By Kate Holton and Georgina Prodhan
LONDON (Reuters) - News Corp did all it could to investigate a claim in 2007 that phone hacking was widespread at its News of the World tabloid before concluding there was no evidence to support it, a former human resources executive said on Tuesday.
Daniel Cloke, who was in charge of HR for News Corp's News International UK newspaper arm at the time, said that ex-royal reporter Clive Goodman's allegations had come as a complete surprise to him and to other executives.
Goodman, who went to jail for phone hacking in 2007, was long scapegoated as a "rogue" reporter acting without his editors' knowledge, until News International was forced to admit this year that the practice had been far more widespread.
Last month, a UK parliamentary committee released a letter sent by Goodman on his release from jail later in 2007 to News International executives alleging that phone hacking had been openly referred to in editorial meetings.
"At that particular moment in time, this was one employee -- ex-employee -- making allegations about others," Cloke told the committee on Tuesday, when asked why the company had not done more to uncover the scale of the phone-hacking.
"We interviewed those people, we also then looked at around 2-2,500 emails and then took it to a third party," he said. "That gave me comfort as an HR director that we had covered the bases and done the proper thing."
In the past two months, it has become clear that the hacking of phones was employed on an almost industrial scale and was used to secure stories not just about celebrities, but about also murder victims and those killed in war.
The escalating scandal has drawn in James Murdoch, who was put in charge of News International later in 2007 and signed off on a 700,000 pound ($1.1 million) payment to a hacking victim, and his father Rupert, News Corp's chief executive.
Both Murdochs testified last month to the parliamentary Culture, Media and Sport Committee on their role in the hacking affair, and James Murdoch -- until recently seen as News Corp's heir apparent -- is likely to be recalled.
Cloke and News International's ex-commercial lawyer Jon Chapman, who also appeared before the committee on Tuesday, repeatedly referred questions to Tom Crone, News International's top legal counsel, and ex-NI CEO Les Hinton.
Crone, who stopped working for the company when Murdoch took the drastic step of shutting down the 168-year-old News of the World in July, was due to testify in parliament later on Tuesday, along with the tabloid's last editor, Colin Myler.
Both have contradicted James Murdoch's previous testimony.
Cloke and Chapman, asked why the company had approved payments of a quarter of a million pounds to Goodman after he lost an appeal for unfair dismissal, presented it as simple pragmatism, not a measure calculated to buy his silence.
"It was a stark choice -- settle at a reasonable figure or end up in tribunal," Chapman said.
"At the tribunal proceedings, Mr Goodman would have been able to make a number of allegations, which we didn't believe when we had done our exercise had any foundation, but he would have been able to make those allegations in a public forum."
(Additional reporting by Paul Sandle; Editing by Rosalind Russell)