News Corp To No Longer Pay Hacker's Legal Fees

News Corporation has terminated "with immediate effect" the payment of legal fees for a private investigator who was jailed over phone hacking, Sky News' City editor Mark Kleinman has exclusively revealed.

Earlier the chairman Rupert Murdoch sent an email to employees, saying he was "shocked and appalled" by the claims surrounding the now-closed News Of The World (NOTW).

In a hearing before the Commons Culture Select Committee on Tuesday Mr Murdoch and his son James said they had been "very surprised" to discover the company was funding Glenn Mulcaire's fees.

Mr Mulcaire was convicted and jailed in 2007 over royal phone taps, along with royal reporter Clive Goodman.

It came as News Corp's second biggest shareholder, Saudi Arabia's Prince Alwaleed, insisted the company remained a valuable investment.

In a statement on Wednesday, News International (NI) said: "News Corporation's Management and Standards Committee met this morning and has decided to terminate any arrangement to pay the legal fees of Glenn Mulcaire with immediate effect.

"The MSC is authorised to cooperate fully with all relevant investigations and inquiries on the News Of The World phone hacking case, police payments and all other related issues across NIl, as well as conducting its own enquiries where appropriate."

In the email Rupert Murdoch told his NI staff "those who betrayed our trust must be held accountable" in the wake of the phone-hacking scandal.

On Tuesday Mr Murdoch said appearing before the committee was the most "humble" day of his career.

In the email, he wrote that he wanted "to apologise, reiterate the company's co-operation with the police and explain what we are doing to resolve these issues".

Mr Murdoch added: "I was shocked and appalled by recent allegations concerning the News of the World and I am deeply sorry for the hurt that was caused. And we have taken responsibility."

"I have led this company for more than 50 years and have always imbued it with an audacious spirit."

"But I have never tolerated the kind of behaviour that has been described over these past few weeks. It has no place at News Corporation.

"These serious allegations made about some of our former employees at the News of the World directly contravene our codes of conduct and do not reflect the actions and beliefs of our many employees."

He said it was "a great company that has set the pace and created much loved journalism, television and film for six decades and we will continue to do so for years to come.

"In regard to the issues at News International, the company had created an independent management and standards committee to determine new standards that would be clearly communicated and consistently enforced, and would continue to co-operate fully with the authorities wherever the investigations led.

"Those who have betrayed our trust must be held accountable under the law. We also welcome and will co-operate with parliamentary and judicial inquiries."