Neville Thurlbeck: 'Erosion of trust in the product' threatens the SunCredit: Yui Mok/PA
According to Bloomberg, later in the interview Thurlbeck added that Murdoch's "ultimate goal" was to stop the investigations at the Sun and News of the World from "infecting" the rest of the company.
"It's a gradual erosion of trust in the product, which is what we experienced at the News of the World. That can be fatal. Eventually, suddenly, you reach that tipping point and you're over the cliff. That's what Murdoch will fear about his American assets. That's his biggest fear at the moment I would have thought. His ultimate goal at the moment is to protect them."
"What I am told is the police investigation into the Sun is involving things like £50 lunches with police officers. This is being dragged up during interview. People's expenses sheets. Lunch with officers."
"You know, if journalists are going to be arrested at dawn and dragged out of their beds and have their houses searched and the floorboards pulled up for having lunches with officers and if they are then going to be suspended or fired or prosecuted because of it, well every newspaper in Fleet Street might as well close up shop now because every newspaper on Fleet Street worth its salt at some point in its career will be taking a police officer, the more senior the better, out for lunch to get information."
According to Bloomberg Thurlbeck added: "There's huge anger. Remember, before the arrests, on the Sun newsroom floor, there was huge pride - I can't tell you how proud those journalists are to be working for the Sun newspaper. I know journalists that left the Sun 15 years ago, and they still say how proud they were to work for that paper."
Five Sun journalists were arrested at the weekend as part of the Metropolitan police investigation into alleged payments to police and public officials. None of them were charged and they have all been released on police bail.
The outcome of the investigation could have repercussions on News Corp's US business, because of America's Foreign Corrupt Practices Act, which means that company management can be prosecuted in the States for wrongdoing overseas.
Rupert Murdoch's biographer, Michael Wolff, who now writes for the Guardian, called yesterday for the Sun to be sold and for the proceeds to fund the Times and Sunday Times.Virtually the entire American operation has had it with the Brits. There's no upside that they can seeMichael Wolff
He told the BBC's Newsnight that the consensus within News Corporation in the US was that the brand was "poisoned and it will not be rehabilitated".
Wolff said: "What's going on inside this company is that virtually the entire American operation has had it with the Brits. There's no upside that they can see - everybody but Rupert can see - in maintaining the British operation here."
He added: "Their approach now is to say let it all out, let these guys sink or swim on the basis of their own performance and their own behaviour. The company itself is turning over evidence which the police are acting on. That would indicate to me that things are probably pretty bad - you have the company and the police on the same page."
He also suggested that Murdoch was no longer in charge of what happened, "not the way he has been in charge for the 60 years he has run this company".
Wolff said: "The pressures on him in the US are enormous, greater than they have ever been and there are personalities within the company that are nearly as strong as Rupert at this point. I think he cannot defend his sentimental love [of The Sun newspaper] any more."