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News International to End Phone-Hacking Victim Compensation Scheme

News of the World
Chris Ratcliffe/Bloomberg/Getty Images

The arm of Rupert Murdoch's News Corp. will shut down the program, which was launched in 2011 and has paid millions to victims.

LONDON -- News Corp.'s News International newspaper unit in the U.K. is to shut down the compensation plan it set up for News of the World newspaper phone-hacking victims.

News International, part of Rupert Murdoch's empire, said it will close down the compensation measures starting April 8, 2013, a clear indication that the former compensation scheme it set up for News of the World publisher aims to draw a line under the fallout from the phone-hacking scandal that engulfed the unit for almost two years.

News International's compensation program was announced in November 2011 as part of a move to deal with the fallout that has seen the company pay out millions of dollars in damages and legal costs to high-profile victims, including Jude Law, Steve Coogan and singer Charlotte Church.

"News Group Newspapers [the News International subsidiary that published News of the World] considers it to be in the interests of all concerned that there be clarity as to the duration of operation of the compensation scheme," the company said in a statement.

The move comes ahead of News Corp.'s plans to separate its global newspaper and book publishing business from its movie and TV interests, including 20th Century Fox and U.K. satellite broadcaster BSkyB.

On Friday, the British high court is scheduled to hear formally that at least 130 out of 167 civil claims filed last fall from individuals have settled out of court.

The vast majority of claims made against Murdoch's now-defunct Sunday tabloid relate to the period between 2000 and 2006.

With more than 1,000 "likely" victims identified by Scotland Yard and with only 238 agreed settlements, News International will continue to be vulnerable to claims even with the closure of its compensation scheme, media reports note.

In September, Sue Akers, the outgoing deputy assistant commissioner in charge of the phone-hacking inquiry at the Metropolitan police, said there were 4,700 potential phone-hacking victims.

According to News International, the compensation plan launched in April 2011, although it did not publicly announce the scheme until November 2011.