London ( CNN ) -- Rupert Murdoch admitted Thursday there had been a `` cover-up '' of phone hacking at his flagship British tabloid newspaper and apologized for not paying more attention to a scandal that has convulsed his media empire and rocked the British political establishment . And he said that he had shut down the best-selling News of the World out of `` panic '' in the face of public fury about the revelation that a murdered teenage girl had been a victim of phone hacking . Murdoch , who owns the Sun and the Times in London , as well as controlling the Wall Street Journal , New York Post and Fox News , said his News Corp. had been a victim of the cover-up , not the perpetrator . `` Someone took charge of a cover-up , which we were victim to and I regret , '' he said at the Leveson Inquiry , an independent British probe prompted by charges of illegal eavesdropping by his newspaper . He blamed `` one or two very strong individuals '' at the paper , but did not name them . `` I also have to say that I failed , '' he said of the fact that he did not pay enough attention to the problem of phone hacking . He then paused a long time before finally continuing : `` And I am very sorry for it . '' If he had known the depth of the problem in 2007 , when a private investigator and a Murdoch journalist were sent to prison for phone hacking , he `` would have torn the place apart and we would n't be here today . But that 's hindsight , '' he said . The hacking scandal has led to dozens of arrests , two parliamentary investigations and the Leveson Inquiry , a judge-led independent probe set up by the British government . Murdoch suggested key parts of the scandal have been overblown . `` The hacking scandal was not a great national thing until the Milly Dowler disclosure , half of which has been somewhat disowned by the police , '' Murdoch said . He was referring to the revelation that people working for him had hacked into the voice mail of a missing 13-year-old who later turned out to have been murdered . The Guardian newspaper originally reported that the hackers had also deleted some of her voice mails , leading to false hopes that she was still alive and deleting them herself . In fact , the messages may have expired automatically . Murdoch Thursday described the atmosphere when news of the Milly Dowler hacking became public in July 2011 . `` You could feel the blast coming in the window . I can say it succinctly . I panicked . And I am sorry I did , '' he said of his decision to close the tabloid . He later said he should have closed it years earlier . `` This whole business is a serious blot on my reputation , '' he said . Murdoch was also grilled over his media empire 's back-channel lobbying of the British government , and said he learned of the existence of one of the key lobbyists only `` a few months ago . '' Murdoch said he was `` surprised '' at the extent of the contact by the employee , Fred Michel , with the British government as it considered a bid by News Corp. to take full ownership of British Sky Broadcasting . That bid that collapsed because of the phone-hacking scandal . `` You call it lobbying , I call it seeking of information , '' Murdoch told the Leveson Inquiry . `` I did n't see anything wrong with his activities . I was I surprised that it had gone on so long , that there were so many e-mails , yes . '' A government aide quit Wednesday over the revelation of the extent of the contacts , and there have been calls for the resignation of Culture Secretary Jeremy Hunt , who is named in the correspondence . Murdoch spent hours Wednesday downplaying his political influence , even as British Prime Minister David Cameron said politicians had been too close to Murdoch over the years and the government aide , Adam Smith , resigned over communications between the culture ministry and News Corp. Murdoch insisted Wednesday that he had `` never asked a prime minister for anything '' as he chronicled his personal relationships with prime ministers going back to Margaret Thatcher in the early 1980s . The media baron also denied using the power of his press for personal gain . At the same time , Cameron was saying politicians from across the political spectrum had been too close to Murdoch . `` I think we all , on both sides of this house , did a bit too much cozying up to Mr. Murdoch , '' he told the House of Commons as his government was battered over testimony Murdoch 's son had given to the Leveson Inquiry the day before . James Murdoch testified Tuesday that before Cameron became prime minister , he had met the politician over drinks at a pub and told him the company 's Sun newspaper would support his Conservative party in the next election . The younger Murdoch insisted that he knew little about the scale of phone hacking by people working for the News of the World , as he continued his fight to limit the damage the scandal does to him and his family 's media empire . The scandal has forced News Corp. to pay hundreds of thousands of pounds in compensation to the victims of phone hacking . James and Rupert Murdoch have been hammered over the past year about what they knew about phone hacking by people working for them . They have always denied knowing about the scale of the practice , which police say could have affected thousands of people , ranging from celebrities and politicians to crime victims and war veterans . CNN 's Dan Rivers , Erin McLaughlin , Elaine Ly and Claudia Rebaza contributed to this report .
NEW : Murdoch says he would have torn News of the World apart if he knew more in 2007 . The media baron says he closed the tabloid out of `` panic '' He denies responsibility for the cover-up of phone hacking . Murdoch says the scandal has been `` a serious blot '' on his reputation .