From left, Bob, Sally and Gemma Dowler, the surviving relatives of a phone hacking victim Milly Dowler, are in settlement talks.

Story highlights

NEW: A possible settlement would total 3 million pounds (US $4.7 million)

The settlement would go to the family of a murdered teenaged girl and to charity

Revelations that journalists hacked into her phone while she was missing sparked outrage

The hacking scandal has led to arrests of News International officials

London CNN  — 

The publisher of the former News of the World newspaper is negotiating a settlement that would pay 2 million pounds (U.S. $3.1 million) to the family of a murdered U.K. teenager after journalists at the paper hacked into the girl’s voice mail when she went missing, a company source told CNN on Monday.

In addition, media mogul Rupert Murdoch, who heads the parent company of News International, would personally pay another 1 million pounds (U.S. $1.6 million) to charity as part of the settlement under discussion, according to the News International source who declined to be named discussing internal corporate business.

No details about the charity were immediately available.

Earlier, a News International statement confirmed it was involved in “advanced negotiations with the Dowler family regarding their compensation settlement.”

Milly Dowler, 13, disappeared in 2002 and was later found dead.

Revelations surfaced in July that journalists working for the News of the World at the time of her disappearance had eavesdropped on Milly’s phone, deleting some of her messages to make room for more. The deletion of messages gave the family hope she was still alive when she was already dead.

Public and political outrage in Britain was immediate and intense, and less than a week after the reports surfaced, News International chief executive James Murdoch ordered the closing of News of the World, a best-selling Sunday paper. James Murdoch is the son of Rupert Murdoch.

Previously, News of the World apologized for hacking into the voice mails of celebrities and politicians, paying compensation to actress Sienna Miller and offering money to others. An out-of-court settlement of 700,000 pounds (U.S. $1.2 million) was paid to English soccer executive Gordon Taylor for “illegal voice mail interception.”