One of the Daily Telegraph's most prominent journalists resigned on Tuesday afternoon, accusing the newspaper of "a form of fraud on its readers".
Peter Oborne, the paper's chief political commentator for the last five years, claimed the newspaper regularly downplayed stories involving banking giant HSBC for fear of losing its massive advertising contract with the company. He made a series of allegations about the newspaper's advertising and sales department having influence over its editorial department.
He went on to accuse the management of hollowing out the newspaper, losing track of its core audience, and chasing online traffic at the expense of quality.
In the full article, posted on Open Democracy, Oborne makes a series of allegations about the Daily Telegraph:
Oborne says executives took the newspaper's readers for granted.
Circulation was falling fast when I joined the paper in September 2010, and I suspect this panicked the owners. Waves of sackings started, and the management made it plain that it believed the future of the British press to be digital. Murdoch MacLennan, the chief executive, invited me to lunch at the Goring Hotel near Buckingham Palace, where Telegraph executives like to do their business. I urged him not to take the newspaper itself for granted, pointing out that it still had a very healthy circulation of more than half a million. I added that our readers were loyal, that the paper was still very profitable and that the owners had no right to destroy it.
The sackings continued. A little while later I met Mr MacLennan by chance in the queue of mourners outside Margaret Thatcher's funeral and once again urged him not to take Telegraph readers for granted. He replied: "You don't know what you are fucking talking about."
He goes on to claim that the Telegraph's advertising department holds substantial influence over the editorial side of the newspaper.
With the collapse in standards has come a most sinister development. It has long been axiomatic in quality British journalism that the advertising department and editorial should be kept rigorously apart. There is a great deal of evidence that, at the Telegraph, this distinction has collapsed.
Late last year I set to work on a story about the international banking giant HSBC. Well-known British Muslims had received letters out of the blue from HSBC informing them that their accounts had been closed. No reason was given, and it was made plain that there was no possibility of appeal. "It's like having your water cut off," one victim told me.
When I submitted it for publication on the Telegraph website, I was at first told there would be no problem. When it was not published I made enquiries. I was fobbed off with excuses, then told there was a legal problem. When I asked the legal department, the lawyers were unaware of any difficulty. When I pushed the point, an executive took me aside and said that "there is a bit of an issue" with HSBC.
He says the treatment of his article on HSBC caused him to raise more concerns about the newspaper's coverage of the bank.
I researched the newspaper's coverage of HSBC. I learnt that Harry Wilson, the admirable banking correspondent of the Telegraph, had published an online story about HSBC based on a report from a Hong Kong analyst who had claimed there was a 'black hole' in the HSBC accounts. This story was swiftly removed from the Telegraph website, even though there were no legal problems. When I asked HSBC whether the bank had complained about Wilson's article, or played any role in the decision to remove it, the bank declined to comment. Mr Wilson's contemporaneous tweets referring to the story can be found here. The story itself, however, is no longer available on the website, as anybody trying to follow through the link can discover. Mr Wilson rather bravely raised this issue publicly at the 'town hall meeting' when Jason Seiken introduced himself to staff. He has since left the paper.
Then, on 4 November 2014, a number of papers reported a blow to HSBC profits as the bank set aside more than £1 billion for customer compensation and an investigation into the rigging of currency markets. This story was the city splash in the Times, Guardian and Mail, making a page lead in the Independent. I inspected the Telegraph coverage. It generated five paragraphs in total on page 5 of the business section.
And he accuses the newspaper of playing down last year's pro-democracy protests in Hong Kong, where many of HSBC's operations are based.
The paper's comment on last year's protests in Hong Kong was bizarre. One would have expected the Telegraph of all papers to have taken a keen interest and adopted a robust position. Yet (in sharp contrast to competitors like the Times) I could not find a single leader on the subject.
At the start of December the Financial Times, the Times and the Guardian all wrote powerful leaders on the refusal by the Chinese government to allow a committee of British MPs into Hong Kong. The Telegraph remained silent. I can think of few subjects which anger and concern Telegraph readers more.
On 15 September the Telegraph published a commentary by the Chinese ambassador, just before the lucrative China Watch supplement. The headline of the ambassador's article was beyond parody: 'Let's not allow Hong Kong to come between us'.
Oborne says he told Telegraph chief executive Murdoch MacLennan that he would resign on principle last year.
I expressed all of my concerns about the direction of the paper. I told him that I was not leaving to join another paper. I was resigning as a matter of conscience. Mr MacLennan agreed that advertising was allowed to affect editorial, but was unapologetic, saying that "it was not as bad as all that" and adding that there was a long history of this sort of thing at the Telegraph.
But his intention to go quietly changed when, in his eyes, the Telegraph downplayed last week's massive leak of HSBC private Swiss bank accounts.
All newspapers realised at once that this was a major event. The FT splashed on it for two days in a row, while the Times and the Mail gave it solid coverage spread over several pages.
You needed a microscope to find the Telegraph coverage: nothing on Monday, six slim paragraphs at the bottom left of page two on Tuesday, seven paragraphs deep in the business pages on Wednesday. The Telegraph's reporting only looked up when the story turned into claims that there might be questions about the tax affairs of people connected to the Labour party.
He says the newspaper deleted investigative articles from its website that cast HSBC in a negative light.
Last week I made another discovery. Three years ago the Telegraph investigations team—the same lot who carried out the superb MPs' expenses investigation—received a tip off about accounts held with HSBC in Jersey. Essentially this investigation was similar to the Panorama investigation into the Swiss banking arm of HSBC. After three months research the Telegraph resolved to publish. Six articles on this subject can now be found online, between 8 and 15 November 2012, although three are not available to view.
Thereafter no fresh reports appeared. Reporters were ordered to destroy all emails, reports and documents related to the HSBC investigation. I have now learnt, in a remarkable departure from normal practice, that at this stage lawyers for the Barclay brothers became closely involved. When I asked the Telegraph why the Barclay brothers were involved, it declined to comment.
It was allegedly part of a bid to win back the bank's advertising contract.
This was the pivotal moment. From the start of 2013 onwards stories critical of HSBC were discouraged. HSBC suspended its advertising with the Telegraph. Its account, I have been told by an extremely well informed insider, was extremely valuable. HSBC, as one former Telegraph executive told me, is "the advertiser you literally cannot afford to offend". HSBC today refused to comment when I asked whether the bank's decision to stop advertising with the Telegraph was connected in any way with the paper's investigation into the Jersey accounts.
Winning back the HSBC advertising account became an urgent priority. It was eventually restored after approximately 12 months. Executives say that Murdoch MacLennan was determined not to allow any criticism of the international bank. "He would express concern about headlines even on minor stories," says one former Telegraph journalist. "Anything that mentioned money-laundering was just banned, even though the bank was on a final warning from the US authorities. This interference was happening on an industrial scale.
In short, Oborne thinks the paper is deceiving its readers.
The Telegraph's recent coverage of HSBC amounts to a form of fraud on its readers. It has been placing what it perceives to be the interests of a major international bank above its duty to bring the news to Telegraph readers.
And he finishes with a flourish, claiming the influence of advertising over the paper's editorial department is a major scandal.
When I sent detailed questions to the Telegraph this afternoon about its connections with advertisers, the paper gave the following response. "Your questions are full of inaccuracies, and we do not therefore intend to respond to them. More generally, like any other business, we never comment on individual commercial relationships, but our policy is absolutely clear. We aim to provide all our commercial partners with a range of advertising solutions, but the distinction between advertising and our award-winning editorial operation has always been fundamental to our business. We utterly refute any allegation to the contrary."
The evidence suggests otherwise, and the consequences of the Telegraph's recent soft coverage of HSBC may have been profound. Would Her Majesty's Revenue and Customs have been much more energetic in its own recent investigations into wide-scale tax avoidance, had the Telegraph continued to hold HSBC to account after its 2012 investigation? There are great issues here. They go to the heart of our democracy, and can no longer be ignored.
The full resignation letter can be read at Open Democracy.
Jim Waterson is a politics editor for BuzzFeed News and is based in London.
Contact Jim Waterson at email@example.com.
Got a confidential tip? Submit it here.