MPs to rule on James Murdoch's version

James Murdoch (left) and Tom Watson, who told the NI head: "You must be the only mafia boss in history who didn't know he was running a criminal enterprise" (PA)

MPs will rule on whether James Murdoch told them the truth about when he was informed of the extent of phone hacking at the News of the World.

The News International boss rejected claims by two of his former executives that they told him in 2008 about an email revealing that the practice went beyond a single "rogue reporter".

Mr Murdoch was described by Labour MP and phone-hacking campaigner Tom Watson as a "Mafia boss" as he made a stormy second appearance before the Commons Culture, Media and Sport Committee today.

He rejected the description but apologised "unreservedly" to Mr Watson over New International's hiring of a private investigator to spy on the politician.

The media boss said he "disputed vigorously" the version of events put forward by former News of the World editor Colin Myler and News International legal chief Tom Crone, who say they made him aware of the contents of the famous "For Neville" email.

He accused the pair of giving "misleading" evidence to the committee about what they told him at a June 2008 meeting to discuss settling a legal claim brought by Professional Footballers' Association chief executive Gordon Taylor over phone hacking.

Culture Committee chairman John Whittingdale said the MPs would now have to decide whether to believe Mr Murdoch or Mr Crone and Mr Myler.

"It is plain that the two accounts we've heard, one of them cannot be true," he told reporters after the hearing.

Mr Whittingdale confirmed that Parliament could impose sanctions if the committee concludes that either Mr Murdoch or his former executives misled MPs.

He said: "We haven't yet reached that conclusion. If we were to do so, we would report that to the House of Commons and it would be for the House of Commons to determine what further steps to take."

In an often heated session lasting two hours and 37 minutes, Mr Murdoch insisted his News International executives did not fully inform him of the growing evidence that phone hacking at the News of the World was more widespread than had been admitted.

The now-defunct Sunday tabloid's royal editor, Clive Goodman, and private investigator Glenn Mulcaire were jailed in January 2007 for illegally intercepting voicemails.

Mr Murdoch admitted that he was made aware of the existence of the "For Neville" email, which contained transcripts of hacked messages from Mr Taylor's mobile phone and was apparently intended for News of the World chief reporter Neville Thurlbeck.

But he said he was not shown it or told its full contents by Mr Crone and Mr Myler when they discussed settling Mr Taylor's case on June 10 2008.

"The so-called 'For Neville' email - now referred to as the 'For Neville' email but not then referred to as the 'For Neville' email - was mentioned to me as evidence that was important with respect of it being a transcript of a voicemail interception that came through, that proved it was on behalf of the News of the World," he told MPs.

"It was not shown to me, nor was it discussed with me its other feature - that it was 'For Neville', and that it might indicate wider-spread knowledge or wider-spread activities of phone hacking."

Mr Watson told the hearing that he had met Mr Thurlbeck, who claimed that Mr Crone said he showed the email to Mr Murdoch.

Mr Murdoch replied: "Mr Crone, I think, testified to you that he did not show me the email.

"My understanding is now that the email was subject to some particularly stringent confidentiality agreement with Mr Taylor's attorneys and the police, or something like that.

"Mr Myler was part of that confidentiality ring, I believe, but it was not shown to me at all. I've only recently seen the email itself."

Asked whether he thought that Mr Myler and Mr Crone had misled the committee, Mr Murdoch replied: "Certainly in the evidence they gave to you in 2011 in regard to my own knowledge, I believe it was inconsistent and not right, and I dispute it vigorously."

He added: "I believe their testimony was misleading and I dispute it."

Mr Murdoch suggested that Mr Myler, who was brought in as editor in 2007 to investigate the phone-hacking scandal and clean up the News of the World, should have informed him of how widespread the practice was.

"If he had known, which is an if, that there was wider-spread criminality, that there was evidence or sufficient suspicion of that, I think he should have told me of that," he said.

Mr Murdoch added: "I wouldn't call this a failure of governance. I think there was a failure of transparency.

"We had individuals who were not making transparent information that was relevant and could have been more consequential to a higher level."

Committee member Paul Farrelly pressed Mr Murdoch on why a pay-out was made to Mr Taylor when News International was maintaining that phone hacking at the News of the World was confined to Goodman and Mulcaire.

The MP said: "Gordon Taylor was not a member of the royal family or the royal household. Did you not say 'He's not royal?"'

Mr Murdoch said he had not focused on the details of the specific voicemail or the fact that Goodman was a royal reporter.

The News International boss condemned his company's use of a private detective to spy on lawyers Mark Lewis and Charlotte Harris, who are representing phone-hacking victims, as "appalling" and "unacceptable".

He said the decision to place them under surveillance was taken by Mr Crone and another unnamed News of the World executive.

Mr Murdoch agreed with Ms Mensch that it was "completely despicable" that a private investigator followed Mr Lewis's family, including his 14-year-old daughter.

Ms Mensch asked Mr Murdoch if he was aware that private detectives looked into the background of every MP who was on the Culture Committee at an earlier time when it was investigating News International.

"I am aware of the case of surveilling Mr Watson, and again I think under the circumstances I apologise unreservedly for that," he replied.

"It is not something that I would condone, it is not something I had knowledge of, and it is not something I think that has a place in the way that we operate."

Mr Murdoch also apologised for The Sun's coverage of the 1989 Hillsborough tragedy, when 96 Liverpool football fans were killed by crushing in overcrowded spectator pens.

And he did not dismiss the possibility that the daily tabloid could be closed down, as the News of the World was, if evidence emerged to prove its reporters were involved in phone-hacking.

The News International executive chairman told the committee: "I think it is important to not prejudge the outcome of any investigation. Nor is it appropriate to prejudge any actions the company might take.

"I don't think we can rule - and I shouldn't rule - any corporate reaction to wrong-doing out. That will be a decision taken at the time given whatever is out there."

Mr Watson suggested that News International operated a pact like the Mafia's code of silence known as "omerta", something Mr Murdoch dismissed as "offensive and not true".

The MP went on: "You must be the first Mafia boss in history who didn't know he was running a criminal enterprise."

Mr Murdoch replied: "Mr Watson, please, I think that's inappropriate."

Speaking after the hearing, Mr Watson conceded that it was possible Mr Murdoch did not realise the scale of phone hacking at the News of the World.

He said: "It is plausible that he didn't know but if he didn't know, he wasn't asking the questions that a chief executive officer should be asking.

"Either he wasn't doing his job properly as the chief officer of the company or he did know."

PA