CBC -- The family members of British soldiers killed in Iraq and Afghanistan may have also had their phones hacked by a U.K. tabloid, according to a report.
The Daily Telegraph reported that the personal details of the families of servicemen who died on the front line have been found in the files of Glenn Mulcaire, the private detective working for News of the World.
The latest allegation comes as British Prime Minister David Cameron told the House of Commons Wednesday that his government favours an inquiry -- or several inquiries -- into the newspaper phone-hacking scandal that has shocked Britons.
Revelations of illegal activity at a popular British tabloid newspaper are again dominating British politics after new allegations emerged that the tabloid News of the World hacked the phone messages of a missing girl who was later found murdered.
"We do need to have an inquiry, possibly inquiries, into what has happened," Cameron told MPs during question period.
"We are no longer talking here about politicians and celebrities, we are talking about murder victims, potentially terrorist victims, having their phones hacked into."
There were allegations this week that a private detective employed by the Rupert Murdoch-owned tabloid obtained telephone numbers of relatives of people killed in the bombing attack on London subway trains and a bus in 2005.
The BBC, meanwhile, reported that detectives had obtained evidence that the newspaper had illegally paid police officers for information.
British media also reported that the parents of Holly Wells and Jessica Chapman, schoolgirls murdered in a sensational 2002 case, had been informed by police that they were investigating whether the News of the World also hacked their telephones.
Milly Dowler, 13, was found murdered months after her phone voicemail was hacked, and the report that her messages were tampered with has horrified Britons.
Major advertisers have pulled their ads from the News of the World, or are reviewing their positions, including carmaker Ford UK, retail banker The Co-operative Group, Halifax (Lloyds banking group), Vauxhall, and Richard Branson's Virgin Holidays. Others such as EasyJet and Marks & Spencer have issued statements criticizing the newspaper's conduct.
British readers are used to seeing their tabloid papers harass royals, sports stars and celebrities, constantly eavesdropping and paying even the most tangential sources for information about stars' sex lives and drug problems.
The latest hacking case, however, has been met with revulsion from everyone from Cameron to movie stars to people who commented on Twitter.
"[It is] shocking that someone could do this, knowing that the police were trying to find this person and trying to find out what had happened," Cameron said earlier while on a trip to Afghanistan.
The case has also drawn new attention to Rupert Murdoch's global media empire as Murdoch is trying to engineer the politically sensitive, multibillion-dollar takeover of broadcaster BSkyB in Britain.
Britain's Culture Secretary, Jeremy Hunt, has insisted he will decide the issue purely on competition grounds, without regard to the behaviour of the News of the World, but some members of Parliament are linking the two issues and demanding that Hunt block a takeover.
Milly's disappearance in 2002 while walking home from school in Surrey, south of London, transfixed Britain until her decomposing body was found six months later in the woods by mushroom pickers.
While police were pursuing all leads, and Milly's parents were making dramatic appeals for information, a private investigator working for the News of the World allegedly hacked into her cellphone, listened to her messages and even deleted some to make room for possible new ones.
Mark Lewis, a lawyer representing Milly's parents, said Tuesday the suspected hacking may have hampered the police investigation and he plans to sue the tabloid for its interference.
It was never determined how long the teen was alive after being abducted, but the tabloid's actions reportedly came soon after her disappearance. Police realized some messages had been deleted, giving them and Milly's parents false hope that she was still alive.
"It is distress heaped upon tragedy to learn that the News of the World had no humanity at such a terrible time," Lewis said. "The fact that they were prepared to act in such a heinous way that could have jeopardized the police investigation and give them false hope is despicable."
He said executives at the newspaper should take responsibility and step down.
Serial killer Levi Bellfield was convicted of Milly's slaying two weeks ago. He was already serving a life sentence for two other murders.
Private investigator apologizes
Cameron condemned the grotesque press intrusion and called for an immediate inquiry. .
Glenn Mulcaire, a private investigator who earlier served prison time for helping the tabloid hack into cellphones, apologized Tuesday for any interference with police inquiries.
In a statement in the Guardian newspaper, he said he knew he "pushed the limits ethically" and said he was sorry to all who had been "hurt or upset" by his activity.
"Working for the News of the World was never easy," Mulcaire said. "There was relentless pressure. There was a constant demand for results."
Mulcaire and reporter Clive Goodman were jailed in 2007 for hacking into the phone messages of palace officials.
Pressure mounted Tuesday for the resignation of Rebekah Brooks, editor of the tabloid at the time of the alleged hacking and now a top Murdoch executive in the U.K.
There were also signs of a developing boycott, with Ford UK announcing it was pulling ads from the News of the World. Grocery chain Tesco and Virgin Media both said they were considering withdrawing ads as well.
Prominent Britons have railed against the tabloid.
"Newspapers were using phone hacking on a widespread and industrial basis ... [with] the apparent collusion of parts of the Metropolitan Police," actor Hugh Grant told BBC radio.
Grant said successive British governments have "winked" at the illegal practice, because they needed Murdoch's support to get elected.
Ed Miliband, leader of the opposition Labour Party, said he was "horrified that the grieving parents of an abducted child were made to go through further torture that somehow she was alive because her voice mails were being retrieved or deleted." Miliband called the events "a stain" on British journalism.
Brooks, a Murdoch confidante, refused to step down, telling her staff in an email Tuesday that she had no knowledge of the alleged hacking.
"We were all appalled and shocked when we heard about these allegations," Brooks wrote. "I am sickened that these events are alleged to have happened. Not just because I was editor of the News of the World at the time, but if the accusations are true, the devastating effect on Milly Dowler's family is unforgivable."
She said she had written to the girl's parents promising to fully co-operate with investigators.
Murdoch said the allegations of phone hacking were "deploarable and unacceptable" but added his support for Brooks.
"I have made clear that our company must fully and proactively co-operate with the police in all investigations and that is exactly what News International has been doing and will continue to do under Rebekah Brooks's leadership.
"We are committed to addressing these issues fully and have taken a number of important steps to prevent them from happening again."
Britain has stricter privacy laws than the U.S., and in recent years judges have granted dozens of public figures gag orders to prevent media from publishing the details of their private lives.
But those gag orders have come under increasing criticism and are becoming obsolete. Last month, Twitter users "outed" soccer star Ryan Giggs as the celebrity who was granted an injunction preventing media from publishing allegations that he'd had an affair with a reality television contestant.
New allegations surfacing
New hacking allegations involving another murder case surfaced Tuesday when a lawyer representing a man named Colin Stagg told The Associated Press that police believe Stagg's phone had been hacked by the News of the World in 2000.
Police had claimed Stagg was linked to a 1992 murder but he was acquitted after a judge criticized the way police had gathered evidence against him. Lawyer Alex Tribick said police told him the investigation had turned up documents indicating that Stagg's phone had been hacked.
After years of denials, the News of the World has admitted to hacking into the cellphone voice mails of many celebrities and sports stars and offered cash settlements to some victims. Two people have served time for their roles in the case, and five more people have been arrested since a fresh police investigation began in January.
The paper also faces dozens of lawsuits stemming from the illegal hacking.
Former Deputy Prime Minister John Prescott and actor Jude Law are among those believed to have been hacked by the tabloid, which has already reached a $160,000 cash settlement with actress Sienna Miller, Law's former girlfriend.
Jo Caddis, a furniture dealer in North London, said she was disgusted by the new allegations.
"The parents saw that messages had been deleted and got hope when there was no hope," she said. "You should not be allowed to hack into any phone, it's a complete breach of rights, but to do it in a case where a girl is missing is terrible."
With files from CBC News