations presented the police with an 'enormous task' which required the use of nearly 170 officers and staff.

After the hacking scandal, which forced Murdoch to close down the Sun's sister paper, the best-selling News of the World (NoW) Sunday tabloid, and made him withdraw from a bid for a full takeover of the BSkyB TV news channel, the turmoil at the Sun has renewed speculation over whether the 80-year-old magnate will keep his British titles.

In an initial reaction to the arrests, Murdoch pledged that he would keep the Sun, but also stressed that he had no choice but to cooperate with the police investigations - a message he is expected to repeat when he addresses staff on Friday.

In addition to the 'reputational damage' inflicted on the Murdoch empire by the hacking scandal, figures released this month showed that the affair cost Murdoch's US-based News Corporation 65 million pounds in compensation payments and legal costs in the second half of last year alone.

However, media analysts in Britain point to key differences between the hacking scandal, which caused public revulsion following the revelation that the phone messages of a teenage murder victim had been intercepted, and the current crisis at the Sun.

It was the combination of a 'revolt by readers' and the withdrawal of big advertisers which prompted last year's closure of the NoW, said media commentator Roy Greenslade.

Unless 'something even nastier' emerged from the investigations, Murdoch was unlikely to close the Sun down.

'I cannot believe that Rupert Murdoch will take the nuclear option by closing his beloved paper, nor can I imagine him offering it for sale. The Sun will soldier on, at least as long Murdoch lives,' he said.