The man wrongly accused of a horrific murder on Wimbledon Common 20 years ago has won substantial damages after his phone was hacked and medical records were obtained by a newspaper.

Colin Stagg is among fifty people who have accepted out of court settlement offers from the News of the World’s parent company, News Group Newspapers.

Mr Stagg, from Roehampton, sued the company after he was targeted in the early 2000s, despite being acquitted in 1994 at the Old Bailey of murdering Rachel Nickell.

The 49-year-old won a public apology and £706,000 compensation from the Home Office.

The true killer, Robert Napper, was eventually found guilty in 2008 of stabbing the young mother in front of her two-year-old son in 1992.

He said: "Justice has been done and I'm very pleased. I look on this money as part payment for all the years of vilification I suffered at the hands of the press in general.

"It's going towards a new 4x4 and some treats for my girlfriend and her family.

"And it's also sweet revenge on the NoW in particular. About eight years ago they set a honeytrap, using an exotic Asian girl to befriend me.

"We enjoyed a short relationship but I was humiliated to learn later she was a hooker employed by the paper.

"They published two pages of complete lies about my so-called deviant sex life. It was total make-belief, but at that time I had neither the money nor the reputation to fight back.”

The News of the World was shut down in 2011 by News International’s chairman, Rupert Murdoch, after it was alleged murdered schoolgirl Millie Dowler’s phone had been hacked.

Mr Stagg said his treatment by the newspaper had helped make him a “pariah” for years and hopes the settlement will be the end of his links to the Rachel Nickell affair.

He said: "The public saw me as the man who got away with the Rachel Nickell murder on a technicality.

"But now I could fight back. Since Napper's Old Bailey conviction and a fulsome police apology I've been putting my life back together.

"Hopefully this is the last chapter in the Stagg-Nickell saga and I can return to being an ordinary bloke living a quiet, harmless life below everyone's radar."