FBI espionage experts are investigating claims News Corp journalists tried to hack into the phone of 9/11 victims.
If the allegations are true Rupert Murdoch's media empire in the USA would be crippled by a massive backlash.
However, in an interview with his own newspaper the Wall Street Journal the 80-year-old Australian said he was 'getting annoyed'.
He said he would challenge the 'total lies' written about News Corp in the phone hacking scandal when gives evidence to a Commons select committee next week.
He added: “We think it's important to absolutely establish our integrity in the eyes of the public... I felt that it's best just to be as transparent as possible.”
And, astonishingly he said News Corp had handled the crisis 'extremely well' making just 'minor mistakes'.
However Peter King, a Republican congressman from New York, who spearheaded the FBI probe into the Murdoch empire said: “The thought that anyone would have hacked into the phones of those who were killed or missing or their family members at that tragic time is contemptible.”
Mr Murdoch and his son, James, finally bowed to demands to appear before the Culture, Media and Sport Committee after MPs issued summonses ordering them to appear.
They will appear alongside News International chief executive and former NOTW editor Rebekah Brooks.
The Daily Mirror reported that News Of The World journalists offered to pay a former New York police officer to retrieve the private phone records of victims of the September 11 attacks.
Meanwhile, Met Police Commissioner Sir Paul Stephenson has come under pressure to explain how Scotland Yard came to employ Neil Wallis, a former News Of The World journalist who was arrested in the phone hacking inquiry, as a PR consultant.