0:04

From the news rooms of the Sydney Morning

0:06

Herald and The Age, this is the Morning

0:08

Edition. I'm. Samantha Cylinder Morris

0:11

It's Monday, April fifteenth. When

0:17

news. Broke last week that one of the

0:19

most powerful people at the Seven Network allegedly tried

0:21

to cover up and. Internal fraud investigation

0:23

The network suffered reputation of

0:25

moloch. It's just the

0:28

latest scandal that is exposed the massage

0:30

and his tic bullying and get a

0:32

story at any cost culture that has

0:34

seemingly been thriving in pockets of the

0:36

network because later today a judgment is

0:38

expected to be handed down in the

0:40

multi million dollar Bruce Lerman defamation case

0:42

which has also embroiled Seven in scandal.

0:46

But to see the issue as a

0:48

problem suffered by one media organization is

0:51

to miss the point. According to investigative

0:53

journalists, make the Kinsey who broke this

0:55

latest story today, Mackenzie, a reporter for

0:57

the last twenty one years, joints me

1:00

to discuss what happens when journalists, the

1:02

very people who are tasked with holding

1:04

the powerful to account, allegedly engage in

1:07

unethical behavior. And

1:10

just a heads up, this episode mentioned

1:12

sexual assault, self harm, and suicide. So.

1:17

Nick. The reputation of the Seven Network has

1:19

arguably been in free fall for the last

1:21

couple of weeks, ever since producers at one

1:24

of it's shows have been accused of paying

1:26

for sex and drugs to secure an interview.

1:28

And now we've got your story. So can

1:31

you start us off? Tell us who is

1:33

Bruce Mcwilliam and why is he now? Story.

1:36

Or. Bruce Mcwilliam is the

1:38

contrary to the chairman

1:40

and majority owner of

1:42

Seven. Carry. Starks. Mcwilliam.

1:45

Is a very powerful meteor executive. Prior

1:47

to serve in, he's worked. Previously.

1:50

For both Murdoch and

1:53

for. Kerry Packer, He

1:56

has a reputation as a

1:58

fearsome litigator. A fearsome. Commercial

2:00

lawyer. But what the

2:02

scandal has really exposed is

2:04

the way Make William has

2:06

managed handled been a part

2:08

of Sevens problems in a

2:10

way that's actually produced. More.

2:13

Problems for seven More Reputation

2:16

A fool, More litigation. More.

2:18

Costs. And

2:20

more trauma. At. These are

2:22

all things he was meant to

2:25

keep at bay and he leaves.

2:27

Seven is now list with a

2:29

very very second legacy. And.

2:32

It's. That conduct that really came to

2:34

the for in this most recent scandal.

2:37

And. Certainly, but this because. What you've

2:39

written is that there's a secret fraud investigation,

2:41

so can you tell me what this secret

2:44

fraud investigation was all about? This

2:46

is a scandal in two parts. Part.

2:48

One is about the Ford investigation. But.

2:51

Potteries about but quality alleged cover

2:53

up. Have. Was handled how Seven

2:55

and Mcwilliam try to keep it in house. So.

3:01

Pot One. What's this for

3:03

Investigation About Sunrise's flagship program

3:05

for seven? To

3:07

the we used to be some. Save

3:10

Writing is. Up to the

3:12

missed the miniature. And

3:16

had a very, very successful a

3:18

decade run. Under the leadership of

3:20

a guy called Michael Powell, a

3:23

storied lauded Creative Ways appointed the

3:25

idea about twenty I to run

3:27

sunrise or really a baby for

3:29

a senior executives and did extremely

3:32

well and I must say Bait

3:34

Nine. The. Owner of the I

3:36

Sydney Morning Herald. year in year out today. Lucky

3:39

to have that single breakfast

3:41

television mister Robot called. Ah,

3:43

the time that I work with is

3:46

the best team in the business and

3:48

we laugh every single day. He left

3:50

in March Twenty twenty to detect when

3:53

you go for Channel Seven in the

3:55

United States. I've new Big World with

3:57

much fanfare. Citing

4:00

you wrong here I seven Michael

4:02

else is playing with us from

4:04

liver years of for with the

4:06

show and as I'm always somebody

4:08

who was really happening behind the

4:10

scenes was he'd been the subject

4:12

of internal complained to rise by

4:14

other people at seven and what

4:16

they said was that pill and

4:18

or others at sunrise had been

4:20

using a sponsorship accounts I were

4:22

to companies quotas and a cool

4:25

hotels are giving sponsorship to Sunrise

4:27

as part of that deal that

4:29

we're giving free. Travel benefits allegation

4:31

was pale and or others at

4:33

seven and maybe even some of

4:35

their friends and everything worked at

4:37

seven. We're tapping into that account

4:39

for business class slots for luxury

4:41

combination in Beverly Hills, New York.

4:43

That must be said: this pill

4:45

denies any wrongdoing and says he

4:47

had discretion over the Why resources.

4:50

At. Sunrise is program where to be used.

4:53

And. Was working Twenty Four seven

4:55

whenever he took i free trade using

4:57

the seven Resources and not at

4:59

Arizona World even though he was on

5:01

and your life. But he says he

5:04

was working Twenty Four Seven and he

5:06

was entitled to use Thirty's resources.

5:08

And the question was was isn't a

5:10

private use a company resources and

5:12

Seven Cents That question To an extent

5:15

a law firm which in turn hired

5:17

an external from the forensic accountants to

5:19

see if basically company resources had

5:21

been misused. An investigation. Rises some serious

5:24

christians for listed company like seven, but

5:26

then pot to kicks in, which is

5:28

what I phrased earlier. The. Cover

5:30

Up. And

5:34

Bruce Mcwilliam as the Commercial Director

5:36

of Seven, makes it his business

5:38

to make sure nobody ever lens

5:41

of this investigation, this alleged fraud

5:43

investigation outside of Seven. and to

5:45

do that, He. Uses. What?

5:48

I think very clearly I'm

5:50

really inappropriate Milan tactics. He

5:52

threatens bullies reporters during their

5:54

job looking at. With. A.

5:57

Company. Resources have been misused.

5:59

He threat. Them into silence and

6:01

in the most egregious case he sends

6:03

an email to Zoe semi Os and

6:05

twenty nine year old media reporter from

6:07

the to Sydney Morning Herald now with

6:09

Israeli Financial Review see sniffing around the

6:11

story. He says to

6:13

her her conduct and looking at

6:15

this case of alleged abuse resources

6:17

this is forced Michael Pill to

6:19

self harm. He sends a very

6:22

graphic side of Michael Powell covered

6:24

in blood and says look what

6:26

you made Michael Do to get.

6:28

Zoe not to keep reporting on, have to keep

6:30

investigating the out. The problem with that is. Michael.

6:33

Pills hadn't self harmed that were using a

6:35

suicide thread. This is what Mcwilliams doing to

6:37

really bully a young reporter into silence. And

6:40

it worked. The story was was shelved in

6:42

Twenty Twenty Two, and the whole thing remained

6:44

a secret until we finally blew the lid

6:46

off most recently. And I do want to

6:49

quote from that emails. That frequently him

6:51

sent her that Journalists though he samuels

6:53

because it is. It's. Quite shocking to

6:55

read a quote he he wrote. this is

6:57

what your unfounded reports have caused. Michael's Do:

6:59

Why don't you keep it up So he

7:01

killed himself. You are complete disgrace. So. I

7:04

guess I just wanted to ask you what did you think

7:06

when you saw that? That a

7:08

now was a shocking a mouse or any

7:11

reporter to get. It was disgusting and it

7:13

was aimed at shutting down a story. The

7:15

problem. With. Mcwilliams A

7:17

know it we're was untrue. That photo

7:20

of a bloodied and bandage pale was

7:22

taken more than two weeks prior. And.

7:24

The injury was a result of pell blacking out.

7:27

On. A straight in Los Angeles. Pell.

7:30

Himself had no idea that photo had been

7:32

sent. And. Certainly had no idea

7:34

that Zoe had they blamed. The

7:37

other thing made william didn't aim

7:39

I was playing dead Be no

7:41

investigation into allegations of fraud or

7:43

corporate. Resource. Misuse at

7:45

sunrise. That was a clear falsehood.

7:48

The had been investigation. Seven.

7:50

Had called that investigation it had

7:52

been undertaken and had raised serious

7:54

questions. Why? Do we care

7:56

about this o seven to probably said

7:58

company if it. Oh, it's

8:01

star specific things. Staff are misusing

8:03

resources that belong to shareholders. That's.

8:05

An issue. But. This

8:07

case the story also rises deeper

8:09

questions about Seven Coach Up and

8:12

so what has personally him said

8:14

about what's come out in your

8:16

investigation. Into recession

8:18

and typical fashion, he's doubled down

8:20

his defended sending this photo. He's

8:22

tried to seek a retrospective approval

8:24

from Michael Powell for sending defies

8:26

are and the threats in the

8:28

aim of. The. City was simply.

8:31

Doing. His job. But. Ultimately,

8:34

Is this is how. He's. Been

8:36

doing his job. He does rise

8:39

Christians, Seven and ultimately carry starts

8:41

himself. the Chairman of seven. Because

8:46

at what point is a reasonable for somebody

8:48

a very senior executive threat like that? Now

8:50

let's not forget the express. Mcwilliam was a

8:53

key executive handling the been roberts Me to

8:55

say how the reporter that broke story about

8:57

delivered Smith happened to be a Seven

8:59

executive but our interests as reporters was in

9:02

the allegation that he was in fact a

9:04

war criminal. During. His previous special

9:06

forces service for Australia in Afghanistan will

9:08

arrive. Federal court has found that we

9:10

were right. He was a war criminal.

9:13

It was Bruce Mcwilliam. He was driving.

9:15

A legal and public rice and strategy

9:17

with some others within seven to say

9:20

that Robert Smith wasn't a war criminal

9:22

and that he was unjustly tarnished and

9:24

that day is always in the media

9:26

that has exposed him at Should Pay

9:28

That was a disaster. A strategy because

9:30

not only was found to be true

9:32

by federal court this war crimes allegations

9:34

and covered Seven in a huge amount

9:36

of reputation or damage that cost the

9:38

company a fortune and Mcwilliam is very

9:40

much part of that strategy. Will

9:47

be right back. And.

9:51

Some the it out of all of this seed. Into

9:53

the Bruce Lerman Defamation Trial

9:55

Or Judgments. That is set to be handed

9:57

down today. and there's a connection here Can

10:00

you walk us through that? It must

10:02

be said that most people at Seven are

10:04

good people. They're horrified that a small number of

10:06

people within the Seven business have done the wrong

10:08

thing and it is a small number of people. The

10:11

problem is those small number of people

10:13

had sometimes great influence.

10:16

We've seen that in the Spotlight scandal.

10:18

So what's the Spotlight, the Lerman scandal

10:20

about? Spotlight

10:22

had what many would say was

10:24

a justified story in getting an exclusive interview

10:26

with Bruce Lerman, the man accused of raping

10:28

Brittany Higgins in allegation which he denies which

10:31

is now at the centre of a defamation

10:33

action. The

10:36

night on Spotlight. Two

10:39

people going into Linda Reynolds' suite. What

10:41

happened down this corridor? What

10:44

happened behind this door? Life as I knew it was over. There

10:46

was no coming back. What

10:50

the defamation action has also produced in this

10:52

search for the truth and we don't know

10:54

where the judge will end up yet. But

10:56

it's produced revelations about the way that Spotlight,

10:59

the Seven program secured that interview. His

11:01

side of the story about what happened

11:03

when he entered a ministerial suite with

11:05

Brittany Higgins in the early hours of

11:08

Saturday the 23rd of March 2019 and

11:11

nothing is off limits. Shhh.

11:14

Bruce. It's late

11:16

in the morning. You ready? Looks

11:18

like some fights. Yeah. Now

11:21

a small number of people at Spotlight,

11:24

maybe just one or two, thought it

11:26

was okay to give Lerman

11:29

various benefits to get him

11:31

to give the interview. Now what were those benefits? We know it was $100,000 plus

11:33

in free rent. That's

11:36

a huge benefit that wasn't

11:38

properly disclosed by Seven when the interview

11:40

was given. It was really played down.

11:42

There's also been allegations that he went

11:44

and paid for sex workers and bought

11:46

cocaine and then sought to have that

11:48

reimbursed by Seven. In

11:50

return for giving the interview. This is a

11:52

mercury allegation, claimed

11:55

by at least one other in Seven,

11:57

a former Spotlight producer called Taylor A.

12:00

hour back. If the company thinks

12:02

it's okay to take a free flight over here or

12:04

pay somebody $100,000 in rent for

12:07

an interview or indeed cover

12:09

a bill for cocaine and sex workers, it

12:12

raises real questions about a company's culture

12:15

and that's what's been blowing up around 7 at the

12:17

moment. Okay, so

12:19

network 7 is possibly a toxic

12:21

place to work but I

12:23

think a lot of listeners might be asking themselves,

12:25

is any of this a surprise? Is this just

12:27

what it's like working in the media? Well,

12:30

there's been an ugly culture within media

12:32

organisations in Australia,

12:35

overseas, progressive

12:37

organisations, conservative organisations.

12:39

To be fair to 7, it's not just a 7 problem. We've

12:42

seen it at News Limited, we've

12:45

seen it at the ABC, we've

12:47

seen it at 9, which owns

12:49

this podcast and our mastheads

12:53

in the bad old days of the media. I've

12:55

been in the media for 21

12:57

years. I have never paid for

13:00

a story and never would and

13:03

that's not the culture that I've encountered but

13:06

we'd be foolish to think these things aren't

13:08

happening in all those organisations, at least in

13:10

pockets because we know it happens in all

13:12

organisations. But the critical

13:14

thing is how companies deal with

13:16

this behaviour when it does pop up. What

13:18

the whole 7 scandal really tells us is

13:20

at least in parts of 7, this is

13:23

not the way problems are dealt with. If

13:25

there's allegations of impropriety, they're not dealt with

13:27

in an accountable appropriate and modern fashion and

13:30

that's a real problem. You know though, the

13:32

good news about these scandals now flaring up,

13:34

it's going to have no choice but to

13:36

clean shop. So, media

13:38

institutions are facing significant distrust

13:41

right now. In this case, with

13:43

the 7 network shows that this is

13:45

arguably for good reason. But why

13:47

is it important to expose this? I'd

13:49

love to get your perspective on this because you've

13:52

largely focused on investigative journalism throughout your

13:54

career. The fact of

13:56

the matter is, in journalism, our job

13:59

is to hold... The. Powerful,

14:01

Institutions to account. Because.

14:04

They're using their parent our society to affect

14:06

people's everyday lives. Media organizations are amongst the

14:08

most powerful institutions in this country and endorse

14:10

you say this is a story about media

14:13

was. One commercial companies

14:15

are trying to attack at it

14:17

rival. I think I'm missing the

14:19

point. it's about. Holding us

14:22

the media to account. At

14:24

where it whereas they are exposing I

14:26

was woken i people in glass houses

14:28

conference Darn so what We We must

14:30

also ensure that sounds dirty. It's been

14:32

depressing as a reporter to write about

14:34

what's happened. a spotlight with the lumen,

14:36

expenses, It's been depressing for

14:39

myself because I look around and say

14:41

is this the media of which are

14:43

divided my working career to a was

14:45

a say about us as a profession.

14:48

More. Broadly. But I can say this

14:50

Every journalist have spoken to says the

14:52

same thing. We are as disgusted as

14:54

a public. What would not spoken about

14:56

Doris live in was also when did

14:58

you buy seven while he was facing.

15:00

Another alleged sex assault

15:03

trial. And

15:05

there were legal reasons why they couldn't have been disclosed

15:07

the time. But. Nevertheless, Seven put

15:10

on national television. Obliged.

15:13

He was professing his innocence about

15:15

allegedly writing britain Higgins while. He

15:18

was facing. Another.

15:20

Rape allegation and the very same time

15:22

he must be said, it denies buys

15:24

It must be said he's not been

15:26

found guilty of anything. But

15:29

in not disclosing that other sex assault

15:32

allegation investigations too it's audience and it

15:34

would say we couldn't those legal prohibitions

15:36

but then maybe should have not done

15:38

the interview until that could have been

15:41

disclosed. Physical problems abound with disabilities. Highly

15:44

problematic and unfortunately it reflects not just

15:46

on Spotlight, not Just and Seventy Six

15:48

Muscles. Can

16:06

A episode. Of the Morning Edition

16:08

was produced at Have a New,

16:11

the technical assistance by David Beckmann

16:13

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16:15

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16:43

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