FBI Launches News Corp. 9/11 Hacking Investigation — Murdoch Defends His Company (Updated)

Rupert Murdoch defended his company's response to the allegations in an interview with the WSJ

UPDATED 6:42 PT:

The News Corp. scandal deepened further on Thursday with numerous developments – including the launch of an FBI investigation – boding ominously for the media giant.

The latest updates:

>> The FBI announced an inquiry into the alleged hacking of the cellphones of victims of 9/11 by News Corp. reporters.

>> News Corp.'s second biggest shareholder Al-Waleed Bin Talal called for the resignation of News International Chief Executive Rebekah Brooks.

>> Murdoch took to the pages of his own Wall Street Journal to defend the company, claiming it has dealt with the crisis "extremely well in every way possible."

>> News Corp. has hired Brendan V. Sullivan, Jr., a partner in the Washington, D.C., law firm, Williams & Connelly, according to the New York Times. Sullivan once defended disgraced former Marine Oliver North. 

The Murdoch interview had the air of too little too late. The CEO granted the interview to an employee, meaning that the questions were far from penetrating.

The story did not mention the FBI probe, did not acknowledge that Murdoch's former employees have been arrested and did not go into any detail regarding the "dubious reporting tactics" (let alone mention the alleged bribery of public officials). Instead, it emphasized the internal investigation Murdoch promised, which will be conducted by an independent committee and led by a “distinguished non-employee.”

Murdoch was defensive when asked about wrongdoing at his company, and admitted only to “minor mistakes.”

The FBI investigation is expected to look into whether reporters from News Corp.'s shuttered British tabloid the News of the World attempted to hack the phones of 9/11 victims. Details of the investigation are not yet known – as policy, the FBI does not even confirm or deny ongoing investigations – but the New York Times reported it will be handled by a pair of FBI squads in the New York office.

In the U.K., targets of the alleged hacking range from a murdered teen Milly Dowler to the victims of the train bombing in London. The allegations about 9/11 victims touched a particularly sensitive nerve in the United States, which is one reason Rep. Peter T. King, a Republican from New York, sent a letter to FBI director Robert Mueller on Wednesday calling for the bureau to launch such an inquiry.

On Thursday evening, the Columbia Journalism Review questioned the Mirror story that leveled the 9/11 allegations this week, calling the reporting unsubstantiated.

Regardless of the allegations’ veracity, this may be the first in a long line of legal challenges in the U.S. Four Senators asked the Department of Justice and Securities and Exchange Commission to launch investigations as well. The offices of Sen. Barbara Boxer, Frank Lautenberg and Jay Rockefeller did not respond to calls.

The Senators called for inquiries examining not just phone hacking but bribery as well. Such an investigation would look at violations of the Foreign Corrupt Practices Act, which prohibits U.S. citizens from bribing foreign officials.

These ongoing and potential U.S. investigations follow closely on the heels of previously announced U.K. inquiries. Rupert and James Murdoch will testify before the Culture, Media and Sport committee on Tuesday. Rupert initially declined to appear and James had said he could not until August, but the official summons led both of them to cave. Brooks has agreed to appear as well.