In the second-worst News Corp. scandal of the moment, the company is accused of participating in shady deals to boost the circulation numbers of The Wall Street Journal’s European edition. Last week, the paper’s publisher Andrew Langhoff resigned for promising favorable coverage to a company that was buying huge amounts of the newspaper for as little as 1 cent per issue, but the Guardian reported that the ethical breach was only part of a larger system of deals that accounted for 41 percent of the European edition’s daily sales. The scheme was reportedly revealed to Rupert Murdoch buddy Les Hinton, a top News Corp. exec at the time, way back in the fall of 2010 by a whistle-blower, who was all of a sudden told that he was the subject of an investigation himself. A circulation manager at the company, Gert Van Mol says he realized what was going on and contacted human resources, asking to be removed from Langhoff’s team. Then came the scary meetings:
The following month Van Mol was informed that his accusations were without merit and he was fired in January 2010. He is now suing for severance pay. (Update: A Dow Jones spokesperson tells us that Van Mol was under investigation in August 2010, three months before his allegations against Langhoff.)
The policy behind News Corp.’s 24-hour hotline for employees to report internal wrongdoing states: “If you make an honest complaint in good faith, even if you are mistaken as to what you are complaining about, the company will protect you from retaliation.”*
This post has been updated with additional information.
News Corp. Ignored Wall Street Journal Aberrant Circulation Data [Bloomberg]
*This post has been corrected to show that News Corp. did not set up the hotline last week.
