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UK regulator clears BskyB from hacking

Thursday, September 20 12:40:42

Britain's media regulator gave pay-TV firm BSkyB a clean bill of health today, saying there was no evidence it was linked to a phone hacking scandal which engulfed Rupert Murdoch's News Corp, its largest shareholder.

However, Ofcom criticised Murdoch's son James for failing to investigate allegations of criminality at the group's newspapers properly, describing his failure to uncover the scale of the problem as "both difficult to comprehend and ill-judged".

The ruling by Ofcom, which has clashed repeatedly with BSkyB in the past, will lift a cloud that had long hung over the hugely successful group and will allow it to focus on the challenges of intensifying competition and growing economic pressures on its customers.

Ofcom concluded BSkyB was "fit and proper" to hold a broadcasting licence and avoided making the most serious ruling that News Corp should sell down some of its near 40 percent holding.

But it sharply criticised James Murdoch, a former chief executive and chairman of BSkyB who was in charge of News Corp's British newspaper arm when the scandal exploded last year at its now defunct News of the World. He stepped down as chairman of BSkyB in April in an attempt to protect the company's reputation from being damaged, but remains on the board.

"In our view, James Murdoch's conduct in relation to events at News Group Newspapers repeatedly fell short of the exercise of responsibility to be expected of him as CEO and chairman," it said. "To date (however), there is no evidence that Sky was directly or indirectly involved in any of the wrongdoing either admitted or alleged to have taken place at News of the World or The Sun." (C ) Reuters