Murdoch private eye targeted U.S. hedge fund boss

Fri May 25, 2012 1:54pm EDT

A still image from broadcast footage shows News Corporation Chief Executive and Chairman, Rupert Murdoch, speaking at the Leveson Inquiry into the culture, practices and ethics of the media, at the High Court in London April 26, 2012. REUTERS/POOL via Reuters TV

A still image from broadcast footage shows News Corporation Chief Executive and Chairman, Rupert Murdoch, speaking at the Leveson Inquiry into the culture, practices and ethics of the media, at the High Court in London April 26, 2012.

Credit: Reuters/POOL via Reuters TV

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(Reuters) - A private detective working for Rupert Murdoch's British newspapers used a legally questionable tactic to obtain a hotel bill that a New York financier ran up at one of London's swankest hotels, records reviewed by Reuters show.

A database of business records compiled by British government investigators shows that some time before his arrest in March 2003, private investigator Steve Whittamore, or someone working for him, misrepresented themselves to obtain from Claridge's Hotel a copy of a bill belonging to Robert Agostinelli, an American who runs the Rhone Group private equity firm.

Whittamore was convicted of trading in illegally obtained information but did not serve jail time. He could not be reached for comment.

Agostinelli did not respond to messages left for him at Rhone Group offices in New York and London.

He is a former senior partner at Goldman Sachs and Lazard and ranks among the richest financiers in the world.

The Whittamore database entry on Agostinelli is one of the few pieces of evidence to surface from extensive U.K. investigations that Americans were targeted by operatives working for Murdoch's British newspapers, who used questionable investigative techniques.

Murdoch's News Corp newspapers in Britain are among the principal targets of a judicial inquiry, created by British Prime Minister David Cameron and chaired by Sir Brian Leveson, a senior English judge, into the practices and ethics of the British press.

A spokesperson for News International, Murdoch's London-based newspaper publishing arm, said: "The information you refer to was the subject of a report by the Information Commissioner's Office in 2006 and has been examined extensively by the Leveson Inquiry in recent months. News International has given detailed evidence on these matters."

Allegations have surfaced that Murdoch journalists or investigators may have used similar tactics on celebrities visiting the United States, but so far those allegations relate to journalists and targets based in Britain.

An FBI investigation so far has turned up no evidence to substantiate allegations, originally made by a British newspaper which competes with Murdoch properties, that victims of the September 11, 2001, attacks on New York and Washington, D.C. may have been targeted for intrusion by Murdoch journalists or investigators.

The Whittamore database was put together by the office of Britain's Information Commissioner, a government privacy watchdog, from records seized in a police raid on the private detective's office.

The database indicates that Whittamore's inquiry regarding Agostinelli was commissioned by Murdoch's now-defunct Sunday tabloid, the News of the World. The database shows an address for Agostinelli on Fifth Avenue, New York City. It describes Whittamore's assignment as a "Claridges blag".

"Blag" is a British slang word meaning that a private detective adopts a false identity in order to con information out of a targeted organization or individual.

In the United States, blagging is known as "pretexting". According to the website of the Federal Trade Commission, pretexting is illegal under federal law if the purpose is to obtain "customer" or financial information.

In Britain, media industry sources said, blagging is usually illegal. But newspapers can defend themselves against legal complaints by asserting that the use of the practice in a specific case was in the "public interest."

The Whittamore database records show that as a result of the "Claridges blag", information was obtained about a four-day Agostinelli hotel stay, in a room which cost 411.25 British pounds per night. The total bill was 3,433.98 British pounds. The records show that the hotel stay in question was in the month of July, but do not specify a year.

Searches through media databases do not indicate that stories about Agostinelli appeared in the News of the World in the period before or soon after the police raid during which Whittamore's records were seized.

Some years later, British press articles did mention Agostinelli as a member of a group which was interested in buying the Liverpool soccer team, but ultimately lost out to another American bidder.

Agostinelli appeared as No. 19 in the 2011 edition of an annual "rich list" published by Murdoch's Sunday Times of London. The paper said Agostinelli was now "London-based", with estimated wealth of 625 million British pounds, and counted former French President Nicholas Sarkozy as a friend.

The journalist named in the Whittamore database as having commissioned the private detective to investigate Agostinelli, who now works for a different newspaper, said he had never heard of Agostinelli and maintained that the database entry referring to him was inaccurate.

A spokesman said Claridges had no comment.

The News International spokesperson added: "There is a public interest defense available for any potential breach of the Data Protection Act and you do not have the information necessary to make any judgment on specific cases. We are not in a position to comment on a specific case."

(Reporting By Mark Hosenball; Editing by Leslie Gevirtz)

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