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LONDON (Reuters) - Britain's top police chief resigned and the former head of Rupert Murdoch's UK newspaper business was arrested on Sunday over a phone-hacking scandal that is lapping at Prime Minister David Cameron's door.
Analysts said the gathering pace of heads rolling had turned up the heat on Cameron and Murdoch over their handling of the scandal, with the media tycoon due to be questioned by parliament in a possible showdown on Tuesday.
Paul Stephenson, London's police commissioner, quit in the face of allegations that police officers had accepted money from Murdoch's News of the World paper and not done enough to investigate hacking charges that surfaced as far back as 2005.
The trigger for his resignation was revelations he had stayed at a luxury spa at which Neil Wallis, a former News of the World deputy editor, was a public relations adviser. Wallis, also employed by police as a consultant, was arrested last week in connection with the hacking scandal.
"I had no knowledge of the extent of this disgraceful practice (of phone-hacking)," Stephenson said in a televised statement, referring to allegations that thousands of phones, including that of a murdered schoolgirl, had been hacked into.
Stephenson's resignation and the arrest of Rebekah Brooks, one of Murdoch's top lieutenants until last week, were the latest twists in a scandal that has tainted police and politicians and shaken the tycoon's global media empire.
Several sources familiar with the situation said Brooks, 43, was being questioned as part of an investigation into allegations of illegal voicemail interception and police bribery at the News of the World tabloid she once edited.
Brooks quit on Friday as chief executive of News International, the British unit of Murdoch's News Corp, but has denied she knew of the alleged widespread nature of the phone-hacking.
The scandal has shocked the public and raised concerns not only about unethical media practices but about the influence Murdoch has wielded over British leaders and allegations of cozy relationships between some of his journalists and police.
With politicians from Australia to the United States demanding to know if similar abuses occurred elsewhere in Murdoch's global media business, the 80-year-old has been forced on the defensive and the position of his son James as heir-apparent has been called into question.
Murdoch was forced to drop a $12 billion plan to buy all of highly profitable broadcaster BSkyB.
Cameron has come under fire for his friendship with Brooks and for employing former News of the World editor Andy Coulson as his press secretary after Coulson quit the paper in 2007 following the jailing of a reporter for phone-hacking.
Tim Bale, politics professor at the University of Sussex, said: "It has become almost a crisis of governance in the United Kingdom. (Stephenson's) resignation takes us beyond a few bad apples ... There is a sense of things sliding out of control.
"The actual text of (Stephenson's) statement pointing to parallels between himself and the prime minister is quite breathtaking. It won't make Mr Cameron do the same thing, but it reminds people once again of the Coulson problem."
Wyn Grant, professor of politics at Warwick University, said: "I don't think this is a crisis that is going to bring down the government.
"Clearly Cameron has made errors of judgment in this whole matter, and he is going to suffer some reputational damage, but there is nothing he has done that has been revealed so far that would require him to stand down."
Underlining Cameron's discomfort, opposition Labor Party leader Ed Miliband -- previously largely unable to score points off the prime minister -- has made the running on the scandal, analysts said.
Brooks and Rupert and James Murdoch are due to be questioned by parliament on Tuesday, including over reports that News International misled legislators during earlier hearings.
But Brooks' spokesman said her arrest might cast doubt on whether she could appear before politicians.
"Anything that will be said at the select committee hearing could have implications for the police inquiry," said David Wilson, adding Brooks was "shocked" by the arrest.
The flame-haired Brooks became the focus of widespread anger over the phone-hacking scandal but was initially protected by Murdoch, who guided her rise through the male-dominated world of UK tabloid journalism to become editor of the News of the World in 2000 and the Sun's first female editor in 2003.
Flying into London a week ago to take charge of the crisis, Murdoch appeared before journalists with his arm around her. Asked what was his first priority, he gestured at her and replied: "This one."
Known for her networking skills, Brooks rose quickly through the ranks of tabloid journalists, combining a tough demeanor that could intimidate hardened "hacks" with an ability to charm largely male editors.
But her initial refusal to quit, and a faltering speech she delivered when she closed the News of the World and ended the careers of dozens of colleagues, prompted some journalists to say she was out of touch.
In 2003, Brooks said the News of the World had made payments to police in the past but could not remember any specific examples.
The News of the World, which published its final edition a week ago, is alleged to have hacked up to 4,000 phones including that of murdered 13-year-old Milly Dowler, sparking a furor that forced Murdoch to close the paper.
Murdoch, who some media commentators say at first misjudged the strength of public anger, published apologies in several British newspapers at the weekend.
He lost another loyal executive on Friday when Les Hinton, another former head of his UK newspaper business, resigned as chief executive of Murdoch's Dow Jones & Co which publishes The Wall Street Journal.
"There are no excuses and should be no place to hide ... We will continue to cooperate fully and actively with the Metropolitan Police Service," News International said in statement on Sunday.
Leading British politicians renewed calls for greater media plurality and press regulation -- a direct threat to Murdoch's empire, which includes The Sun, The Times and Sunday Times broadsheets, and 39 percent of BSkyB.
The Sunday Telegraph reported that members of the board of BSkyB, where James Murdoch serves as chairman, were due to meet in a special session on July 28 to discuss his future.
If James were to be felled by the scandal, British media speculated that his sister Elisabeth could secure the eventual succession to their father.
Additional reporting by Keith Weir and Georgina Prodhan, Writing by Ralph Gowling; Editing by Jon Boyle