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Murdoch's Sword

Rupert Murdoch, Chairman and CEO of News Corporation, attends the Allen & Company Sun Valley Conference with his wife Wendi on July 7, 2011 in Sun Valley, Idaho.
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Rupert Murdoch, Chairman and CEO of News Corporation, attends the Allen & Company Sun Valley Conference with his wife Wendi on July 7, 2011 in Sun Valley, Idaho.

“Where does it end?”

That was the question at the heart of my conversation with Chris Kelly, former Chief Privacy Officer at Facebook, this morning on “Worldwide Exchange.” After the recent News Corp phone hacking scandal, he talked about where the alleged abuse stops, as the company is forced to amputate a few arms of its media empire.

“There's a lot of learning out there right now about how much of this really does go on,” Kelly said. As Chief Privacy Officer, he watched over a network that now includes 750 million people, and saw attempts at hacking and theft on a daily basis.

“It’s really interesting that people seem to forget there are laws that apply in these cases,” Kelly said. He pointed out that cell-phone hacking has been illegal for years, and that it includes even the small stuff, like stealing or guessing a password.

“There are a lot of countermeasures in place, but sometimes hacking happens” he said.

The blatant invasion of private information displayed by News Corp – and other recent offenders, including Facebook – has led to more stringent privacy protections, especially online, and could mean a barrage of new government regulations.

“A Foreign Corrupt Practices Act investigation here in U.S. is one road prosecutors could go down,” Kelly said, adding that congressional hearings are likely even if prosecutors don't open an investigation right away.

He also mentioned the case of journalists suspected of trying to hack into the phones of 9/11 victims: “Then you're looking at Electronic Communications Privacy Act felony violations, too.”

Whether Murdoch is falling on the proverbial sword for other media and social media companies remains to be seen. Perhaps the blood is just beginning to ooze—with shareholders and regulators finding an excuse to "remember" the laws already in place to shield against hack jobs.

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