British hacking scandal widens with Brown, royal claims

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Britain's phone hacking scandal spiralled on Monday amid reports that former premier Gordon Brown and the royals were targeted, as the government dealt a blow to Rupert Murdoch's bid for pay-TV giant BSkyB.

In a story taking new twists and turns by the hour and shaking the entire establishment, Brown was told by police that he may have been targeted by The Sunday Times and The Sun, both stablemates of Murdoch's doomed News of the World tabloid.

"Gordon Brown has now been informed of the scale of intrusion into his family's life," a spokesman for the former leader said Monday.

"The family has been shocked by the level of criminality and the unethical means by which personal details have been obtained. The matter is in police hands," he added.

Police told Brown that private investigator Glenn Mulcaire, who was working for News International, hacked his phone and accessed his personal bank account when he was finance minister.

The royal family were meanwhile allegedly targeted by the News of the World, Britain's biggest selling weekly newspaper, which Murdoch shut down at the weekend amid allegations of widespread illegal phone hacking.

With the rot threatening to spread to other parts of Murdoch's empire, News International, Murdoch's British newspaper wing, issued a brief statement asking for information about the claims relating to Brown.

"We note the allegations made today concerning the reporting of matters relating to Gordon Brown. So that we can investigate these matters further, we ask that all information concerning these allegations is provided to us," it said.

But the damage to Australian-born Murdoch's News Corporation continued as current Prime Minister David Cameron's government announced that Murdoch's bid to take over BSkyB would be referred to Britain's competition commission.

Culture Secretary Jeremy Hunt told parliament that he had taken the decision after Murdoch's News Corporation withdrew its earlier offer to spin off Sky News from the deal as a concession.

"The events of last week shocked the nation," Hunt said, referring to a frantic period which began one week ago with claims that the News of the World hacked the phone of a young murder victim, and ended with the paper's demise.

He said the decision would take at least six months.

Scotland Yard, which is leading inquiries into phone hacking and allegations of corruption at the tabloid, joined the fray with an unusual statement Monday condemning the reports as part of a "deliberate" attempt to undermine the probe.

It said they had agreed in meetings with News International and their lawyers to keep certain information confidential.

"We are extremely concerned and disappointed that the continuous release of selected information -- that is only known by a small number of people -- could have a significant impact on the corruption investigation," Scotland Yard said.

The statement referred to reports by the BBC and other media that an internal News International inquiry found emails that included requests by a News of the World reporter for money to pay royal protection police for phone numbers belonging to the royal family.

Murdoch is currently in London to take personal charge of dealing with the furore that forced the closure of the populist News of the World, but the 80-year-old mogul kept a low profile on Monday.

BSkyB shares plunged 7.6 percent on Monday, slumping to 693 pence from 750 pence at the close on Friday. They later recovered slightly to 705 pence, a drop of six percent.

Cameron urged Murdoch to deal with the hacking crisis instead of focusing on his bid to acquire the remaining 61 percent of BSkyB, which the government had been set to decide on.

"If I was running that company right now, with all of the problems and the difficulties and the mess, frankly, that there is, I think they should be focused on clearing those up rather than on the next corporate move," Cameron said.

But Cameron is himself under pressure after police on Friday arrested Andy Coulson, a former News of the World editor who was Cameron's media chief until he quit in January over the phone hacking allegations and claims of corruption.

"At no stage did anyone give me any information that showed that he knew about the phone hacking," Cameron said.

Cameron is also close to Rebekah Brooks, the chief executive of News International. Reports that she would be questioned by police this week have not been confirmed.

The News of the World had been dogged by allegations of voicemail hacking for years. A royal reporter and a private investigator were jailed in 2007 and Coulson resigned.

The News of the World published its final edition on Sunday after 168 years with the headline "Thank You and Goodbye".