Rebekah Brooks WILL appear before MPs after nine hours of interviews with the police following her arrest



Her solicitor says decision to arrest her causing 'enormous reputational damage'



Crunch BSkyB board meeting in 10 days times



Dowler family lawyer says timing of the arrest 'stinks'

The Metropolitan Police put no allegations to Rebekah Brooks during nine hours of interviews, her solicitor said today as he described the decision to arrest her as causing 'enormous reputational damage'.



Mrs Brooks, 43, a confidante of Tony Blair, Gordon Brown and David Cameron, was until last week the most powerful woman in British newspapers.



She was editor of the News of the World when murdered schoolgirl Milly Dowler’s phone messages are alleged to have been hacked.

Her arrest, when she arrived at a London police station for a prearranged interview, came amid growing pressure on James Murdoch, heir apparent to his father Rupert’s troubled media empire.

Rebekah Brooks (pictured with Rupert Murdoch eight days ago) was arrested yesterday over allegations of phone hacking and police corruption Reflective: Mr Murdoch leaves his house in Central London this morning. Alongside him are copies of the Wall Street Journal and the Daily Mail. Tomorrow, he and his son James will appear before the Parliamentary select committee for Culture, Media and Sport Wendi Murdoch, Rupert's wife, arriving at the media mogul's Central London home this morning

PRESSURE MOUNTS ON JAMES MURDOCH AHEAD OF CRUNCH BOARD MEETING

James Murdoch’s position as heir to father Rupert’s News Corp media empire looked increasingly precarious last night following the arrest of Rebekah Brooks, ex-head of the News International publishing arm.

Pressure is mounting on the directors of BSkyB to either support or sack Murdoch junior (pictured), who chairs the pay-TV company part owned by News Corp.

A crunch board meeting on July 28 could decide his future as James is already under fire from the phone hacking scandal and collapse of News Corp’s bid to buy up the 61pc of shares in BSkyB it does not already own.

Last week investment firm Yacktman said it would be ‘thrilled’ if News Corp president Chase Carey took over the conglomerate, in a clear snub to James.

His sister Elisabeth Murdoch could yet land a senior role at News Corp as the family scrambles to preserve Rupert Murdoch’s dream of a media dynasty. She is set to join the board in October after News Corp bought her TV company Shine.

News Corp shares have shed more than £1.3bn of their value in the past ten days on fears the fallout from the phone hacking scandal

will infect other parts of the Murdoch organisation.

The group has announced a £3bn share buy-back in an effort to assuage worried investors and prop up the share price. Meanwhile, London-listed BSkyB stock has fallen from a high of 850p to just 709p on Friday.

Terry Smith, head of broker Tullett Prebon and chief executive of Fundsmith, made a scathing attack on News Corp and urged Rupert Murdoch to end his reign as head of the company.

Labelling News Corp as the ‘Temple of Doom’, Smith said Murdoch was no longer suitable to run the beleaguered media giant.

He will be in the firing line over 'hush money' payments he sanctioned to alleged victims of phone hacking by the tabloid. The deals included gagging clauses which appear to have prevented victims discussing potential criminal activity.

On July 7th he sent out an email to staff outlining why the News of the World had to close. Part of it read: 'The paper made statements to Parliament without being in the full possession of the facts. This was wrong.



'The company paid out-of-court settlements approved by me. I now know that I did not have a complete picture when I did so. This was wrong and is a matter of serious regret.'



Stephen Parkinson, of Kingsley Napley, said Mrs Brooks, the former News International chief executive, was also not shown any documents connecting her to any crime during questioning yesterday.



It was earlier confirmed Mrs Brooks will definitely appear before a committee of MPs tomorrow to answer questions about the phone-hacking affair despite her arrest.



Mr Parkinson said: 'The position of Rebekah Brooks can be simply stated: She is not guilty of any criminal offence.



'The position of the Metropolitan Police is less easy to understand. Despite arresting her yesterday and conducting an interview process lasting nine hours, they put no allegations to her, and showed her no documents connecting her with any crime.



'They will in due course have to give an account of their actions, and in particular their decision to arrest her, with the enormous reputational damage that this has involved.



'In the meantime, Mrs Brooks has an appointment with the Culture, Media and Sport Select Committee tomorrow. She remains willing to attend and to answer questions.



'It is a matter for Parliament to decide what issues to put to her and whether her appointment should take place at a later date.'



The 43-year-old was arrested by Scotland Yard and bailed after being questioned for several hours yesterday.



The development led to speculation that she would not appear before the committee tomorrow, when she faces tough questions from MPs, alongside Rupert Murdoch and his son James.



The Met declined to respond.



News International chief executive Mrs Brooks – regarded by Rupert Murdoch as a ‘fifth daughter’ – announced her departure from his empire on Friday morning.



She insists she had no idea at that stage that she was about to be arrested. Her spokesman initially said her arrest would make her planned appearance alongside Rupert and James Murdoch at the Commons tomorrow ‘pretty tricky’.



He added that she had been offering to speak to police since January, and so was ‘very surprised’ to learn she was being arrested.



Mark Lewis, lawyer for the Dowler family, said the timing of the arrest ‘stinks’. He declared: ‘To be arrested two days before a committee at which she was going to be at one time the only person from News Corp giving evidence looks deliberate.’



Liberal Democrat MP Adrian Sanders, a member of the committee due to question Mrs Brooks and the Murdochs tomorrow, said: ‘A lot of people are going to think this is very, very odd.



‘If this is designed to take the spotlight off the police at the same time as giving a shield to Rebekah Brooks, that’s a very serious matter indeed.

‘We don’t know how much this is going to impede our questioning until we’ve been able to sit down and talk it through with the Parliamentary counsel.’



Labour justice spokesman Chris Bryant, an alleged phone hacking victim, said: ‘I think this is rather odd timing, to happen on a Sunday and just two days before her appearance.



‘Maybe the police are trying to protect evidence, but plenty of people will be saying, “This is an opportunity for her to get out of saying things to the culture committee”.’

It also emerged today that Press Association reporter Laura Elston, who was arrested last month by police investigating allegations of phone hacking by journalists, will face no further action, her lawyer said today.

Laura Elston was detained for several hours on June 27 when she voluntarily attended an appointment at a central London police station.



Scotland Yard said she was questioned on suspicion of intercepting communications, contrary to Section 1 of the Regulation of Investigatory Powers Act (RIPA) 2000.

But today her solicitor David Corker was informed that she faced 'no further action'. He added: 'She has been dropped from the inquiry.'



Putting it right: News International used full page adverts in national newspapers to explain what it plans to do in response to the phone hacking allegations