U.S. lawmakers seek probes of News Corp

WASHINGTON Thu Jul 14, 2011 5:15am IST

The News Corporation building is seen in New York, July 13, 2011. REUTERS/Brendan McDermid

The News Corporation building is seen in New York, July 13, 2011.

Credit: Reuters/Brendan McDermid

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WASHINGTON (Reuters) - U.S. lawmakers urged federal officials to investigate whether News Corp broke a law banning bribes to foreign officials, increasing transatlantic pressure on Rupert Murdoch's media empire.

As Murdoch withdrew his bid for broadcaster BSkyB (BSY.L) in Britain on Wednesday under a hail of criticism over a alleged crimes at his newspapers, three U.S. senators called for probes by the Justice Department and the Securities and Exchange Commission.

Former journalists at News Corp's now-closed News of the World paper in Britain have been accused of paying London police officers for information.

The U.S. Foreign Corrupt Practices Act (FCPA) prohibits payments intended to influence any act or decision of a foreign official.

Democratic Senators Barbara Boxer, Jay Rockefeller and Frank Lautenberg on Wednesday asked Attorney General Eric Holder and SEC Chairman Mary Schapiro to look into potential FCPA violations.

"The reported allegations against News Corporation are very serious and indicate potentially thousands of victims and a pattern of illegal activity. It is important to ensure that no United States laws were broken and no United States citizens were victimized," Rockefeller and Boxer wrote in a letter to Holder and Schapiro.

As a U.S.-based company, News Corp and its employees are subject to the anti-bribery provisions of the FCPA, Lautenberg said. If bribes were made and not properly recorded in the company's books, this would also be a violation, he added.

"The limited information already reported in this case raises serious questions about the legality of the conduct of News Corporation and its subsidiaries under the FCPA," Lautenberg said in a separate letter to DOJ and SEC.

A Justice Department spokeswoman said the letters would be reviewed as part of standard practice, but that did not mean an investigation would be initiated.

News Corp did not return requests for comment.

Although Murdoch's media outlets are often perceived as leaning toward the right politically, at least one Republican lawmaker called for the FBI to get involved.

Representative Peter King of New York, chairman of the House Homeland Security Committee, urged the Federal Bureau of Investigation to look into allegations that the News of the World also tried to illegally access telephone records of victims of the Sept. 11, 2001, hijack attacks through bribes to U.S. law enforcement officials and illegal wiretapping.

"The 9/11 families have suffered egregiously, but unfortunately they remain vulnerable against such unjustifiable parasitic strains. We can spare no effort or expense in continuing our support for them," King wrote in a letter to FBI Director Robert Mueller.

News Corp, in addition to newspapers in Britain, owns the Wall Street Journal, Fox Broadcasting, the New York Post and other media properties in the United States.

News Corp shares rose after the company said it was withdrawing its $12 billion bid to buy out the 61 percent of broadcaster BSkyB it does not already own. The shares jumped 3.8 percent to close at $15.93 on Wednesday after a week of steady declines.

(Reporting by Jasmin Melvin; Editing by Tim Dobbyn)

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