"All I can do is apologize," said Rupert Murdoch as he conceded he could have done more to stop the hacking scandal that has engulfed his News Corp. media empire and destroyed so many careers.

It has been a fascinating morning at Britain's media ethics inquiry with  Murdoch claiming that he and his son were the victims of a cover-up about the extent of phone hacking at their now-shuttered London tabloid the News of the World.

But he also pleaded ignorance.

"The senior executives were all misinformed, and shielded from anything that was going on there," he told the inquiry. "I do blame one or two people for who perhaps I shouldn't name, because for all I know they may be arrested yet. But there's no question in my mind that maybe even the editor, but certainly beyond that, someone took charge of a cover-up, which we were victim to and I regret."

Although he wouldn't say who the two are he referred to a "clever lawyer" who was friends with journalists connected to the hacking.

"This person forbade them to go to [News International chief executive] Mrs. [Rebekah] Brooks or [Murdoch's son] James," he testified.

There was a flash of anger at commission counsel James Jay, who said the media company's response to phone hacking scandal showed a "desire to cover up not expose." Murdoch shot back - "perhaps to people with with minds like yours" - but then said, "I take that back," and reached out his hand to Jay.

He went on to offer contrition.

"I am guilty of not paying enough attention to what was going on at the News of the World," he said.  "All I can do is apologize to a lot of people - including all the innocent people at the News of the World who lost their jobs."

Tough questioning followed from inquiry chair Lord Justice Leveson about whether Murdoch "really did try to understand what was going on, or you felt you didn't really feel the need to understand what was going on, it's over, move on?"

Murdoch: "I have to admit that some newspapers are closer to my heart. I also have to say that I failed. And I am very sorry about it."