David Cameron's chief communications officer "actively encouraged" a reporter to hack into the voice messages of celebrities in his former role as editor of News of the World, an article published by the New York Times has claimed.

The report, which is due to appear in print this Sunday in the Times' magazine, accuses Andy Coulson of imposing a "hypercompetitive ethos" which encouraged reporters to do "whatever it takes" to get a story.

Coulson has always insisted he was not aware of any phone hacking while editor of the newspaper. Downing Street said today: "Andy Coulson has repeatedly denied any knowledge of phone hacking. We have nothing further to add."

The Times story published yesterday is part of an investigation by three of its journalists in London. According to today's International Herald Tribune, the "floodgates" to details on more celebrities suspicious of hacking will be opened up in their own follow up to the report tomorrow.

The Time's article documents events from November 2005, when senior aides to the royal family began to notice problems with their mobile phone messages and, at the same time, the publication of private stories relating to Princes William and Harry.

Following an investigation by Scotland Yard, royal correspondent Clive Goodman and private investigator Glenn Mulclaire were convicted of hacking into mobile phone voicemail accounts.

But according to the Times, the evidence found during the police investigation indicates that reporters at the tabloid "might have hacked the phone messages of hundreds of celebrities, government officials and soccer stars." The evidence includes a recording of Mulcaire talking a journalist through the process of hacking of football executive Gordon Taylor's voicemail, which can be heard at NYTimes.com. Only now, the report adds, are many of the people targeted finding out.

According to the Times investigation, five people have filed lawsuits against News of the World publisher News Group Newspapers (NGN) accusing the tabloid's staff of hacking into their voicemail accounts. Further cases are reportedly being prepared. The Guardian revealed in July 2009 that NGN had paid more than £1 million to settle legal cases in relation to reporters using "criminal methods" in their work.

Based on comments from former reporters and editors at the newspaper, the New York Times report says these journalists "present a different picture of the newsroom" than that communicated by editors at the time.

"They described a frantic, sometimes degrading atmosphere in which some reporters openly pursued hacking or other improper tactics to satisfy demanding editors. Andy Coulson, the top editor at the time, had imposed a hypercompetitive ethos, even by tabloid standards. One former reporter called it a "do whatever it takes" mentality. The reporter was one of two people who said Coulson was present during discussions about phone hacking. Coulson ultimately resigned but denied any knowledge of hacking."

Most of the sources within the article remain anonymous, but one reporter, Sean Hoare, is quoted as remembering discussions with the editor about phone hacking.

"The two men first worked together at the Sun, where, Hoare said, he played tape recordings of hacked messages for Coulson. At News of the World, Hoare said he continued to inform Coulson of his pursuits. Coulson 'actively encouraged me to do it,' Hoare said."

Another reporter, Sharon Marshall, is said to have insisted it was "an industry-wide thing". Other former reporters claim phone hacking was viewed as "pervasive" at the newspaper.

"Around the newsroom, some reporters were getting stories by surreptitiously accessing phone messages, according to former editors and reporters. Often, all it took was a standard four-digit security code, like 1111 or 4444, which many users did not bother to change after buying their mobile phones. (...) A dozen former reporters said in interviews that hacking was pervasive at News of the World. "Everyone knew," one longtime reporter said. "The office cat knew."

The New York Times investigation was carried out by three journalists - Don Van Natta Jr., Jo Becker and Graham Bowley – who are understood to have been sent to London to carry out their research.

Their report accuses the Metropolitan Police of failing to follow up on other suspected cases.

"In fact, an examination based on police records, court documents and interviews with investigators and reporters shows that Britain's revered police agency failed to pursue leads suggesting that one of the country's most powerful newspapers was routinely listening in on its citizens."

But in a statement sent to Journalism.co.uk and available alongside the New York Times article, the Met claims it rejects this suggestion.

"It is the role of the police to investigate within the boundaries of the law and, where possible, produce evidence which can be presented at a criminal court. This was a complex inquiry and led to one of the first prosecutions of its kind under this legislation. It pushed the boundaries in terms of using technical evidence to secure a criminal conviction, and brought clarity to this area of law.

"(...) The MPS has a duty to ensure that any inquiries, searches, arrests etc are lawful, proportionate and involve an appropriate use of police resources, which is what happened in this case. In this case the Met has had to balance a number of competing interests, but has been as open as possible, whilst maintaining and protecting individuals' personal information and respecting privacy."

It added that no new evidence has emerged which would justify re-opening the enquiry and said the New York Times has not accurately reflected how the investigation was conducted.

A spokesperson for News of the World told Journalism.co.uk it was not commenting on the article, although the online version of the New York Times report attaches what it claims to be a response from the tabloid, in which it criticises the Times for its lack of new evidence.

"We note you have failed to provide any new evidence sufficient to support what amount to very serious allegations," the response says. "This inevitably leads us to question the motives of the New York Times.

"It seems to us that your investigation has always been tainted by a vested interest in its outcome which means it is in serious and multiple breach of your own ethical guidelines. As you should know, [the hacking issue was] examined extensively by the Culture, Media and Sport Select Committee over an eight-month period leading up to publication of its report "Press standards, privacy and libel" on 24 February this year.

"Every area addressed by your questions has already been the subject of detailed oral and/or written evidence and, in particular, put to, and answered by, our executives during public hearings conducted by the Committee".

The Times report refers to a new case, which it claims emerged earlier this year, involving a female television personality who was informed by her phone company that someone had made an "unauthorized attempt" to access her voice messages.

Following a court order the telephone company was forced to reveal the source of the call which the Times claims was traced back to a reporter from the tabloid. In the News of the World's response, it adds that it is conducting an investigation into the claims and has a "zero-tolerance approach to any wrong-doing".

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