Hacking officers and the 'champagne links' to Wapping

Senior Met figures questioned at Leveson Inquiry over close ties to NOTW – and why they decided to drop investigation

Two senior Scotland Yard officers who dismissed the true scale of phone hacking at the News of the World had a close relationship with some of its journalists who were later arrested for alleged crimes at the paper, the Leveson Inquiry heard yesterday.

John Yates, the Met's former assistant commissioner, had eight meetings with Neil Wallis, the paper's deputy editor until 2009, between 2009 and 2010, six while he was looking into alleged phone hacking at Mr Wallis's former paper – none of which was declared in the Metropolitan Police's register of hospitality. Mr Yates also had several meetings with NOTW crime editor, Lucy Panton.

Andy Hayman, the assistant commissioner with oversight of the hacking inquiry in 2006, Operation Caryatid, which prosecuted only the paper's royal editor and its private investigator despite much wider evidence of wrongdoing, also had evening engagements with Mr Wallis and Ms Panton.

After the Met launched fresh investigations into the paper, detectives arrested Mr Wallis in July 2011 on suspicion of phone hacking and Ms Panton in December 2011 on suspicion of police corruption.

In a day of evidence highlighting the intimate professional and personal connections between senior Met staff and Rupert Murdoch's tabloid, the inquiry disclosed the meetings from notes they had made in their Scotland Yard diaries.

The inquiry asked Mr Yates about an email sent by the NOTW's news editor James Mellor to Ms Panton, the crime editor, on 30 October 2010, asking her to find out more from him about a bomb found in a printer cartridge on a cargo aircraft. Mr Mellor wrote: "John Yates could be crucial here. Have you spoken to him? Really need an excl [exclusive] splash [front page] line so time to call in all those bottles of champagne..."

Robert Jay, QC, the Leveson Inquiry's counsel, was particularly interested in meetings between Mr Wallis and Mr Yates, who in July 2009 decided not to reopen Scotland Yard's investigation into phone hacking after spending several hours reviewing the progress of the investigation carried out three years earlier. His diary showed a close connection to Mr Wallis.

On 3 June 2009, for instance, he had a "private appointment" with Mr Wallis, the property developer Nick Candy and the PR entrepreneur Noel Redding at an Italian restaurant in London. In September 2009 – while Mr Yates was beginning to look afresh at the hacking inquiry following new disclosures in The New York Times – he again met Mr Wallis (who had by then left the paper) at the Mayfair restaurant Scotts. Among many other meetings with the NOTW's staff, Mr Yates had dinner with its editor, Colin Myler, and Ms Panton at the Ivy Club, private rooms above the famous theatreland restaurant in London, on 5 November 2009.

Giving evidence by video link from Bahrain, where is he helping organise its police force, Mr Yates said Mr Wallis was "certainly a good friend" and had not declared the meals and drinks because they were "private engagements" for which he sometimes footed the bill.

He added that he could not have known at the time that Mr Wallis, the deputy editor of the paper in 2006 at the time its royal editor, Clive Goodman, was arrested for phone hacking, would later become a suspect.

Mr Goodman and the NOTW's private investigator Glenn Mulcaire were jailed in January 2007 for intercepting the voicemails of a total of eight people – whereas police now suspect other NOTW staff were involved and that the total number of victims will be 829.

The inquiry produced minutes of a briefing from Scotland Yard on 9 July 2009, which indicated that Mr Yates may not have been told about the full scale of the evidence seized by police from Mr Mulcaire in 2006. One sentence read: "No evidence to support wider phones had been intercepted."

Mr Yates denied that he had "been plied with champagne by Lucy Panton", but agreed he had drunk champagne with her. Mr Hayman, who was the senior counter-terrorism officer in 2006, dined with Ms Panton on 8 November 2005 and met her again at Scotland Yard on 11 November that year. He said he knew few details about Operation Caryatid.

Sun's defence editor is arrested

The defence editor of 'The Sun' has been arrested on suspicion of paying public officials for information.

Virginia Wheeler, 32, appeared at a south London police station by appointment to answer questions related to evidence sent by News Corporation's management standards committee to Scotland Yard.

'Sun' publisher News International confirmed Ms Wheeler had been arrested in an email sent to its staff.

A Metropolitan Police spokesman later confirmed a 32-year-old woman had been bailed to a date in May.

Ms Wheeler had been abroad on extended leave. Police are understood to have wanted to question her for several weeks. Her arrest in connection with Operation Elveden follows those of 10 other former or current employees at 'The Sun'.

Ian Burrell

Murdoch briefed on terror by Met

Scotland Yard chiefs briefed Rupert Murdoch on terrorist operations, the inquiry was told yesterday. Peter Clarke, who headed the force's counter-terror division, told the Leveson Inquiry there was "scepticism" in the media that the capital was a target before the 7 July attacks in 2005.

He said he met Mr Murdoch when he was briefing senior journalists at News International's Wapping headquarters in August 2004.

NOTW reporter denies MP's claims

'News of the World' reporter, Alex Marunchak, who was accused by the Labour MP Tom Watson of knowing a murdered private detective was about to sell a story on police corruption shortly before he was killed in 1987, has dismissed the claims as an "Oscar ceremony" performance. Mr Maranchuk said he had never heard of Daniel Morgan, or his employers, Southern Investigations, under after his murder.

Leveson: I will stop more leaks

Lord Justice Leveson has criticised leaks from his inquiry, which may include the revelation that Scotland Yard loaned a horse to former News International chief executive Rebekah Brooks.

He warned yesterday that he could restrict advance release of witness statements to core participants if the leaks continue.

The leaks would constitute a breach of confidentiality and could disrupt the inquiry, he said.

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