LONDON—The U.K. parliamentary committee probing illicit voice mail interception by News Corp.'s shuttered News of the World tabloid released a final report Tuesday concluding that News Corp. Chief Executive Rupert Murdoch is "not a fit person to exercise the stewardship of a major international company" and accusing several former company executives of misleading parliament.
A U.K. parliamentary committee probing phone-hacking released a final report condemning News Corp. chief Rupert Murdoch and accused several former company executives of misleading parliament. WSJ's Bruce Orwall reports. Photo: Getty Images
The report says Mr. Murdoch and his son, News Corp. Deputy Chief Operating Officer James Murdoch, presided over a culture of "willful blindness" at News Corp. It also singles out James Murdoch for displaying a "lack of curiosity," even "willful ignorance," when handling fallout from the phone-hacking scandal as the manager overseeing News Corp.'s British newspaper unit, News International, from late 2007 to 2012.
The report also says three former executives of News Corp.'s U.K. newspaper unit misled parliament in 2009: Les Hinton, a top Murdoch lieutenant who was the unit's executive chairman from 1995 until late 2007, when he became chief executive of News Corp. unit Dow Jones & Co.; Colin Myler, the News of the World's editor from 2007 until its closure last year; and Tom Crone, the tabloid's top lawyer.
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News Corp. issued a statement saying it is "carefully reviewing" the report and will respond shortly. It added that the company "fully acknowledges significant wrongdoing at News of the World and apologizes to everyone whose privacy was invaded."
Mr. Hinton issued a statement Tuesday saying he is "shocked and disappointed" by the report's conclusion. "I refute these accusastions utterly," Mr. Hinton said. "I have always been truthful in my dealings with the committee and its findings are unfounded, unfair and erroneous." Mr. Hinton said he planned to write to the committee's chair "to object formally."
Messers. Crone and Myler couldn't immediately be reached for comment. Messrs. Crone, Myler and Hinton have all left the company. News Corp. owns Dow Jones, publisher of The Wall Street Journal.
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Read the U.K. parliamentary report
The committee says a number of assertions the former executives made in 2009 were untrue, including the claim that illegal voice mail interception was limited to one reporter and the assertion that phone hacking had been investigated thoroughly by the company. The report says News Corp.'s instinct throughout the affair was to "cover up rather than seek out wrongdoing and discipline the perpetrators."
In a news conference Tuesday, the U.K. Parliament's Culture, Media and Sport Committee said all of its 10 members supported the report's conclusions about Les Hinton, Tom Crone and Colin Myler. But Conservative Member of Parliament Louise Mensch said the Conservative MPs on the committee voted against the final report largely because of the line saying Rupert Murdoch isn't a "fit person" to run a global company. Ms. Mensch said the report should therefore be seen as "partisan." It passed with the support of six Labour and Liberal Democrat legislators. Four Conservatives opposed it.
The report's denunciation of Rupert Murdoch as an "unfit" steward for an international company could play into the deliberations of Ofcom, the U.K. communications regulator, which is evaluating whether the owners of British Sky Broadcasting Group PLC are "fit and proper" to hold a British broadcasting license in light of the phone-hacking scandal.
News Corp. owns 39.1% of BSkyB and holds a number of the pay-TV giant's board seats. The possibility of losing BSkyB's broadcasting license is perhaps the biggest remaining risk to News Corp., because a revocation of the license would throw into jeopardy one of the media conglomerate's most lucrative properties.
A spokesman for U.K. Prime Minister David Cameron said the government will "consider the report." Regarding the committee's finding that Rupert Murdoch isn't a "fit person" to run a global company, the spokesman added: "That is a matter for the regulatory authority, not the government, to decide."
The report looked specifically at whether executives from News Corp.'s U.K. newspaper unit, News International, misled the committee during hearings on phone hacking in 2009.
"The behaviour of News International and certain witnesses in this affair demonstrated contempt for [the parliamentary] system in the most blatant fashion," the report concludes.
The committee plans to ask the House of Commons, the U.K. Parliament's primary lawmaking chamber, to make a final decision on "whether a contempt has been committed and, if so, what punishment should be imposed." It isn't a given that the House of Commons will vote on the matter.
Misleading a parliamentary committee isn't a criminal offense—witnesses generally don't testify under oath—but it can constitute contempt of parliament, a noncriminal sanction levied against people who impede parliament's work. The report didn't say what the punishment would be other than "reputational damage and public opprobrium."
The report didn't accuse Rupert or James Murdoch of misleading parliament but said the pair presided over an affair that "demonstrates huge failings of corporate governance."
The committee said the arrest last July of former News International Chief Executive Rebekah Brooks made it difficult to make a pronouncement on her role in the affair. Ms. Brooks resigned from her post last July and was subsequently arrested twice. She has not been charged.
The report released Tuesday is the latest debacle for News Corp. in a long-running scandal, which first began six years ago but then exploded more prominently last July when it was revealed that the News of the World hacked the phone of a missing 13-year-old girl who turned out to be murdered.
The scandal has already exacted a large toll. Since last summer, the furor has resulted in the News of the World's closure; the resignation of top News Corp. executives; and the collapse of the U.S. media conglomerate's bid to take full control of BSkyB.
News Corp. appointed Mr. Murdoch deputy chief operating officer in March of last year, just as the phone-hacking scandal began to reignite in Britain, and said he would be relocating from London to New York.
Once considered an heir apparent to his father, James Murdoch has seen his future clouded at the company by his handling of the hacking scandal.
The phone-hacking matter first shot to attention in 2006, when a British court convicted the News of the World's royal correspondent and a private investigator on the tabloid's payroll for intercepting the voice mails of aides to the British royal family. The following year, the court sentenced the correspondent and private investigator to four and six months, respectively. News Corp. long said the wrongdoing at the News of the World was isolated to those two individuals—a claim that later proved false, and which the company admitted.
Last July, the matter erupted into a scandal for News Corp. The ensuing public outcry led the committee to reconvene its investigation of British press standards and phone hacking, with a particular focus on looking at whether and how News Corp. executives misled the committee in prior testimonies.
Today, News Corp.'s British newspapers are at the center of several continuing British criminal probes looking at voice mail interception and allegations of bribery, obstruction of justice and computer hacking. Some 43 people have been arrested, including current and former News International employees. None has been charged. News International says it is cooperating with all the probes.
—Ainsley Thomson and Bruce Orwall contributed to this article.
Write to Paul Sonne at paul.sonne@wsj.com and Jeanne Whalen at jeanne.whalen@wsj.com
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