The News of the World phone-hacking scandal on Wednesday claimed its biggest scalp yet when James Murdoch, Rupert Murdoch’s heir apparent, dramatically resigned as executive chairman of News International, publisher of The Times, The Sunday Times and The Sun, amid fresh allegations that he attempted to cover-up the scandal.

Last year, its chief executive Rebekah Brooks was forced to resign over her role in hushing up the affair. She was arrested and is on bail.

Officially, the line was that Mr Murdoch (39), who joined News International five years ago, had quit to concentrate on his role as deputy chief operating officer of its parent company, the New York-based News Corporation, and play a bigger role in the company’s television business which includes Star TV and the Sky network.

In a statement, he said: “I deeply appreciate the dedication of my many talented colleagues at News International who work tirelessly to inform the public and am confident about the tremendous momentum we have achieved under the leadership of my father and Tom Mockridge (chief executive of NI).

With the successful launch of The Sun on Sunday and new business practices in place across all titles, News International is now in a strong position to build on its successes in the future.”

His father, Rupert, chairman and chief executive at News Corporation, praised “James' leadership” saying he had made “lasting contributions to the group's strategy in paid digital content and its efforts to improve and enhance governance programs."

“He has demonstrated leadership and continues to create great value at Star TV, Sky Deutschland, Sky Italia, and BSkyB. Now that he has moved to New York, James will continue to assume a variety of essential corporate leadership mandates, with particular focus on important pay-TV businesses and broader international operations,” he said.

Mr James Murdoch had been under pressure to explain how much he knew about the extent of hacking at the defunct News of the World after his own senior executives questioned his version. He was accused of misleading MPs when he appeared before a high-level parliamentary committee which inquired into the hacking row. An ongoing judicial inquiry, led by Lord Justice Brian Henry Leveson, has heard damaging allegations about the practices at his newspapers. Mr Murdoch’s resignation came a day after a senior police officer told the

Leveson inquiry that The Sun had a “culture of illegal payments” to public officials including police officers to get information. Ten current and former Sun journalists have been arrested over allegations of paying bribes.

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