New evidence in the News Corp. phone hacking scandal reveals a widespread cover-up that casts doubt on sworn testimonies from the company's most senior leadership. A 4-year-old letter written by former News of the World reporter Clive Goodman but published Tuesday claims that phone hacking was "widely discussed" at the tabloid and conducted with "the full knowledge and support" of the tabloid's senior management. The fresh revelation spells trouble for former Dow Jones chief Les Hinton, former News of the World editor Andy Coulson, Prime Minister David Cameron, and Rupert Murdoch. But it's potentially explosive for James Murdoch, who now faces another set of allegations that he lied to Parliament.

The Parliamentary committee investigating phone hacking allegations describes the Goodman letter as "absolutely devastating." Based on the context in which it was written in March 2007--just after Goodman's release from a four-month-long, phone-hacking-related prison sentence--the letter implicates each of the above News Corp. leaders in a slightly different way.

James Murdoch - The News Corp. chief operating officer is "likely" to be recalled to testify before Parliament says Labour MP Tom Watson. The Goodman letter led to an internal investigation at News Corp. that was conducted by the law firm Harbottle & Lewis. The new evidence seems to support the view that this investigation was more like a massive cover-up operation that Murdoch knew more about than he said he did. Last month, James Murdoch testified that he approved a $1.6 million settlement to a footballer without knowledge of an email that contained direct evidence of News of the World journalists hacking the footballer's phone. News International lawyer Tom Crone and former editor Colin Myler said that Murdoch's testimony was "mistaken." The Goodman letter and other documents released Tuesday further support Crone and Myler's claim. In a letter to Parliament, James has defended his testimony and said that he had no knowledge of the condemning email at the time of the settlement.

Rupert Murdoch - Like his son, the News Corp. chief faces new accusations that he misled Parliament in his July testimony. The evidence provided by Harbottle & Lewis claims that News Corp. hired them not to investigate Goodman's claims thoroughly, but rather to provide the guise of an investigation in order to insulate the company from further scrutiny. Nick Davies at The Guardian reports:

Harbottle and Lewis say they find it "hard to credit" James Murdoch's repeated claim that News International "rested on" their letter as part of their grounds for believing that Clive Goodman was a "rogue reporter". They say News International's view of their role is "self-serving" and that Rupert Murdoch's claim that they were hired "to find out what the hell was going on" was "inaccurate and misleading", although they add that he may have been confused or misinformed about their role.

Regardless of whether he was confused or not, Parliament will likely ask Murdoch to explain the law firm's accusations. 

Les Hinton - The Goodman letter was an appeal to the leadership of News International not to fire the former royal correspondent for gross misconduct. At that point in time, Hinton was in charge of News International and had been copied on the letter. Parliament now wants to know why Hinton did not take the condemning letter to the police. Labour MP Tom Watson said on Tuesday:

Let me be clear, if what Goodman says is accurate, then it's very, very serious for Andy Coulson and Tom Crone the lawyer. If it's not accurate, the central question is why did Les Hinton, the Chief Executive of News International at the time, on receiving this letter not mention it to a Parliamentary inquiry that he gave evidence to only days afterwards and why did he not immediately call in the police? After all there had been an allegation of widespread criminality in the organisation in 2007 and he didn't want to clear it up. That contradicts what Rupert Murdoch told us which is he takes a zero tolerance policy to wrongdoing in News Corp.

Andy Coulson - The Goodman letter directly accuses Coulson, then editor of News of the World, of broader phone hacking knowledge. Goodman claims that Coulson had promised him his job back after the prison sentence in exchange for his silence. Davies reports:

Goodman claims that phone hacking was "widely discussed" at editorial meetings at the paper until Coulson himself banned further references to it; that Coulson offered to let him keep his job if he agreed not to implicate the paper in hacking when he came to court; and that his own hacking was carried out with "the full knowledge and support" of other senior journalists, whom he named.

Coulson later became the press secretary for Prime Minister David Cameron who--like everyone implicated--at best faces further embarrassment from the set of accusations.