A new conspiracy uncovered by British investigators has found hundreds of potential phone-hacking victims of Rupert Murdoch's now-defunct News of the World tabloid, a victim's lawyer says.

Lawyer Hugh Tomlinson made the announcement at Britain's High Court during legal arguments related to the lawsuits against News of the World publisher News International. Tomlinson did not go into much detail, but hundreds of extra victims could translate into millions of extra damages for the UK newspaper company.

The phone hacking scandal has greatly damaged the reputation of the British tabloid press, which has been found to have hacked into the voicemails of celebrities, politicians, crime victims and others. Murdoch's company has already paid millions of pounds in settlements, and a national outcry forced British politicians to promise action to make the medial more responsible.

The revelations of new victims came only hours after British politicians announced they struck a last-minute deal over press regulation, unveiling a new code meant to curb the worst abuses of the country's scandal-tarred media.

The code follows days of heated debate over how to implement the recommendations of Lord Justice Brian Leveson, tasked with cleaning up a newspaper industry plunged into crisis by revelations of widespread phone hacking.

Victims' groups have lobbied for an independent watchdog whose powers are enshrined in law but media groups have said that threatens press freedom.

The deal struck on Monday appears to be a complicated compromise.

"I think we have got an agreement which protects the freedom of the press, that is incredibly important in a democracy, but also protects the rights of people not to have their lives turned upside down," senior opposition leader Harriet Harman told broadcaster ITV.

Unlike the UK's widely discredited Press Complaints Commission, which barely bothered to investigate allegations of phone hacking before the scandal broke, the new regulator being proposed by politicians would be independent of the media and would have the power to force newspapers to print prominent apologies.

Submitting to the regulatory regime would be optional, but media groups staying outside the system could risk substantial fines if they get stories wrong.

And rather than being established through a new press law, which advocates of Britain's media have described as unacceptable, the regulatory body would be created through a Royal Charter, a kind of executive order whose history stretches back to medieval times. Adding to the complexity, a law would be passed to prevent ministers from tweaking the system after the fact.

Harman acknowledged that the charter was "quite a sort of complex and old-fashioned thing" but said it "kind of more or less ... has got legal basis".

Victims' group Hacked Off said it was encouraged by the news of the deal but said it remained concerned about how newspaper groups would be cajoled into joining.

On Sunday, celebrities like Harry Potter author JK Rowling and actor Hugh Grant accused the government of letting down the victims of hacking. 

- AP