Fed Investigating Ailes And Fox News Channel For Hiding Harassment Payouts

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Overshadowed in coverage by the last election, the sexual harassment case against Roger Ailes of Fox News appeared not to get much media time. However, the allegations against Ailes are still in full swing as a number of reporters working for Fox News have allegedly either decided to jump ship or have been paid off to keep their stories out of the limelight. At least, that is what the ongoing criminal investigation has been employed to find out.

Fox News Channel, a Rupert Murdoch company, has had allegations levied against them that the company hid the details and payouts of sexual harassment suits from their investors in order to save face. The claims are that the company paid people off to not press charges, but failed to tell their shareholders, or anyone who holds a monetary stake in the company, about the financial arrangements.

Judd Burnstein, an attorney who represents Fox News host Andrea Tantaros, insists that  many “under the table” deals were made. Many other clients have been subpoenaed to tell their story in front of a grand jury to determine whether there is enough evidence to follow the case forward. The ex-chairman Roger Ailes is the one who is on trial, but so too is an entire network of executives who made the decision to keep things quiet.

Burnstein commented that he had heard there was an ongoing investigation related to the allegations of sexual harassment. Although some of the most prominent figures like Gretchen Carlson refused to be paid off and have been vocal and might seek legal advice, Bernstein alleges that she was just the tip of the iceberg. He believes that many cases were sunk by secret deals and backhanded payoffs.

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It’s not just a matter of money; there are criminal allegations in the works. Burnstein maintains that the office has subpoenas issued.  There is also a securities unit looking into the investigation to see if there was impropriety by Fox News dealing in settlements without letting shareholders know about the allegations and how they were being dealt with, as an attempt to keep their stocks high.

In a cloak of secrecy, even Burnstein has not named those who have been subpoenaed to the grand jury to sort through the details. The lawyer defending Fox News insists that the investigation has no merit and is nothing short of a witch-hunt.

Burnstein’s allegations are that the payouts made to female employees who claimed sexual harassment are not recorded in Fox’s Securities and Exchange Commission filings, and that it is potentially a violation of federal law, which can result in criminal charges. The real question in this case is not whether deals were made to save Ailes’ reputation and potentially Fox News’ stock, but whether there was an obligation for those payouts to be made public, or at a minimum disclosed to Fox News’ investors.

If the answer is “yes,” then Murdoch’s company has been in violation of the law.  And it doesn’t just involve securities or sexual harassment suits; this also crosses into the realm of employment law and class action. With so many different legal questions, it is difficult to figure out what, if any, and how many laws have been violated and what is punishable.

If Ailes did not tell the shareholders about the payouts, then are they really liable to pay for his crimes, or for the payouts to those who made allegations of sexual harassment against the chairman? Is it the investor’s responsibility to take financial losses for the potentially criminal acts of the company they invest in?

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Burnstein insists that he was first made aware of the potential impropriety when the case that he brought before Fox News began in arbitration instead of court. Wondering how many other suits had been brought and settled before his, he knew that such a high-profile claim could not have been the first to be denied its day in court. What is for sure is that there are several sexual harassment cases levied against Ailes. How many? No one knows. But a grand jury is about to find out and rule whether or not it was legal to keep those payoffs from investors.

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Student @ Advanced Digital Sciences Center, Singapore. Travelled to 30+ countries, passion for basketball.