Media and information services company News Corp. (NWS,NWSA) revealed Monday in a regulatory filing that the U.S. Department of Justice has declined to prosecute it or Twenty-First Century Fox, Inc. (FOX,FOXA) related to the phone hacking scandal in the U.K. The DoJ has closed its investigations without filing any charges.
In two separate Form 8-K filing with the U.S. Securities and Exchange Commission, the companies have stated that the DoJ has completed its investigation of voicemail interception and payments to public officials in London and is declining to prosecute News Corp or Twenty-First Century Fox.
News Corp's British newspaper unit, News of the World, is said to have hacked into phones to intercept private voicemails and bribed public officials in the U.K. for obtaining news leads.
The scandal emerged in November 2006 when the 168-year-old tabloid's former royal editor Clive Goodman and its private detective Glenn Mulcaire admitted hacking the phones of aides to the royal family. They allegedly extracted private information about former British Prime Minister Gordon Brown and members of the Royal family.
The scandal shocked Britain's political elite and British Prime Minister David Cameron had ordered a public inquiry into unethical reporting ethics. Charges were also slapped on Rebekah Brooks and Andy Coulson, who were both former editors of the News of the World.
News Corp then moved to restructure operations after its British newspaper division got involved in the embarrassing phone hacking scandal that finally led to shuttering of its age-old 'News of the World' tabloid in July 2011 and the arrest of Brooks, the then CEO of News Corp.'s British newspaper subsidiary News International. The scandal has reportedly cost the company about $551 million in settlements and legal fees since June 2013.
News Corp. split itself into two public companies in June 2013. The publishing business retained the parent company's name, and includes The Wall Street Journal, the Times of London, The Australian newspaper and HarperCollins book publishing.
Meanwhile, the entertainment businesses is now known as Fox Group, and includes 20th Century Fox film studio, Fox broadcast network and Fox News channel.
The DOJ has now closed its investigation into possible violations of the Foreign Corrupt Practices Act on the two companies. It had launched the investigations way back in June 2011.
NWS closed Monday's regular trading session at $14.48, up $0.04 or 0.28% on a volume of 0.87 million shares, and FOX closed at $32.46, up $0.61 or 1.92% on a volume of 2.34 million shares.
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