Peter Wright, editor of the Mail on Sunday, said the newspaper 'virtually stopped' using Whittamore altogether in September 2004
In evidence to the Leveson inquiry, Wright said he first became aware of the newspaper's use of inquiry agents during the Information Commissioner's Operation Motorman investigation, which investigated the use of Steve Whittamore by the media.
Wright was asked by counsel to the inquiry Robert Jay about "the slightly unusual nature" of how payments to Whittamore were recorded along with "other incidental expenses" such as taxis, flights and hotels.
Wright told the inquiry as Whittamore was not a journalist "he fell into that category which I didn't exercise personal control over".
In his witness statement, he added that he "rebuked" the managing editor, who was said to monitor these payments, "for failing to alert me to the practice of employing inquiry agents".
Upon discovering the use of Whittamore by the newspaper in early 2004, he said it was not clear what the payments were for, and that invoices "were very vague".
"His main use to us, and the reason that our newsdesk had been keen to use him was at this point in time a lot of information that previously you had to laboriously go to places like Somerset House or to town halls where electoral rolls were kept, he had on databases," he later added.
"Which meant if you were a reporter and you were out of town on a story, bearing in mind at this point the laptops we issued didn't have internet [access], [reporters] didn't have BlackBerrys, they could ring up Whittamore and he was very good and very quick."
But he told the inquiry he "was uncomfortable that it appeared that [Whittamore] might be using methods of which we wouldn't approve, with or without knowledge of people who commissioned him".
"Early in 2004 we issued an instruction to staff that he wasn't to be used unless department heads were consulted and there was extremely good reason and other means had been exhausted."
Jay asked if there was a "risk" in this, adding that Whittamore had been arrested by this point, and later also told the inquiry Whittamore was charged in February 2004, the same month as the instruction to staff was made.
Wright said action taken by the newspaper "dated from the point at which we became aware that Whittamore was going to be prosecuted".
"It was around the turn of the year 2003/2004 and in February that year we took steps to stop the use of Whittamore or at least only use him when extremely sure what he was doing was legitimate".
Wright said he was only used "on rare occasions" after February 2004, which the inquiry later heard was the same month in which Whittamore was charged, and that his use "virtually stopped altogether in September 2004".
He said there are two payments beyond that date "which nobody can quite explain".
Wright was asked why it was not looked into whether his journalists ever asked Whittamore for illegal information, to which he said he had "to apply the rule of proportionality".
"I can only repeat that I was concerned for the good reputation and the proper function of the paper going forward.
"I was aware, by the time [the Information Commissioner's report] What Price Privacy came out [in May 2006] that appropriate authorities had conducted an investigation into this, that in two or three cases they had found evidence they thought warranted prosecutions.
"I didn't see a need to go over ground they had gone over themselves, given also we didn't have and weren't shown evidence of Whittamore's logbooks."
The Information Commissioners' second report What Price Privacy Now, published in December 2006, included a list of news outlets "identified from documentation seized during the Operation Motorman investigation" ranked based on how many "transactions" the titles were found to be involved in and how many journalists used the service.
The Daily Mail was top of this list with 952 transactions and 58 journalists, followed by the Sunday People and Daily Mirror. The Mail on Sunday was fourth, with 266 transactions and 33 journalists listed.
Wright said the newspaper accepted the ICO's overall findings.
"Overall we accepted the findings of this report. If I may say so, there was something of a learning process at this period.
"We were coming to terms with very rapidly changing technology and reporters and other writers in our newsroom were finding ways of .. adapting to technology, more rapidly than editors were aware that they were doing so.
"Rightly or wrongly it took us time to catch up with what had taken place."
In April 2007 the use of all external search agencies was banned, he confirmed.