Fox probe expands to second agency, report says
CNN says U.S. Postal Inspection Service joins investigation
The United States Postal Inspection Service has joined the Department of Justice in a federal probe of Fox News’ business practices and management, according to a report from CNN.
Investigators from both agencies conducted interviews in recent weeks with current and former Fox staff members, the CNN report said late Thursday, citing four unnamed sources familiar with the investigation.
The report potentially adds to parent company 21st Century Fox’s recent legal concerns. Nine months ago, Fox News CEO Roger Ailes resigned just two weeks after being sued for sexual harassment by former Fox &
Friends host Gretchen Carlson. Since then, several additional charges of sexual harassment have arisen against Ailes. And this month, Fox News dismissed star host Bill O’Reilly following an internal investigation into allegations of sexual harassment.
A spokesman for 21st Century Fox declined comment. The Justice Department and USPIS did not return requests for comment.
The investigation originally came to light in February after an attorney representing a plaintiff said federal prosecutors were investigating Fox over settlements it paid to individuals who filed sexual harassment suits against Ailes.
At that time, neither Fox nor the DOJ confirmed an investigation. However, in a statement Fox said it had been in communication with the U.S. Attorney’s office “for months” and would “continue to cooperate on all inquiries with any interested authorities.”
Subsequently, CNN confirmed Fox was the subject of an investigation, citing a person familiar with the matter. Since then, the probe may have deepened to include possible misconduct by Fox News personnel and the work environment at the network. The U.S. Postal Inspection Service might become involved because mail fraud is often included among charges in federal cases.
In February, attorney Judd Burstein said one of his clients who was suing Fox for sexual harassment had been served a subpoena as part of a criminal investigation into the allegations. Burstein had previously represented former Fox News host Andrea Tantaros, who alleged Ailes and other executives ran Fox News as “a sex-fueled, Playboy Mansion-like cult.”
At the time, Burstein said the probe could be into whether Fox might have violated federal securities law because settlement offers might not have been fully disclosed in Fox’s SEC filings.
In its first-quarter 2017 filing with the Securities & Exchange Commission, 21st Century Fox listed costs of about $35 million during the last six months of 2016 for “settlements of pending and potential litigations following ” Ailes’ resignation and a public complaint of sexual harassment allegations.
Tantaros filed her suit in August 2016, a month after Carlson sued Ailes for sexual harassment, claiming he opted not to renew her contract after she refused to sleep with him. Fox settled that case, agreeing to pay Carlson $20 million.
Ailes, who denied the allegations, left the company in July 2016 with a $40 million settlement. Fox also conducted an internal investigation.
The court granted Fox’s request to send Tantaros’ suit to arbitration. The company said she had been suspended for breach of contract by publishing a book without company approval and that Tantaros never brought up Ailes’ conduct in an internal probe of her claims.
Additional charges have been lodged against Ailes and Fox. Former Fox News host Megyn Kelly, who left the network in January for NBC, said in her book Settle
for More that Ailes had harassed her starting in 2005.