AP Enterprise:
UK tabloid paid spies for scoops

[September 29, 2011]  LONDON (AP) -- No one suspected the secretary.

Efficient, well-dressed and well-liked, Sue Harris was at the heart of the Sunday People, the smallest of Britain's weekly tabloids. She booked flights, reserved accommodation, and tallied expenses for the populist paper's dozen or so full-time reporters. A petite, 40-something south Londoner who'd spent most if not all of her working life at the tabloid, journalists there trusted her implicitly.

Maybe they shouldn't have.

In 1995 Harris was dismissed over an allegation that she'd been feeding her paper's juiciest scoops to Piers Morgan's News of the World, betraying her co-workers for a weekly payoff of 250 pounds -- then worth about $375. Although People journalists had long believed there was a traitor in their midst, they were shocked when Harris was exposed.

"Everybody knew there was a mole," said a former senior journalist with the People. "We never thought the person we were looking for was her."

The journalist, who was there when Harris was fired, was among three former colleagues who recounted her story to The Associated Press, speaking on condition of anonymity because they still work in the media industry.

Harris' alleged spying on behalf of the News of the World wasn't unique, an AP investigation has found. Interviews with three more former journalists and published accounts suggest that Rupert Murdoch's flagship Sunday tabloid engaged in a pattern of payoffs aimed at rival newspaper employees.

The News of the World was closed in July as evidence of illegal conduct there became inescapable. Although accusations that the paper hacked into phones and corrupted police officers to win scoops have been widely aired, the paper's efforts to subvert rival newspaper employees have seen less attention.

American investigators are already examining whether the News of the World's parent company, New York-based News Corp., broke U.S. anti-corruption laws by bribing British officials. Legal experts now say that payments made to rival journalists could make it more difficult for the media conglomerate to defend itself against any potential prosecution.

The corporate espionage campaign also calls into question the ethics of Morgan, who edited the News of the World between 1994 and 1995 and who once boasted that having rivals on his payroll meant that he and his colleagues "always know exactly what our competitors are doing."

Story theft has long been a big worry for Britain's Sunday tabloids, who only get one shot a week at making an impression on their readership. Particular concern surrounds the "splash" -- the front page story which acts as an advertisement for a paper's journalism.

At the People as with other tabloids, journalists took extreme measures to keep a potential splash under wraps. Sources would be paid compensation in return for exclusive access or sequestered at out-of-the way hotels for days at a time to keep them away from rival reporters.

Keeping the splash secret was particularly important for the cash-strapped People. If the News of the World got wind of a story, the Murdoch tabloid's massive budget meant it could easily outbid the People for interview rights.

But no secret was safe from Harris, who spent years sitting a few feet from the People's senior editors. Former journalists say that, thanks to the weekly payments made by the News of the World, the People's powerful rival knew everything too.

The effect on reporters was devastating. A People journalist sent by plane to Edinburgh was disconsolate when he found a News of the World team on the same flight. A writer huddled with his source at an obscure hotel outside of London was shocked to discover his paper's biggest rival at the downstairs bar. A team of People reporters who'd spent days staking out the home of a young woman seethed when they saw their competitors walk up to the front door.

People journalists would routinely spend days putting together a splash only to be ambushed at the last minute by the News of the World, who would outbid them for the story. Suspicion grew as exclusives kept getting spoiled.

"It was a kind of frustrating paranoia," said a journalist who held a mid-ranking job at the paper at the time. "There had to be a mole. But everyone looked around the office and at who sat next to them, and no one believed it could be anyone there."

Something similar was happening at one of the People's sister papers, the Sunday Mirror, where reporter Chris House was accepting about 1,000 pounds a month to leak his colleagues' stories.

In his 2005 book, "The Insider," Morgan recalled one of the disclosures: The news that a popular British television presenter was having an affair.

Morgan said the Sunday Mirror had spent three months working on the story only to have it stolen out from under them the day before it was due to run.

"If I was their editor I'd want to top myself," he crowed, using British slang for "suicide."

It isn't clear when the News of the World began paying for rivals' stories, although Morgan's book suggests that the practice predated his installment as editor there. The senior journalist at the People said he was warned as far back as 1992 that there was a mole on the paper.

Morgan turned on his informants when he became editor of the Daily Mirror, which shares the same publisher, Trinity Mirror PLC, as the Sunday Mirror and the People. Now working for the other side, he said he gave the pair a month to stop taking bribes.

"Incredibly they had just carried on, so I fired them," he wrote.

House, who now lives in the English cathedral city of Winchester, declined comment when reached by the AP. Contact information for Harris couldn't be located, and attempts to trace her through her former colleagues were unsuccessful.

The loss of two of its informants didn't deter the News of the World. In 1999, Trinity Mirror threatened to sue the paper over an alleged attempt to bribe Sunday Mirror investigative correspondent Dennis Rice.

Rice turned down the bribe, and the matter was settled out of court amid claim and counter-claim. The Sunday Mirror's then-editor Colin Myler later fired off a letter to the Evening Standard complaining that "this is the third time the News of the World has offered money to Mirror Group employees for our confidential information."

A former News of the World reporter who worked at the paper through all three episodes said that bribery would have been "business as usual" at the newspaper.

"No one would have thought it was ethically dodgy," he said, speaking anonymously because he too still works in the media industry. "It was dog eat dog and whatever got results was welcomed."

Buying the loyalty of rival journalists would not have broken British bribery laws, which were only recently updated to cover payments made to competitors. Nor would they have run up against the U.S. Foreign Corrupt Practices Act -- which only applies to foreign officials.

But legal experts say that if a prosecution were brought under the act for bribing police, then the payments offered to House, Harris or Rice could be entered into evidence.

Previous misbehavior can be used "to prove certain things such as intent, motive, absence of mistake, or pattern," said Anthony Barkow, who directs New York University's Center on the Administration of Criminal Law.

Another expert said that past allegations of bribery "may go to corporate culture and 'tone at the top.'"

"Practices like this as far back as the '90s undermine the argument that senior management wasn't aware," said Alexandra Wrage, the president of TRACE, an association that advises multinationals on anti-bribery compliance.

News Corp. declined comment on any of the allegations made in this article.

Piers Morgan, whose career has since taken him to a top spot as CNN's celebrity interviewer, also declined comment.

The 46-year-old's past is already under scrutiny thanks in part to suggestive statements he's made about listening in on other people's voicemails. Morgan has denied ordering anyone to hack a phone or knowingly publishing stories based on hacked information, but he was in charge at the News of the World when it was bribing people for information and freely acknowledged that the practice was wrong.

"It's a disgrace, of course, and totally unethical," he wrote. "But very handy."

[Associated Press; By RAPHAEL G. SATTER]

Raphael G. Satter can be reached at: http://twitter.com/razhael.

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