In a second day of testimony before the Leveson Inquiry, Rupert Murdoch admitted that “one or two strong characters” were responsible for a cover-up of the phone hacking scandal at News International.

The News Corp chairman and chief executive explained to the court that he was “misinformed” and “shielded” from events that were taking place at the paper. Murdoch pointed the finger at “a clever lawyer”, who forbade people from reporting to News International chief executive Rebekah Brooks or chairman James Murdoch.

Despite the acknowledgement of the cover-up of the “cancer” that was prevalent in News International, Murdoch stressed to the court that the senior management of News Corp were not involved. He said:

“There was no attempt, at my level, or several levels below me to cover it up. We set up inquiry after inquiry. We employed legal firm after legal firm and perhaps we relied too much on the conclusions of the police.”

He added that when presented with information relating to a Guardian article in 2009 detailing unethical practices at the News of the World, the police said that the article was wrong. He said: “We chose to take word of police over guardian. We rested on that until beginning of 2011.”

After explaining that Colin Myler was hired as the editor of News of the World in 2007 to find out “what the hell was going on” in the newsroom, Murdoch admitted that he should have taken personal responsibility for ensuring that the brief was completed, and not delegated the duty to Les Hinton.

Murdoch also described his disbelief that law firm Harbottle and Lewis did not alert Rebekah Brooks that the problem was far more widespread than one rogue reporter: “I cannot understand a law firm reading that, and not ringing the chief executive of a company and saying ‘hey, you’ve got some really big problems’.”

The media mogul told the court that he had failed with now defunct News of the World. He said: “I am guilty of not having paid enough attention to News of the World, probably the whole time we owned it. It was an omission by me, and all I can do is apologise to a lot of people.”

Describing himself as “greatly distressed” by the closure of the News of the World, Murdoch admitted that the news paper and the journalistic practices operating within it were an “aberration”.

When asked by Jay why he closed the tabloid newspaper, rather than toughing it out, Murdoch told the court he “panicked”, but said he was glad he took that decision.

Murdoch explained “when the Milly Dowler situation was first given huge publicity, all the newspapers took it as the chance to make a really national scandal. You could feel the blast coming in the window almost.”

He added: “I’m sorry I didn’t close it years before and put a Sunday Sun in,” and described the “whole business” as “a serious blot on my reputation.”

Murdoch told the court he felt in hindsight should have had a one-on-one with Clive Goodman to establish if he was telling the truth that phone hacking was more widespread in the paper. Murdoch told the court he should have “thrown all the damn lawyers out” and cross examined Goodman. He added that if he decided Goodman was telling the truth he “would have torn the place apart, and we wouldn’t be here today.”

Turning to the controversial privacy case of ex-Formula One chief Max Mosley and Neville Thurlbeck’s blackmail of women involved in the case, Jay asked Murdoch if he really felt this kind of behaviour wasn’t something to worry about.

Murdoch replied: “A journalist doing a favour for someone, and someone doing a favour back is an every day occurrence.”

Leveson told Murdoch he considered that approach “somewhat disturbing,” asking the media proprietor to tell him if he believed this type of behaviour was seen as justifiable and acceptable common practice in the industry.

Murdoch replied: “It’s a common thing in life, way beyond journalism, for people to say I’ll scratch your back if you scratch mine. This seems to go beyond that.”

Seeing an opportunity to challenge continual assurances that Murdoch did not have any inappropriate relationships with politicians, Jay suggested it was interesting that “you scratch my back” was a common attitude, but not one Murdoch held with regards to politicians.

Referring to the BSkyB bid which caused so much controversy earlier in the week, Murdoch told the court he had never met, nor dealt with Jeremy Hunt.

When asked if he and his son James had discussed the replacement of Vince Cable with Jeremy Hunt, Murdoch told the court he didn’t believe they did. Following Hunt’s appointment to the bid, Murdoch denied that James Murdoch had said “we’ve got someone better now,” but told the court “we couldn’t have had anyone worse”.

Asked by Jay if he believed the bid was derailed as a result of the revelations that the phone of murdered teenager Milly Dowler had been hacked, Murdoch said he was unsure if it was related to the “Milly Dowler misfortune” but that he did believe it was as a result of the hacking scandal.

The inquiry will continue on 7 May

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