News of the World closure and shredding records

The following appeared on the’s live coverage of the News of the World closure (link here);


Owen Bowcott has been looking into claims from the media lawyer Mark Stephens that the News of the World closure might enable a liquidator to shred a backlog of potentially incriminating emails and documents.

“Why would the liquidator want to keep [the records]?” Stephens told the news service Reuters. “Minimizing liability is the liquidator’s job.”

But the London insolvency practitioner Rodney Hylton-Potts dismissed the idea as legally implausible. “In a liquidation, a liquidator takes over all the books and records but that does not affect the obligations of a liquidator or a director to bear in mind any criminal inquiry,” he said.

“The leading case in this is Enron, where the accountants, Arthur Anderson, sent around an email saying that they should shred things. They were severely criticised for that and it finished the [accountancy] firm.

“We know there are police inquiries going on into the News of the World and anybody who removed records now would be personally liable. It would be perverting the course of justice and a crime. I don’t think liquidation will make any difference [to the firms records].

“Indeed, the News of the World policy since January has been to cooperate with the police and in a solvent liquidation [like the NoW], the liquidator has a duty to follow the company’s policy.”


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