Six months after shutting down News of the World in a failed attempt to blunt the howls of outrage growing over tabloid phone hacking in Britain, News International agreed on Thursday to pay out more than $1-million to 17 hacking victims, including actor Jude Law and his ex-wife, Sadie Frost, the former deputy prime minister, John Prescott, and the son of the U.K.’s most notorious serial killer.

Beyond the financial hit, the settlements raise questions that could further damage News Group Newspapers, the British newspaper division of Rupert Murdoch’s media empire, including the strongest allegations yet that its board directed staff to destroy evidence of hacking.

“News Group has agreed to compensation being assessed on the basis that senior employees and directors of NGN knew about the wrongdoing and sought to conceal it by deliberately deceiving investigators and destroying evidence,” read a statement issued by Bindmans, the law firm for many of the victims who settled. News Group said it was merely adopting that position for the purpose of resolving the matter. But during the High Court proceedings, a lawyer for the company stood and offered a formal apology after each settlement statement was read into the record.

The mogul’s son, James Murdoch, was a member of the News Group board until he stepped down last September. He remains chairman of News International, which publishes the Sun tabloid, the Times, and the Sunday Times.

The settlements may also re-energize the efforts of the U.S. Justice Department, which has been looking into allegations that News International hacked the phones of Sept. 11 victims. On Thursday, Mr. Law repeated his allegation, made last year, that his phone had been hacked when he was at New York’s JFK airport. The company has never publicly responded to allegations of foul play on U.S. soil.

Another 19 settlements were announced without any details beyond the names of the plaintiffs, who include Princess Diana’s former lover, James Hewitt, the former MP George Galloway, model Abi Titmuss and the singer Dannii Minogue.

Mr. Law followed up the proceedings with a statement claiming he had achieved his goal in bringing legal action. “For several years leading up to 2006, I was suspicious about how information concerning my private life was coming out in the press. I changed my phones, I had my house swept for bugs but still the information kept being published. I started to become distrustful of people close to me,” he said.

“I was truly appalled by what I was shown by the police and by what my lawyers have discovered. It is clear that I, along with many others, was kept under constant surveillance for a number of years.”

The full facts of that surveillance only became clear to many of the claimants over the past six months, even if much of the bad behaviour had occurred years before. News International had insisted for years that a single “rogue reporter” (assisted by a private investigator) had engaged in hacking. But after numerous damning reports by the British newspaper The Guardian and The New York Times (which were given a tip of the hat by Bindmans on Thursday), authorities reopened their investigations.

The resulting inquiries have rocked British society, uncovering corruption at the Metropolitan Police and leading to the arrests of at least 20 individuals so far, including Rebekah Brooks, the former head of News International, who stepped down from her position at the company less than a week after shutting News of the World last July. Andy Coulson, editor of News of the World from 2003 to 2007, was forced to resign from his position as head of communications for Prime Minister David Cameron last January as the scandal erupted. He was later arrested, though not charged.

The investigations also showed up the toothless regulatory framework in which the British press operates. This week Alan Rusbridger, editor of The Guardian, told a government inquiry into press practices that a hacking investigation conducted by the Press Complaints Commission watchdog had been, “worse than a whitewash.” In fact, the PCP had initially slapped The Guardian for its dogged reporting on the hacking, before that paper managed to break the scandal wide open.

In the past couple of weeks, prominent members of the British press have acknowledged the need for new regulations and effective complaints bodies.

The months-long inquiry, led by Lord Justice Brian Leveson, is expected to hear from Prime Minister Cameron after the election in May.

While Thursday’s settlements remove the bulk of plaintiffs in a trial set to begin Feb. 13, a dozen others have so far refused to settle, including singer Charlotte Church and the actor Steve Coogan.