Former No 10 spin doctor Andy Coulson is found guilty of conspiring to hack phones while he was editor of the News of the World, but ex-colleague Rebekah Brooks is cleared.
Coulson, who was forced to resign as Prime Minister David Cameron’s director of communications over the scandal, now faces the possibility of jail following the high-profile trial at the Old Bailey.
He took on the No 10 spin operation when Mr Cameron entered Downing Street in 2010, resigning shortly before being arrested over phone hacking.
Following the verdict, the prime minister said he was “extremely sorry” to have employed Andy Coulson.
Mr Cameron told the Commons in 2011 that if it transpired that Coulson “knew about the hacking at the News of the World, he will not only have lied to me, but he will have lied to the police, to a select committee, to the Press Complaints Commission and, of course, perjured himself in a court of law”.
Chancellor George Osborne has echoed Mr Cameron’s apology, saying: “We gave him [Andy Coulson] a second chance but, knowing what we now know, it’s clear that we made the wrong decision.”
Following Coulson's conviction, Rupert Murdoch's British newspaper operation said it had changed the way it did business "to help ensure wrongdoing like this does not occur again". A News UK spokesman said: "We said long ago, and repeat today, that wrongdoing occurred, and we apologised for it. We have been paying compensation to those affected and have cooperated with investigations."
But the jury of eight women and three men cleared ex-News International (NI) chief executive Rebekah Brooks of all charges.
Her husband Charlie Brooks, ex-NI head of security Mark Hanna and Ms Brooks’ former PA Cheryl Carter were also acquitted of perverting the course of justice.
Stuart Kuttner, ex-managing editor of the now-defunct NoW, was also cleared.
Ms Brooks was overcome by emotion on hearing the verdicts and was taken away by the court matron.
The jury, which has been considering verdicts since 11 June, is still looking at further charges against Coulson and former NoW royal editor Clive Goodman of conspiring to commit misconduct in a public office by paying police officers for two royal directories.
Coulson, 46, of Charing, Kent, had denied all the charges against him, as has Mr Goodman, 56, of Addlestone, Surrey.
Ms Brooks, 46, was cleared of hacking, misconduct in a public office for allegedly signing off payments to a Sun journalist’s “number one military contact” between 2004 and 2012, conspiracy to pervert the course of justice and perverting the course of justice.
Ms Carter, 50, of Chelmsford, Essex, was cleared of perverting the course of justice by removing seven boxes from the NI archive just days before she was arrested in 2011.
Racehorse trainer Charlie Brooks, 52, of Churchill, Oxfordshire, and Mr Hanna, 51, were cleared of perverting the course of justice around the time of police searches in July 2011.