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THE DARK ARTS
It started when the News of the World hacked into the voice mails of the British
royal household, in 2005, touching off a scandal that Rupert Murdoch s News Corp. a
nd, apparently, the British authorities tried to contain. After a score of lawsuit
s and new arrests, the cover-up is falling apart.
BY SARAH ELLISON
JUNE 2011
EARS ON THE PRIZE News of the World reporters allegedly intercepted the voice-ma
il messages of actors Jude Law and Sienna Miller. Photographs Daniel Hambury/EPA
/Corbis (Law and Miller), by David Hartley/Rex USA (Harry and William), from Joh
n Frost Newspapers (newspapers), by Kevin Winter/Getty Images (Macpherson).
The Pugin Room in the Houses of Parliament is a small chamber where tea and othe
r refreshments are served in a comfortable setting overlooking the Thames. Named
for the architect who designed the elaborate Gothic Revival interiors of the pa
rliamentary complex, it is wood-paneled and ornate, with small, low tables that
can t quite hide a worn red carpet. The quiet conversations are occasionally inter
rupted by the clanging of a bell that notifies members of an upcoming vote.
In these surroundings I recently sat with John Prescott, the former deputy prime
minister to Tony Blair and currently (as Baron Prescott of Kingston-upon-Hull)
a member of the House of Lords. In 2006 one of Britain s tabloid newspapers, the D
aily Mirror, revealed that Prescott had been carrying on with a secretary in his
office. The *Daily Mirror *s competitors, eager to catch up, were scrambling for
additional details. One of them, Rupert Murdoch s News of the World, allegedly hac
ked the voice-mail messages left on the telephone of Prescott s chief of staff, Jo
an Hammell. Prescott had been aware at the time of something amiss messages known
to have been left had somehow been deleted but he put it down to a technical glitc
h. Only later, as the dimensions of Britain s widening phone-hacking scandal began
to emerge, was he able to piece a larger story together and then locate his own
part of the story inside it.

Interactive: Breaking down the News of the World hacking scandal.

After years of virtually ignoring evidence of phone hacking that it held in its
possession, on April 5 Scotland Yard arrested the former assistant news editor o
f the News of the World, Ian Edmondson, and the paper s chief reporter, Neville Th
urlbeck, in connection with a new investigation. Three days later, after deftly
stonewalling parliamentary inquiries and paying more than $2 million in settleme
nts to keep the matter under wraps, Murdoch s News Corp. offered an unreserved apol
ogy and an admission of liability to Joan Hammell and seven other victims of phon
e hacking. The seven are British actress Sienna Miller and her stepmother, Kelly
Hoppen; a British member of Parliament, Tessa Jowell, and her husband, David Mi
lls; a former Sky Sports commentator, Andy Gray; the soccer agent Sky Andrew; an
d Nicola Phillips, a London-based publicist. All of these seven have filed lawsu
its. The following day the company sent letters to nine more plaintiffs. Seven a
dditional lawsuits have yet to be officially filed but appear imminent. News Cor
p. says it plans to offer a settlement to those with justifiable claims of phone h
acking. Every day there were more damaging disclosures, death by a thousand cuts,

one News Corp. executive close to the phone-hacking case recently told me, expla
ining the company s decision to apologize.
On April 14, the police arrested a third reporter from the News of the World, Ja
mes Weatherup. The next day, many of the players on the victims side of the story
gathered in London s Royal Courts of Justice to learn how the presiding judge pla
nned to deal with their lawsuits. The judge identified four test cases that coul
d proceed later this year the suits brought by Miller, Hoppen, Gray, and Andrew.
The phone-hacking scandal is the story of a breathtaking moral logjam, a caution
ary tale about what can happen when the boundaries between powerful entities blu
r when the police and the politicians and the media are jockeying for self-preserv
ation, even as they are aligned in a common interest not to run afoul of one ano
ther. It is also what happens when one group, in this case News Corp., Murdoch s m
edia conglomerate, holds the goods on all the others.
Acting Alone?
Phone hacking is illegal in Britain, but that is a technicality. By all accounts
, it was a practice that was indulged in by many reporters at many newspapers. It
started as a playground trick, Paul McMullan, a former editor at the News of the
World, told me. It was so easy that everybody did it, and there was absolutely n
o reason not to. No reason, that is, until there was a very good reason when the pr
actice suddenly went too far. In 2005, senior aides to the royal family noticed
that voice-mail messages they had never listened to were showing up as saved mes
sages in their in-boxes. At the same time, the News of the World was running sto
ries about the princes that could have been known only to a small circle of inti
mates. One article quoted verbatim from a voice-mail message left by Prince Will
iam for his brother, in which William imitated Harry s girlfriend, Chelsy Davy. Ti
pped off by the Palace, Scotland Yard launched an investigation.
In 2006 a reporter at the News of the World, Clive Goodman, and a private invest
igator who worked for the newspaper, Glenn Mulcaire, were found guilty of illega
lly listening in on the voice-mail messages of the royal household. The two men
received short prison terms. The editor of the newspaper, Andy Coulson, resigned
from his position, though he stated that he had no personal knowledge of phone
hacking being done by anyone in his newsroom. Coulson described the phone hackin
g of the princes as the work of a rogue reporter. He was backed up by other execut
ives at News Corp., which owns Fox Entertainment, The Wall Street Journal, the N
ew York Post, and several of the biggest newspapers in Britain, including the Ne
ws of the World.
But the rogue reporter story wasn t true. Phone hacking was common practice at the N
ews of the World, and News Corp. s stance finally crumbled amid a raft of lawsuits
, a serious police investigation, and a steady stream of departures from the pap
er. Besides the victims already mentioned, the alleged targets of the News of th
e World apparently included the actor Hugh Grant, the comedian Steve Coogan, the
model Elle Macpherson, the soccer stars John Terry and David Beckham, and even
(the British press has suggested) Prime Minister Gordon Brown. Nobody knows exac
tly how many people were targets altogether a conservative estimate would be 2,000
, but the true figure could be double or triple that number. The scandal has tou
ched some of the most prized executives at News Corp., such as Rebekah Brooks, t
he chief executive for its U.K. newspapers, and Les Hinton, the chief executive
of Dow Jones & Co., who used to have Brooks s job. Rupert Murdoch, 80, now must de
al with allegations that some of his editors encouraged criminal activity and th
en repeatedly lied about it sometimes under oath to cover it up. The possible ramifi
cations extend to British politicians of all stripes, who have for decades done
what they could to curry favor with Murdoch, and to Scotland Yard, which has its
own cozy relationships with the tabloids and is widely suspected of having trie
d to keep a lid on the revelations.

In the Pugin Room, Prescott is happily reliving the story of his unsatisfactory
interactions with Scotland Yard. Prescott is something of a court jester and str
eet brawler. When a protesting farmer appeared at one of his campaign rallies in
2001 and threw an egg at him, Prescott threw a punch back. A former ship s stewar
d and trade-union activist, he revels in his northern accent and his outspoken a
nd brusque persona.
Prescott s barrel chest puffs out as he sips his tea. He leans back, his legs spla
yed. For nearly two years, ever since The Guardian published a story revealing t
hat his name had appeared on a list of public figures in handwritten notes belon
ging to Glenn Mulcaire, Prescott and his lawyers had been asking the police if t
hey had any evidence of his voice mails being intercepted. He had received multi
ple letters in response, and gave me photocopies of them all.
When I look through the pages, I see that early letters informed him that the po
lice had not uncovered any evidence to suggest his phone had been tampered with.
he police wrote that they had referred the matter to the mobile-phone companies,
which would take appropriate action, if warranted.

Prescott persisted, and continued to be told that there was no evidence to indic
ate that Goodman and Mulcaire had attempted to intercept any of his voice messag
es. And yet, in some of those same letters, the police told Prescott that in Mul
caire s files they had found two invoices from News International Supply Company,
a subsidiary of News Corp., to Mulcaire s private-investigation company, for more
than $400 each, with references such as STORY: OTHER PRESCOTT ASSIST-TXT. Scotland
Yard added, We do not know what this means or what it is referring to.
When I look up at Prescott, he nods back. So I said, Why don t you bloody open them
up and see, and then we ll know whether it is tapped. That s what investigation is a
bout! They still refused to do an investigation.
Coulson Had to Know
Sean Hoare has a smooth and relaxed voice over the phone. He speaks slowly, almo
st with a drawl, and it seems as if he might chuckle at any moment. He sounds yo
ung. It s hard to square his voice with the man who greets me at the train station
in the working-class town of Watford, outside London. Hoare s face is covered wit
h broken blood vessels, and he walks stiffly, with a limp. He apologizes multipl
e times for the inadequacy of the restaurant we walk to for a coffee. Hoare is u
nemployed, though he takes occasional jobs around town. His days as a reporter h
ave clearly taken their toll. I was paid to drink and do drugs with rock stars, he
tells me, by way of explanation.
Hoare has agreed to talk to me about phone hacking at the News of the World, whe
re he worked for more than 10 years. He is cagey on specifics, worried as he needs
to be about the legal implications. What seems to offend Hoare more than anything
is the fact that the practice of phone hacking, and digging into people s private
lives in general, was so widely encouraged by the paper s top brass and yet, when G
oodman was found guilty of hacking into phones, he was abandoned by his former c
olleagues.
Hoare had worked closely with Andy Coulson for a long time. He described an enor
mously competitive tabloid culture: Your brief, above all else, was to deliver. Th
e advantage of phone hacking, Hoare said, was that it provided verification of r
umors. Once a journalist had confirmed a story through phone hacking, he could t
ake the tidbit to the celebrity s publicist and begin trading. You d say, I ve got this
detail. I don t want to fuck over your client, but what do you have for me? Then t
he publicist would offer an alternative story, and Hoare would back off, all the
while knowing he had the initial piece of information if he ever needed it. It s n

ot really about journalism,

with words.

he said.

It s negotiation. It s basically like Wall Street

The News of the World is no stranger to criticism of its methods. For instance,
it employs the Fake Sheikh, who conducts sting operations on politicians and busin
essmen. In 2001 he recorded Prince Edward s wife, Sophie, Countess of Wessex, maki
ng disparaging comments about certain members of the British government and appe
aring to use her royal status in order to gain clients for her public-relations
firm. To prevent publication of her comments, she agreed to an interview with th
e News of the World about her views on pregnancy and the possibility of undergoi
ng I.V.F. treatments. The paper published the story under the headline MY EDWARD S
NOT GAY, nodding to continued gossip about the prince s sexuality. Last year, the
Fake Sheikh taped Sarah Ferguson, the Duchess of York, offering access to her f
ormer husband, Prince Andrew, for more than $700,000.
The News of the World can be a cutthroat environment. Hoare recounted the story
of a former colleague, Matt Driscoll, who was dismissed by the newspaper and the
n sued it, citing the bullying behavior of Coulson and other editors. In Novembe
r 2009, the court found in favor of Driscoll, and the News of the World was requ
ired to pay him about $1.3 million.
Hoare left the paper in 2005, in part because of his drug and alcohol problems.
He is an easy witness to discredit, and people I speak to at News Corp. don t hesi
tate to try to do so. But it s not hard to see why Hoare was such a good journalis
t in his day. He speaks softly enough that I have to lean halfway over the table
to hear him. He often sounds as if he walked off the set of a Guy Ritchie movie
. He asks as many questions as I do. About Coulson, he says, Either Andy was a dr
eadful editor or a liar. You cannot run a newspaper and not know where things co
me from. Phone hacking at the News of the World, Hoare goes on, was encouraged as
long as you didn t get caught. Andy was aware that the practice was going on.
Paul McMullan told me that phone hacking was so common that I reckon a quarter of
the British population was doing it. Coulson had to know. McMullan explained tha
t phone hacking was in fact a step down from what he used to do when mobile phon
es became popular and ran on analog technology. You could go and legally buy a sc
anner and sit outside Hugh Grant s house and listen to his calls as they happened,
McMullan said. I remember transcribing Prince Charles s conversations with Camilla
just by scanning mobile phones. And Diana talking to her lovers. This goes back
a long time. When the mobile carriers switched to digital technology, scanning be
came much more expensive, so reporters settled for hacking into people s mobile-ph
one messages.
Hugh Grant recently wrote an article, The Bugger, Bugged, for the April 11 issue o
f the New Statesman, guest-edited by his former girlfriend Jemima Khan, in which
he interviewed McMullan. Grant wrote that just before Christmas, when his car h
ad broken down on a country road, a white van pulled over, not to help him, but
to snap pictures. The man at the wheel of the van was McMullan, who now runs a p
ub in the seaside town of Dover. McMullan still keeps a camera in the glove comp
artment, so that he can practice his old craft on a freelance basis when the opp
ortunity arises, as it did with Grant. In the end McMullan offered Grant a ride,
and on the way McMullan told the actor that he had been a victim of phone hacki
ng.
When Khan asked Grant to write an article on the subject for the magazine, he re
turned to McMullan s bar and secretly taped the conversation. With regard to phone
hacking, McMullan told Grant that Andy Coulson knew all about it and regularly o
rdered it. Because he didn t know he was being taped, he was generous with his accu
sations. He said Rebekah Brooks, too, knew that the practice was common, and tha
t because she rode horses regularly with David Cameron, he also must have known.
McMullan added that 20 per cent of the Met [Metropolitan Police] has taken backh

anders from tabloid hacks. So why would they want to open up that can of worms?
Quiet Settlements
During the investigation into Mulcaire and Goodman, in 2006, Scotland Yard seize
d a trove of computer records, audiotapes, handwritten notes, and paperwork of v
arious kinds. The records yielded 4,332 names or partial names of people in whom
the two men had an interest, along with 2,978 mobile-phone numbers, 30 tapes th
at appeared to contain recordings of voice-mail messages, and 91 PIN codes to ac
cess voice-mail boxes. The number of victims was potentially enormous, in other
words, and the raw material for a thorough investigation was essentially sitting
on the table.
But Scotland Yard notified only five people (beyond the princes and the royal ho
usehold) that their voice mails may have been intercepted, then let the matter r
est. Those five appeared in Mulcaire s indictment: Liberal Democrat member of Parl
iament Simon Hughes; Elle Macpherson; soccer agent Sky Andrew; Gordon Taylor, ch
ief executive of the Professional Footballers Association; and Max Clifford, a po
werful British publicist, who has made a career of brokering stories between cel
ebrities and tabloids. In May 2007 the Press Complaints Commission, a self-regul
atory body overseeing the newspaper industry, published a report on phone hackin
g in which it said that it had found no evidence of wrongdoing other than the ep
isodes that had already come out.
Two of the people notified by Scotland Yard Gordon Taylor and Max Clifford sued the
News of the World. In an effort to prevent additional names from coming to light
, the paper settled with Taylor in 2008 for more than $1 million.
Rupert Murdoch seemed to have had no knowledge of the Taylor deal a year later,
in the summer of 2009, when The Guardian reported on the settlement. If that had
happened, I would know about it, Murdoch said when asked about the payment in an
interview from the annual Allen & Co. conference, in Sun Valley, Idaho, with Blo
omberg news service, the night the Guardian story went up on the Web. The Taylor
payment had been personally approved by Murdoch s son James, to whom Rupert had h
anded control of his company s operations in Europe and Asia.
In the case of Clifford, the News of the World reached a settlement masked as a
business arrangement, agreeing to pay him roughly $1.5 million, including legal
fees, ostensibly in exchange for providing the paper with stories about his clie
nts and others. Clifford had won a court order in February 2010 demanding that M
ulcaire name people at the News of the World who had asked the investigator to t
arget him, and that he reveal to whom he had provided Clifford s voice-mail messag
es. Rebekah Brooks contacted Clifford and arranged to have lunch. We got together
and quickly resolved our differences, he told me.
After revelations about the Taylor settlement, News of the World executives and
the author of the Guardian story, Nick Davies, were called before a parliamentar
y inquiry. Les Hinton testified that we went to extraordinary lengths to investiga
te phone hacking. There was never any evidence delivered to me that suggested tha
t the conduct of Clive Goodman spread beyond him. But in the course of his appear
ance, Davies produced evidence that implicated two other News of the World repor
ters, Neville Thurlbeck and Greg Miskiw, in phone hacking. That evidence include
d e-mails from a junior reporter at the News of the World delivering transcripts
of what appeared to be Taylor s hacked voice-mail messages to Thurlbeck. And Davi
es provided another document, a contract signed by Miskiw offering Mulcaire a bo
nus if he could nail down a story the News of the World was pursuing about Taylo
r s personal life. Miskiw is widely remembered for a remark caught on tape, 10 yea
rs ago, in which he sought to explain the purpose of tabloid journalism to a you
ng reporter: That is what we do we go out and destroy other people s lives.

The British press gave virtually no attention to Davies s testimony. The theory at
The Guardian is that the use of phone hacking had become so common that many ne
wspapers were loath to point fingers. Indeed, in 2003 the Information Commission
er s Office the agency charged with enforcing data privacy and government transparen
cy had looked into the activities of another private investigator, Steve Whittamor
e, who worked for many British newspapers. Over a three-year period, the I.C.O.
revealed, more than 300 journalists had hired Whittamore. The newspapers spanned
Fleet Street and were not limited to the tabloids. The Daily Mail was the most
frequent client. The News of the World ranked fifth. News Corp. s Times of London
and Sunday Times were also among Whittamore s clients, as was the Guardian Media G
roup s Observer. The report covered not just phone hacking but other dark arts, such
as blagging (tricking organizations such as phone companies and banks into disc
losing personal information), illegal searches of police and other government re
cords, and using cell-phone numbers to get private addresses.
Operation Weeting
For a long time, The Guardian was the only newspaper that would cover the phonehacking story seriously. Frustrated by the lack of attention in Britain, Guardia
n editor Alan Rusbridger e-mailed New York Times executive editor Bill Keller an
d encouraged him to look into the phone-hacking story. In September 2010, more t
han a year after the Guardian revelations, The New York Times ran a lengthy stor
y on the scandal which quoted Sean Hoare saying that Coulson actually encouraged
phone hacking. Unnamed Scotland Yard detectives alleged that they had deliberat
ely curtailed their investigation because of a close relationship with the News
of the World. The Guardian followed up with another story and quoted Paul McMull
an, who stated that Coulson surely knew what was going on.
By the fall of 2010, references to Coulson were more newsworthy than they would
have been several months earlier, because Coulson was now the chief communicatio
ns officer for the new prime minister, David Cameron. Under pressure, Scotland Y
ard reopened its investigation to look at new evidence in other words, evidence othe
r than the ample evidence it already had in its files and it questioned Hoare and
McMullan under caution, which meant that anything they said could be used to prose
cute them. It was unusual to interview potential witnesses in a case as suspects
, a tactic that was likely perhaps intended to intimidate others who might otherwise
speak out. John Prescott, meanwhile, had been confirmed in his suspicions, and
he formally applied for a full judicial review of Scotland Yard s handling of the
case.
In December, Scotland Yard announced that it had found no new evidence of crime
in its latest inquiry, but civil lawsuits were beginning to unearth what the pol
ice had not. Lawyers for Sienna Miller claimed that one of the *News of the Worl
d *s most senior journalists, news editor Ian Edmondson, had instructed investigat
or Glenn Mulcaire to listen to Miller s voice mails, as well as those of her ex-bo
yfriend Jude Law and Law s personal assistant. Other lawsuits uncovered more names
of News of the World reporters in Mulcaire s notes, exploding News Corp. s rogue rep
orter defense.
Just before Christmas, News Corp. suspended Ian Edmondson. On January 13, the Cr
own Prosecution Service said it would mount a comprehensive review of phone-hackin
g material held by Scotland Yard. On January 21, Andy Coulson resigned as David
Cameron s director of communications, saying that continued coverage of events conn
ected to my old job at the News of the World has made it difficult for me to giv
e the 110 percent needed in this role. He went on to observe, When the spokesman n
eeds a spokesman it s time to move on. Coulson stood by his position that he was no
t aware of any phone hacking that had occurred on his watch. Five days later, af
ter News Corp. handed over a trove of e-mails, Scotland Yard announced a new inv
estigation into phone hacking Operation Weeting, it is called run by Deputy Assistan
t Commissioner Sue Akers of the Serious and Organised Crime Command, the divisio

n that usually deals with organized crime. There are now about 45 officers worki
ng on the case.
The Plaintiffs
It s hard to find anyone among a certain stratum in London these days who doesn t be
lieve his or her phone was hacked by the News of the World. Alastair Campbell, T
ony Blair s communications czar, told me he felt sure his phone had been hacked he r
emembers arranging private meetings via cell phone, only to be surprised by a Ne
ws of the World photographer when he arrived. So far, two dozen people have been
willing to step forward and take on the newspaper in the courts. The names of a
ll the litigants are not known, because many of the actions have been brought pr
ivately. Here are some of the plaintiffs:
Steve Coogan: British comedian and actor. In August 2005, the News of the World
wrote that Courtney Love claimed she was pregnant with Coogan s child. The story c
ame out shortly after Coogan and his wife had divorced. Both Coogan and Love dis
missed the story. Coogan is suing the paper and Glenn Mulcaire on the grounds th
at they intercepted his voice-mail messages and misused his private information.
Brian Paddick: A former deputy assistant commissioner at Scotland Yard (and the
highest-ranking openly gay police officer), Paddick came to the conclusion that
his phone had been hacked after the News of the World reported that he had bough
t his partner a watch while on vacation in Sydney, Australia. Paddick had told n
o one else of the purchase, but had called his bank from his cell phone to lift
the limit on his credit card.
Nicola Phillips: A former assistant to Max Clifford, she claims that the newspap
er accessed her voice mail in order to match a story that was being published in
the Sunday Mirror and the Mail on Sunday, alleging that Ralph Fiennes had cheat
ed on his girlfriend with a Romanian singer, Cornelia Crisan. Phillips was a fri
end of Ian Edmondson s. When I talked to her in April, she told me that Edmondson
called her when she first filed her court papers, in March of last year, to disc
ourage her from moving forward. I m risking everything by taking this case, in term
s of who I m taking on, and that of course is a worry, she said. I m small. I m of no in
terest to anybody. I m not a celebrity. I m not famous. I m still having to live day t
o day and having to go out and work to pay my bills. I ve been up and down over th
is. She added that she has been tempted to drop her case, but then I can t run away
because I ll bankrupt myself and be on for everybody s legal costs. If a plaintiff dr
ops a legal case, British courts require the plaintiff to pay the defendant s lega
l fees.
Leslie Ash: A British TV star, she is married to Lee Chapman, a former soccer st
ar. When Ash went to the hospital for a cracked rib and contracted a potentially
fatal hospital infection, she and her husband were hounded by paparazzi. She ha
s seen evidence from the police that shows the names and phone numbers of her so
ns, who were 11 and 13 at the time of her hospitalization, in Mulcaire s files. Sh
e believes that the News of the World was listening to messages her sons left he
r when she was in the hospital.
George Galloway: A former member of Parliament, he was informed of evidence last
fall that Glenn Mulcaire had hacked his phone. He told the BBC that the News of
the World had offered him substantial sums of money to settle his suit.
Paul Gascoigne: A former soccer star, Gascoigne alleges that the News of the Wor
ld invaded his privacy, thereby hindering his drug and alcohol recovery.
Chris Tarrant: The host of Britain s Who Wants to Be a Millionaire?, Tarrant decid
ed to sue after he found out that Mulcaire had his cell-phone number and three o
thers linked to him, including that of his estranged wife.

Kelly Hoppen: She is Sienna Miller s stepmother and an interior designer. Earlier
this year, her lawyers obtained evidence from her phone company, Vodafone, that
on June 22, 2009, the day after the Mail on Sunday wrote that Hoppen was having
a relationship with Guy Ritchie, her cell phone had been called by someone who h
ung up when Hoppen answered, and then called back to dial into her voice mail fo
r about 25 seconds. Vodafone disclosed that the calls had been made from a cell
phone registered to the News of the World in the name of feature writer Dan Evan
s. In High Court in February, lawyers for the News of the World said Evans had d
ialed the number in error.
Sienna Miller: Miller was one of the first to file a suit, and her case has driv
en many of the most important revelations. The 29-year-old s relationship with act
or Jude Law was intense tabloid fodder. They had met on the set of Alfie, in 200
3, and become engaged. Then, in 2005, Law admitted he was having an affair with
his children s nanny. The two split up. When they re-united, the tabloids speculat
ed furiously that they had become engaged again, reporting that Law had bought M
iller a grand piano for Christmas, with a diamond ring worth more than $200,000
hidden under the lid.
Miller sued News International last fall and has been tight-lipped ever since. (
Jude Law, for his part, recently won an order for disclosure against the Metropo
litan Police.) Miller did give an interview recently to The Guardian to promote
her role in the play Flare Path, in London s West End. I don t think I m going to be in
too many Murdoch papers from now on, she said in the interview. I ve bought my free
dom, in a way.
Out of the Woodwork
John Prescott is recalling his meeting with Sue Akers, of the Serious and Organi
sed Crime Command, in mid-February. For two years he had been running into a wal
l with Scotland Yard.
One school of thought about the behavior of the police throughout the phone-hack
ing affair is that they engaged in a more or less benign cover-up something akin t
o triage. The messages of Prince William and Prince Harry were intercepted at a
time when Scotland Yard was busy with counterterrorism in the wake of the London
bombings in July 2005. The police, according to this interpretation, limited th
e initial investigation and then moved on.
A second school of thought, widely subscribed to in London s newsrooms and among l
awyers involved in the case, sees a far more nefarious dynamic at play. It is th
at the police sat on evidence because they were eager to stay in the good graces
of Murdoch s tabloids, and also because key police officials had their own dirty
laundry to hide. Both Andy Hayman, who took charge of the initial inquiry, and J
ohn Yates, who was responsible for the later inquiry, in 2009, have been targete
d by the tabloids for alleged indiscretions. More broadly, tabloid newspapers an
d police departments routinely rely on one another: the tabloids want good stori
es, and the police want good coverage. Rebekah Brooks, testifying before a parli
amentary inquiry in 2003, admitted that the News of the World had paid the polic
e for information, which is illegal. (She has since backtracked from this admiss
ion.) After leaving the police force, Andy Hayman went to work for Murdoch s Times
as a columnist.
When Sue Akers sat down with Prescott, she had some news for him. We met in this
room, over there, with a cup of tea like this, Prescott says, gesturing to a tabl
e across the room. And then she told me that they have discovered that my chief o
f staff, Joan Hammell, had her phone tapped into 45 times with messages from me.
He pauses. Now, what is significant in all these things is that the date they did
the tapping was the date that I was exposed as having an affair, and what they

wanted was more information about the affair.

Prescott relates the story matter-of-factly. The date was April 26, 2006. On tha
t day the Daily Mirror published its story about John Prescott s affair with his a
ppointments secretary, Tracey Temple. Then it was all the press who wanted me. Oh,
Prescott, let s get him,
he growled. So they want a story, any story, any informatio
n to get ahead because the story had broken somewhere else. Anyway, I was surpri
sed how it broke and I rang Joan. He pauses. I admitted it right away, by the way.
I never go into such a ducking and diving. There s no point once the press are on
it. You might as well put your hands up he puts his hands up and say, That s it. So I
g Joan. When I tried to get her, she often said to me, You never left me a messag
e. But I left her messages to ring, and she never got them. It is Prescott s suspici
on that those messages had been intercepted by Glenn Mulcaire or someone else wo
rking for the News of the World, and deleted.
When I ask Prescott why he thinks it took so long for the police to get in touch
with him and provide specific information about his case, he doesn t hesitate. Mur
doch left it to this woman called Rebekah Wade, who I can t bloody stomach.
Rebekah Wade now Rebekah Brooks at the time was the editor of Murdoch s Sun newspaper
and is today chief executive of News International. She once famously spent a ni
ght in jail after her first husband, British soap-opera star Ross Kemp, of EastE
nders, called the police, saying she had struck him during a domestic dispute. B
rooks has become a central figure in the phone-hacking scandal because of her st
eadfast loyalty to the Murdochs and her perceived influence in British society a
nd politics. At her wedding in 2009, to her second husband, Charlie Brooks, a ra
cehorse trainer, David Cameron and Gordon Brown were both guests.
As Prescott tells it, Rebekah Brooks was used to manipulating the press, the pol
ice, and politicians, and so must have thought News Corp. could control the phon
e-hacking story. Certain aspects of it would have made her especially nervous. T
he investigator Mulcaire had a habit of writing the name of any reporter he was
working with in the top left corner of his notes. Mulcaire s notes mention four fi
rst names that appear to be those of reporters and editors at the News of the Wo
rld: Clive Goodman, Ian Edmondson, Greg Miskiw, and Neville Thurlbeck. There was
great incentive at News Corp. to keep the story bottled up. Perhaps the police
could help with containment? That possibility aside, the first line of defense h
ad been the rogue reporter story. A second defensive maneuver consisted of the set
tlement payouts. Eventually an editor, Edmondson, had to be fingered.

Prescott said, They thought [the early settlements] would put it to bed, because
News Corp. were so powerful. We ll forget this story it s yesterday s news. That s what t
thought they could do. They had the police on their side. So this whole structu
re was working to this one bloody stupid story, which was the rogue reporter. Th
ey knew if it opened up it would go right down the line, so they tried to hold i
t. Then Murdoch discovered that whatever she had done wasn t holding the line at a
ll if anything, it was, most of it, coming out from the civil inquiries, and then
more people started coming out of the woodwork. Eventually, Murdoch went to Londo
n to assess the situation for himself. The story that she kept telling, I presume
, was Don t worry we ve got it in hand.
Prescott needs no encouragement to think ill of Rebekah Brooks. He is convinced
that she ingratiated herself with British politicians, then used her position to
pit them against one another. When I was trying to keep the balance between Brow
n and Blair, who didn t always get on, Blair would complain that Brown had said so
mething, and I would say, Where did you find that out? Well, Rebekah Wade told me. T
hen the other one would have dinner with Rebekah Wade and tell Brown about Blair
. He looks scornfully into the distance. I said, This bloody woman is playing the t
wo of you off each other will you bloody dump her, for Christ s sake!
(Rebekah Brooks
declined to be interviewed for this story.)

Berlusconi Moment

From the perspective of News Corp., the expanding attention to the phone-hacking
scandal has transformed it from a local nuisance in London to something that re
presents a major headache for the entire company. By the fall of 2010, for the f
irst time, top executives in New York were paying attention. As Murdoch saw it,
media coverage of phone hacking was just an example of his competitors using the
ir news pages to attack his commercial interests intolerable when done by others.
Specifically, he believed, they were trying to scuttle his company s deal for the
satellite broadcaster BSkyB by making News Corp. seem to be a criminal enterpris
e.
BSkyB is a public satellite-broadcasting company with more than 10 million subsc
ribers. It offers broadband Internet and telephone service and distributes telev
ision programs and movies through its on-demand offerings. James Murdoch can be
credited with its impressive growth. But some commentators have referred to Rupe
rt Murdoch s takeover of BSkyB as Britain s Berlusconi moment, referring to Italian pr
ime minister Silvio Berlusconi, who in addition to serving as the country s prime
minister also controls three national television channels, a publishing house, a
n advertising-and-publicity agency, and two newspapers.
In June 2010, less than a month after David Cameron became prime minister, News
Corp. announced its offer to purchase the portion of BSkyB that it did not alrea
dy own some 61 percent. Negotiations duly got under way. In October, an alliance o
f media companies opposed to News Corp. s acquisition of BSkyB wrote to Vince Cabl
e, the business secretary, saying the deal could have serious consequences for me
dia plurality (that is, competitiveness) in Britain. The following month, Cable a
sked British and European regulators to investigate the merger.
Throughout January, there was a flurry of correspondence among News Corp., BSkyB
, and Jeremy Hunt, the British member of Parliament in charge of reviewing the m
erger. Most of it had to do with Hunt s requirement that News Corp. insulate Sky N
ews from the rest of the company and limit News Corp. s sizable market share in Br
itain. As he had before with The Times of London, The Sunday Times, and The Wall
Street Journal, Murdoch proposed an editorial independence committee for Sky News a
patently unworkable scheme that has previously come to naught. On January 25, H
unt gave his view that the merger may operate against the public interest in medi
a plurality, and said that he intended to refer the matter to the Competition Com
mission. But he gave News Corp. one more chance to amend its proposal. Rupert Mu
rdoch flew to London to deal with the matter directly.
The British press gave considerable coverage to Murdoch s arrival. It would be a b
usy week for him. On January 26, Ian Edmondson, the suspended News of the World
editor, was formally dismissed from his job. The same day, Scotland Yard announc
ed its new inquiry.
Over the past several months I ve asked News Corp. executives what they think of t
he phone-hacking story and where it will end. They have done their best to shake
their heads and look amused, if a bit beleaguered. I sat down with several of t
hem in February in the company s new London headquarters, not far from the famous
Wapping compound that Murdoch secretly built in the 1980s so he could print his
papers outside London and break the print unions. The headquarters, unlike the W
apping fortress, is light and airy. Across the courtyard, I could see James Murd
och s office through the large windows around it. He was not in there. I noted tha
t James had moved from the old office his life-size Darth Vader statue, a totem
he has carried with him since his days running News Corp. s Star TV in Asia, which
competitors referred to as the Death Star.
The News Corp. executives told me that, from their perspective, there were three

main elements of the phone-hacking story that needed to be dealt with. They bel
ieved they had two of them pretty well in hand.
The first was political. The resignation of Andy Coulson, they said, had slaked
the Labour Party s fervor for the cause. Indeed, they pointed out that, just two w
eeks after Coulson resigned, Labour M.P. s received a widely publicized e-mail fro
m a top Labour adviser (and former Times of London journalist) to stop stoking t
he phone-hacking debate: We must guard against anything which appears to be attac
king a particular newspaper group out of spite.
The second element was the business fallout. When I met with them, the News Corp
. executives seemed optimistic that the BSkyB deal would go through and once it di
d, rivals would stop using phone hacking as a battering ram. In early March, the
British government announced that it had indeed cleared the deal after News Cor
p. agreed to spin off Sky News.
The third element is the private civil lawsuits. These are proving more difficul
t to contain. The executives I spoke with felt that, once people realized there
wasn t much money to be made in chasing the News of the World for breaches of priv
acy, lawyers would have a difficult time signing up new clients. That may be wis
hful thinking. The police have identified 91 alleged victims of phone hacking in
their latest investigation a list that is likely to grow. Tom Watson, one of the
British members of Parliament most critical of News Corp. s handling of the episod
e, recently noted that solicitors are buying Google ads that pop up whenever you
search for the phrase phone hacking. One lawyer suing the News of the World recen
tly estimated that damages from the suits could result in settlements totaling b
etween $150 million and $250 million. News Corp. is hoping it can settle the cas
es for less than $30 million.
Beyond Britain
Those who have decided to challenge the News of the World in court have an unexp
ected ally in the person of Max Mosley. The mild-mannered Mosley did not have hi
s phone hacked, but he has been on the receiving end of the *News of the World *s
attentions. Mosley had been largely an unknown figure, outside of Formula One ci
rcles, where he served as the president of the governing body, until the News of
the World, in 2008, plastered photos of him engaging in what the paper called a
SICK NAZI ORGY WITH 5 HOOKERS. Mosley sued the News of the World for invasion of
privacy. He admitted to engaging in consensual sadomasochism with the women, but
denied that the episode had any Nazi overtones. He was particularly sensitive t
o any reference to Nazism, given that his father, Sir Oswald Mosley, had founded
the British Fascist party and married his mother, Diana Mitford, at the home of
Hitler s propaganda chief, Joseph Goebbels.
Mosley won his suit, and the judge ordered the paper to pay him $120,000, the la
rgest-ever award in a privacy case. News of the World also had to pay Mosley s leg
al fees, which neared $900,000. Mosley has pursued the case all the way to the E
uropean Court of Human Rights, in Strasbourg. He is seeking to require by law th
at British newspapers notify their subjects before printing a story about their
private lives.
More pointedly, Mosley has agreed to use his own resources to fund phone-hacking
lawsuits against News Corp.: In a number of cases, I ve said to people, If you lose
, I ll stand behind you.
Because of the way the British legal system operates, such
backing is significant. As noted, unlike in the U.S., in Britain, if a party bri
ngs a suit and loses, that party is typically required to pay legal fees for the
defendant. In Britain, to bring a lawsuit, you either have to have no money at a
ll or be eccentric, Mosley says. He places himself in the latter category.
There will continue to be fallout, beyond the recent arrests and the admission o

f guilt by News Corp. It is likely that other current and former News of the Wor
ld journalists will find themselves in legal jeopardy. If one of them switches s
ides and starts to talk, the repercussions could be significant. In the meantime
, News Corp. has been covering Glenn Mulcaire s legal fees.
The position of Rebekah Brooks inside News Corp. at the moment appears secure. I
n January, she took her top executive team to Babington House, a private club in
Somerset, in part to discuss how to minimize the damage from the phone-hacking
inquiry. It was there that they started hammering out the settlement strategy. I
n late March, she delivered her three-year plan for the U.K. newspapers to Murdo
ch himself, which executives at the company took as a sign that his support for
her remains undiminished.
In March, James Murdoch was named deputy chief operating officer of the company,
a position that brings him to News Corp. s headquarters in New York. He may not s
hake the impression that he has mishandled this affair, or that his father had t
o fly in personally to sort it out. ( He s an idiot, Prescott told me. The kids are ne
ver up to their fathers, are they? ) But James is in fact a good businessman, and
such perceived weaknesses are hardly going to keep Rupert Murdoch from handing h
is company over to his children.
The phone-hacking scandal is in some ways a quintessentially British affair, the
product of a small and inbred society in which the elites in every sector are c
onnected with one another through ties of business, family, politics, money, and
sex. The connections are hard to disentangle, and a tug on any thread is felt b
y all the others. But the lessons go beyond Britain. They would apply, for insta
nce, to the United States, where many of the potential Republican nominees for p
resident have been on the payroll of Murdoch s Fox News. They apply to any society
in which relationships between press and public servants cross a line of intima
cy, and deciding where one s loyalty lies takes more than a moment s thought.
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