Rupert Murdoch: "Ashamed," but not responsible

Last Updated 12:37 p.m. ET

LONDON — Appearing before a House of Common committee hearing into the phone hacking scandal that has roiled his news empire, Rupert Murdoch said it was "the most humble day of my life," but denied any personal wrongdoing.

In between, Murdoch and his son, James Murdoch, faced a grilling from lawmakers about the intensifying scandal, which has spread from the family empire to the top ranks of U.K. police and even to the prime minister's office.

When MP Tom Watson asked when he had found out that "criminality was endemic at News of the World," Murdoch said, "That's a wide-ranging word."

"I was absolutely shocked, appalled, and ashamed when I heard about the Milly Dowler case only two weeks ago," he said, referring to the missing schoolgirl - later found dead - whose voice mails were intercepted and deleted by Murdoch journalists as police searched for her.

Throughout his testimony Murdoch downplayed the extent of the hacking scandal, stating that News of the World - which was his most profitable U.K. news holding - represented only 1 percent of the 53,000 Murdoch employees worldwide, and professed to have had no knowledge of payments made to victims of hacking, after two News of the World employees were jailed in 2007.

When asked if there was pressure on to get scoops which may have led to wrongdoing at News of the World, Murdoch said, "I think it was terribly wrong and [there's] no excuse for breaking law."

James Murdoch denied that the out-of-court settlements - from £60,000 to as much as £700,000 (more than $1 million) - were to buy silence, and said he was shocked to learn the company paid legal fees for a reporter found guilty of hacking.

James Murdoch said actions taken by employees at the newspaper owned by his father "do not live up to the standards our company aspires to."

MP Philip Davies asked Rupert Murdoch whether, in his conversations with newspaper editors, the matter of a payment equaling a million dollars to settle a claim against the paper might come up; he said no.

"What would you discuss with them?"

"I'd say, 'What's doing?'"

"And what sort of response would you get?"

"He might say, 'We have a great story exposing X or Y,' or he'd say, 'Well, nothing special.'"

When asked when he was first aware of the fact that employees of Murdoch papers were accused of hacking into cell phones, Rupert Murdoch replied, "I was made aware of it when they were convicted."

MP Jim Sheridan asked, "Mr. Murdoch, do you accept that ultimately you are responsible for this whole fiasco?"

"No," he said.

"You're not responsible? Who is responsible?"

"The people that I trusted to run, and then maybe the people that they trusted," he said."

Follow CBSNews.com's live blog of today's Parliamentary hearings with testimony by Rupert Murdoch, James Murdoch, Rebekah Brooks, and former London police officials Paul Stephenson and John Yates.

You can also watch the hearings live on CBSNews.com.

He said that when it came to allegations of his employees hacking, he said, "We have to find them and we have to deal with them appropriately."

Appearing frail and confused, the elder Murdoch, 80, at first seemed repentant and described his remove from the criminal surveillance being investigated. But he became increasingly flustered when committee members peppered with him questions, often turning to his son James for answers.

The chairman was asked about News International's Rebekah Brooks and Dow Jones' Les Hinton and whether they resigned because they had knowledge of phone hacking.

"I have no knowledge, and there is no evidence that I'm aware of, that Mrs. Brooks or Mr. Hinton, or any of those executives, had knowledge of that," he said. "Their assertions, certainly Mrs. Brooks and assertions to me of her knowledge of those things has been clear. Nonetheless, those resignations have been accepted. But it's important to know on the basis that there is no evidence today that I have seen or that I have any knowledge of, that there was any impropriety by them."

Among those he counted as trustworthy was Hinton, the former Executive Chairman of News International and then CEO of Dow Jones before his resignation: "I would trust him with my life," Murdoch said.

Murdoch said he ordered the 168-year-old News of the World closed because "we felt ashamed of what had happened ... We had broken our trust with our readers."

When asked if he was aware of other forms of illicit surveillance used by private investigators hired by News International, he replied, "I think all news organizations have used private detectives and do so in their investigations from time to time, I don't think illegally." When asked if he would investigate any evidence of illegal surveillance, Murdoch said, "That would be up to the police, but we would certainly work with the police. It if they wanted us to do it, we would do it."

He also said he has not seen evidence on allegations that his employees had tried to hack the phones of 9/11 victims. "As far as we know, the FBI hasn't either."

Murdoch was also asked about his dealing with British politicians, and revealed that when he was invited to 10 Downing Street the day after David Cameron's took office to be thanked for his support, he was asked by the prime minister's staff to come in the back door. "To avoid photographers in the front, I imagine. I don't know. I just did what I was told."

He said he'd also been invited to 10 Downing Street many times by Cameron's predecessor, the Liberal Party's Gordon Brown, also entering through the back door.

He also said he had never imposed preconditions on giving his newspapers' support to a politician - and that he was willing to give backing at personal cost.

"I've never guaranteed anyone the support of my newspapers," he said. "We had been supporting the Thatcher government and the conservative government that followed. We thought it got tired, and we changed and supported the Labor Party, whenever it was, 18 years ago, with the direct loss of 200,000 circulation."

As the hearing was drawing to a close, a protester with an apparent foam pie rushed Murdoch Sr., causing a scuffle and apparently striking the media baron with a pie in the face. The assailant was then struck by Wendi Deng, who jumped up to defend her husband. Police removed the man and handcuffed him. A source told the Guardian that the suspect was British comedian "Jonnie Marbles" from the protest group UK Uncut.

Minutes before the incident, Marbles tweeted: "It is a far better thing that I do now than I have ever done before #splat."

Following a brief recess, the testimony resumed in a courtroom cleared of the public and journalists. Rupert Murdoch sat without his jacket - presumably because it had been spattered.

He finished his testimony reading a written statement, which he had been prevented from reading at the start of the session:

"At no time do I remember being as sickened as when I heard what the Dowler family had to endure nor do I recall being as angry as when I was told that the News of the World could have compounded their distress. I want to thank the Dowlers for graciously giving me the opportunity to apologize in person.

"I would like all the victims of phone hacking to know how completely and deeply sorry I am. Apologizing cannot take back what has happened. Still, I want them to know the depth of my regret for the horrible invasions into their lives.

"I fully understand their ire. And I intend to work tirelessly to merit their forgiveness. ...

"The behavior that occurred [at News of the World] went against everything that I stand for. It not only betrayed our readers and me, but also the many thousands of magnificent professionals in our other divisions around the world.

"So, let me be clear in saying: invading people's privacy by listening to their voicemail is wrong. Paying police officers for information is wrong. They are inconsistent with our codes of conduct and neither has any place in any part of the company I run.

"But saying sorry is not enough. Things must be put right. No excuses."

Politicians will seek more details about the scale of criminality at Murdoch's News of the World tabloid, while the Murdochs will try to avoid incriminating themselves or doing more harm to their business without misleading Parliament, which is a crime.

CBS News correspondent Elizabeth Palmer described the atmosphere at Westminster where the hearings will take place - technically a session of the Commons' Committee on Culture, Media and Sports - as a cross between ethics, theater and an inquisition.

The star of today's drama at Westminster is media titan Rupert Murdoch, who has everything to lose, said Palmer, as investors around the world will be hanging on his every word and gesture.

Murdoch is a man used to giving orders, not answering questions - especially from politicians who, until very recently, held him in either awe or terror.

By his side will be his son James, a senior executive in the Murdoch family empire. He's known to have authorized payments to phone hacking victims on conditions they keep quiet.

After the Murdochs, the former British CEO Rebekah Brooks will face the committee.

As editor of the News of the World newspaper when the hacking was taking place, Brooks was a hands-on manager.

"Rebekah Brooks knows where all the bodies are buried," political columnist Will Hutton told CBS News. "She knows the rights and wrongs of all these questions, she knows who knew what about what payments when. She knows everything."

Brooks may not say very much today because she was arrested over the weekend, and though out on bail now will be acutely aware she's involved in a criminal inquiry.

Speaking to the committee this morning, the departing head of London's police force Sir Paul Stephenson said it is "embarrassing" that a former editor of News of the World worked for a time as a PR consultant for the Metropolitan Police, now that the scale of the phone hacking scandal involving Rupert Murdoch's newspaper is now known.

Stephenson said he had "no reason to connect Wallis with phone hacking" when he was hired for the part-time job in 2009. He also revealed that 10 of 45 press officers for the force are former employees of Murdoch's News International.

Also appearing before the House of Commons committee, Assistant Police Chief John Yates (who resigned his position Monday) disputed that he had conducted due diligence on Wallis' background at the time of his hiring, as others have suggested.

He also said he was not responsible for making a hiring decision on Wallis' daughter, saying he acted merely as "a post box for CVs."

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In spite of the Murdochs' frantic sometimes attempt over the last couple of weeks to control the damage from this scandal, it's already wiped nearly a billion dollars off the value of the family holdings, said Palmer.

"Look, there is a situation where their share prices seem to be diving," Alastair Campbell, a former government Director of Communications, told CBS News. "A lot of questions are being raised about leadership in the company, and James Murdoch is chief executive. Those questions are going to be in the minds of a lot of people who have financial interest in News Corp. today."

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Lawmakers are also holding a separate hearing to question London police about reports that police took bribes from journalists to provide inside information for tabloid scoops and why the force decided to shut down an earlier phone hacking probe after charging only two people.

Detectives reopened the case earlier this year and are looking at a potential 3,700 victims.

The London police force said Tuesday it had asked watchdog to investigate its head of public affairs over the scandal — the fifth senior police official being investigated. The force asked the Independent Police Complaints Commission to look at Dick Fedorcio's role in hiring a former News of the World executive as an adviser to the police.

Fedorcio was questioned by lawmakers Tuesday, along with Stephenson and Yates, who both resigned over allegations of too-close ties to Murdoch journalists.

"I think," Fedorcio said of the Yard's hiring decisions, "with hindsight a lot of things would have been done differently,"

2nd top U.K. police official resigns amid scandal

But it's the appearance by the Murdochs and Brooks that is drawing a level of interest that is unheard of for a Parliamentary committee, whose work usually goes little noticed.

Members of the public and journalists lined up hours ahead of time in hope of a spot in the small committee room, which holds about 40 people. More will be able to watch in an overspill room, and Britain's TV news channels are anticipating high ratings for the appearance.

Prime Minister David Cameron cut short a visit to Africa and is expected to return to Britain for an emergency session Wednesday of Parliament on the scandal.

In a further twist, a former News of the World reporter Sean Hoare who helped blow the whistle on the scandal was found dead Monday in his home. Police said the death was "unexplained" but is not being treated as suspicious. A post-mortem was being conducted Tuesday. Hoare was in his late forties.

Murdoch phone hacking whistleblower found dead

Brooks' spokesman, David Wilson, said police had been handed a bag containing a laptop and papers that belong to her husband, former racehorse trainer Charlie Brooks. Wilson said the bag did not contain anything related to the phone hacking scandal and he expected police to return it soon.

The bag was found dumped in an underground parking lot near the couple's home on Monday, but it was unclear how exactly it got there. Wilson said Tuesday that a friend of Charlie Brooks had meant to drop the bag off, but he would say only he left it in the "wrong place."