A leading Mirror journalist allegedly blackmailed the company as it attempted to cover up phone hacking, the high court has been told. Lee Harpin, who held a number of senior roles at the People and Sunday Mirror, was alleged to be a known phone hacker whose understanding of illegal behaviour at the newspaper group caused anxiety at board level. Harpin, who is now the political editor of Jewish News, told the Guardian: “I categorically deny the allegations. No one has contacted me from either side to give evidence so I have not been given a chance to respond to these outrageous allegations.” The claims were made in a witness statement to the phone hacking trial by Brian Basham, an investor and PR executive. He told the court on Tuesday he extensively researched the Mirror’s involvement in phone hacking and shared his findings with the company’s executives and media reporters. Prince Harry and more than 100 other claimants allege there was a widespread culture of phone hacking and other illegal activity by journalists at the Daily Mirror, Sunday Mirror and the People newspapers over several decades. The court heard Basham went for lunch with David Grigson, the Mirror’s then-chairman, in 2012 and advised him to “clear the decks” on phone hacking to avoid being swept up in the same scandal as the News of the World. At that time the Mirror was still publicly insisting its journalists had not been involved in phone hacking. Basham told the court that senior staff, including board members of the listed company, were aware that voicemail interception had been widely used by its journalists. He claimed the company’s lawyers were openly making jokes about checking mobile phone messages to “widespread laughter” in the newsroom. He also alleged that the former Mirror chief executive Sly Bailey, who was in charge when phone hacking is alleged to have been at its peak, “had orchestrated a cover-up”. He said Bailey had “bullshitted her way around a lot, and that investors had been misled”. Basham said his research into the Mirror later led him to conclude the board was particularly concerned by Harpin, whom he described as “the phone-hacking ‘dauphin’, or heir apparent”. Harpin was arrested on suspicion of phone hacking while working at the Mirror in 2015 but was never charged. The Crown Prosecution Service dropped its phone hacking investigations into dozens of journalists after concluding there was “insufficient evidence to provide a realistic prospect of a conviction”. Basham alleged that, around this time, Harpin “was blackmailing the company to prevent them from penalising him for his phone-hacking activities by threatening to blow the whistle on everything he knew about their phone-hacking problem if they did”. The Mirror’s barrister suggested Basham was defaming individuals on the basis of anonymous sources. Mirror Group Newspapers has already paid out more than £100m in settlements and legal fees for phone hacking. It is fighting four test cases, including Harry’s, because it disputes their evidence. It also argues the claims have been filed too late. The court is continuing to hear evidence from witnesses in the seven-week trial, with the Duke of Sussex expected to give evidence at the start of June.