News International bosses fell victim to a "cover-up" over the hacking scandal, Rupert Murdoch has told the Leveson Inquiry into press standards.
The media mogul said senior executives were not informed, or misinformed, and "shielded" from what was going on.
"I blame one or two people for that, who perhaps I shouldn't name because for all I know they may be arrested yet," he said.
"But there is no question in my mind that maybe even the editor, but certainly behind that, someone took charge of a cover-up which we were victim to and I regret."
Asked by counsel to the inquiry Robert Jay QC where the "cover-up" emanated from, the tycoon replied: "I think from within the News of the World. There were one or two very strong characters there who I think had been there many, many years and were friends of the journalists.
"The person I am thinking of was a friend of the journalists, drinking pal, and was a clever lawyer and forbade them to go and see the evidence, or there have been statements reporting that this person forbade people to go and report to Mrs Brooks or James (Murdoch). That is not to excuse it on our behalf at all, I take it extremely seriously that that situation had arisen."
"I have to admit that some newspapers are closer to my heart than others but I also have to say that I failed. And I am very sorry about it."
Mr Murdoch said he had not paid enough attention to the News of the World, probably "throughout all the time that we have owned it".
"I was more interested in the excitement of building a new newspaper and doing other things," he said. "All I can do is apologise to a lot of people, including all the innocent people in the News of the World who lost their jobs as a result of that."