James Murdoch was sensationally accused of being a Mafia boss by Tom Watson as he faced a fierce grilling over News of the World phone hacking on Thursday.
In an explosive exchange, Watson accused Murdoch of subscribing to a Mafia-style “code of silence” over hacking.
“I think you must be the first mafia boss in history who didn't know he was running a criminal enterprise,” he said to Murdoch.
Moments earlier Watson revealed he had secretly been speaking to former News of the World reporter Neville Thurlbeck about the whole issue of phone hacking.
After a hostile and potentially devastating exchange, Watson then read out the transcipt from a private conversation Thurlbeck had with Tom Crone, the former News of the World legal manager.
"'Is there any way we can get round this?" Thurlbeck said to Crone. Crone told him: "Nev I'm sorry I'm going to have to show him [Murdoch] this because it's the only reason we have to settle."
MORE PHONE HACKING STORIES:
Mark Lewis, phone hacking lawyer, blogs for Huffington Post UK
How Harry Potter caused a stir on Twitter after "For Neville"
The whole question of phone hacking had previously centred around the infamous “For Neville” email.
Murdoch again insisted again that he was never shown a transcript of the email which suggested that phone hacking at the News of the World went beyond a single rogue reporter.
Watson then tried to liken the Murdoch family and News International to the Mafia, but was told he was being “offensive”.
After Watson read out his email, Huffington Post UK political editor Chris Wimpress, who is in the committee hearing, live blogged: “After a short pause, Murdoch reiterates his line. I had no discussions about widespread hacking. Committee is chuckling.”
After the Mafia allegation, there were "Some murmurs of surprise in the committee room. JM says the accusation is ‘inappropriate’."
Documents released by News International's former lawyers Farrer & Co last week suggested there was an earlier discussion between Mr Myler and Mr Murdoch, around May 27 2008, at which the "For Neville" email might have been raised.
A briefing note prepared at the time by Mr Crone said that its discovery left the company in a "very perilous" position.
But Murdoch said he could not recall discussing the Gordon Taylor case with Mr Myler before June 10 2008.
The News of the World's former royal editor Clive Goodman was jailed for phone hacking, along with private investigator Glenn Mulcaire, in January 2007.
Documents released by the committee this week showed that Goodman was paid three months' salary, totalling £22,504, following his guilty plea to hacking charges, and went on to receive further payments totalling more than £240,000 later in 2007.
Murdoch said he did not discuss the phone-hacking convictions or the pay-outs to Goodman with his predecessor as News International executive chairman, Les Hinton.
"I had no discussion with him about it. He didn't raise it with me or brief me on it," he told the committee.
Other than that, not a word from him.
And it's not clear whether we are any nearer the truth. Quite simply it's James Murdoch's word against those of former NOTW editor Colin Myler and News International legal counsel, Tom Crone. James Murdoch has repeatedly stuck to his line, that he didn't know hacking was widespread.
The key points :
- Murdoch says when executives told him that staff involved with phone hacking would probably win unfair dismissal cases, Murdoch was only told to settle and how much it would cost. He was never told why they had a case - because they had provided stories based on hacked phones - and Murdoch didn't ask
- He claims running a massive company like News Corp means it is impossible for someone in his position to know all the details.
- He tells MPs that Myler and Crone have been "economical" in their evidence.
- He also tries to shift the blame to the police , saying they had possession of crucial evidence and did nothing.
- He says he regrets News International being so robust in earlier defences against hacking allegations
- He refuses to rule out closing The Sun if it turns out hacking has taken place at the newspaper.
Murdoch handled the session calmly, only becoming irritable when called a "Mafia Boss" by Tom Watson. In general MPs have listened with a high level of scepticism to the evidence, but there was no knockout blow.
Murdoch once again won't be drawn on the recent arrest of a Sun journalist.
He also won't say if he will close The Sun if it turns out hacking happened there. But he won't rule it out.
Arguing that because the Sun got away with wrong accusations about Liverpool fans in 1989 a culture of invulnerability had developed.
Murdoch says the Sun had apologised, and apologises again.
He also says it's not in the public interest to tell lies.
...he also asks Murdoch if he knew that Watson had been told about a potential email hacking involving the MP.
Murdoch has just been read a list of four names by Tom Watson, who the MP says are private investigators.
Murdoch says he has never heard of them.
This following on from some prior comments made by Tom Crone at September's session.
Louise Mensch is asking whether News International will ever come completely clean about envy thing that went on.
Murdocch says he wants to be "as transparent as possible."
Labour MP Chris Bryant, who is not on the committee but is in the room, seems to have given up hope of this session finding anything meaningful out. His tweets suggest as much, as does his body language.
He says the recent arrest of a journalist at The Sun was "of great concern", but says he has no knowledge of any other papers doing phone hacking, although an investigation is underway.
Murdoch responds to this point from Paul Farrelly by saying that Tom Crone and Colin Myler's evidence hpto the committee in September had been incoherent:
"They never clearly told you hat they shows me those emails... It was a very confusing and muddled, that session."
Paul Farrelly MP is now asking about the editorial in the last ever News of the World. It, says Farrelly, repeated the News Internatnal line that nobody had known.
From later evidence from former NOTW staff, we now know that's not true.
JM: That's for them to say.
"it was specifically said to me he was doing this on behalf of News of the World, with respect to that."
Murdoch is basically answering every incredulous question with the same answer. It was a settled matter, I had all the relevant information, I had no reason to believe there was widespread hacking.
He cannot recall whether in 2009 he was the chairman or executive chairman of news international
"I might have been named executive chairman" he says later. Quite extraordinary.
This is during the period between Les Hinton left News Intenational to go to Dow Jones and Rebekah Brooks being promoted.
Feet crossed over each other, he sometimes likes to push the two water cups in front of him a few centimetres away from himself. Throughout the hearing he's tended to keep his hands together whe he's listening. When he starts to speak, he tends to shuffle the buff folder in front of him a little bit when he opens his mouth.
In general he looks pretty relaxed, now. He wasn't earlier.
Tory Mp Philip Davies says he can't understand why a senior executive at the top of a company the size of News Corp would not want oversight of such large payouts.
"Any chief operating officer.... would say, "My God, I need to have a look at that."
JM (quite irritably) says he relies on executives directly responsible "to do the things they needed to do."
Not for phone hacking. Different type of dark magic.
Murdoch insists that the "relevant information" about the settlement for Taylor had been given to them. This, we are to believe, is quite limited. Murdoch says the only relevant information was that News International would lose, and how much by.
accuses Murdoch of beijing the first mafia boss not to be aware they were running a criminal enterprise.
Some murmurs of surprise in the committee room.
JM says the accusation is "inappropriate". A short time earlier he described Watson's accusation that News International had been run in a Mafioso style as "offensive".
Several smirks of disbelief among the public as Murdoch stands by his story.
Tom Watson MP reads out a transcription of a conversation, related to him from Neville Thurlbeck. It suggests that Thurlbeck had told Tom Crone he would have to go to Murdoch with widespread.
After a short pause, Murdoch reiterates his line. I had no discussions about widespread hacking. Committee is chuckling.
The first big revelation of the session...
|@ paulwaugh : Gotta say Murdoch account sounds plausible, given way newspaper execs protect proprietors from nasty smells.|
|@ KeirSimmonsITV : Charlotte Harris 'James Murdoch is using careful language - 'incomplete, economical' - to say that he thinks he was misled'.|
|@ gabrielsherman : James now saying Myler and Crone misled the committee. The story is now definitively Murdoch's word vs. Myler and Crone. Who's right?|
Certain individuals were aware. I was not aware. Even in 2009 the company relied for too long on repeated assertions as to the quality and rigour of internal investigations, and also relied on the assertions made by the police, who had all the evidence.
Murdoch: I believe some individuals gave evidence to Parliament without full possession of the facts, or they have been "economical".
Murdoch says his evidence has been consistent. He maintains that Tom Crone and Colin Myler's testimony was misleading.
Watson - You expect us to believe that you authorised a substantial payout without seeing three documents which were key to the settlements given to staff?
JM - that's what happened.
Murdoch is sticking to his story. "the only substantive meeting I recall happened on the 10th of June 2008."
JM also rejects claims by Tom Crone that Murdoch knew about widespread hacking. "No, I don't accept that at all, Mr Watson."
Murdoch is getting slightly irritated.
Tom Watson is asking about Tom Crone's "fatal to our case" memorandum. The Labour MPis taking JM's long answers and paraphrasing them for him.
JM is not happy about this.
Tom Watson was just checking.