Telco giant Vodafone has admitted an employee hacked a Fairfax reporter’s phone following a story she wrote about flaws in the company’s security systems.

The company said on Saturday a lone employee had accessed “call charge records and text messages” in January 2011.

Fairfax Media journalist Natalie O’Brien had exposed a serious security risk in 2011 in the company’s data storage techniques, which reportedly meant the names, addresses and credit card details of millions of customers were available online using generic passwords.

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Internal Vodafone documents obtained by News Limited reveal the Vodafone Group’s former Australian fraud boss, Colin Yates, sent an email in 2012 outlining his concern that the hacking of O’Brien’s phone may become public knowledge.

“This could have serious consequences given it is a breach of the Australian Telecommunications Act,” Mr Yates wrote.

“And (it) would certainly destroy all of the work done by VHA (Vodafone Hutchison Australia) over the past months to try and restore their reputation.”

Vodafone immediately commissioned an investigation by a top accounting firm into the hacking, the company said in a statement.

“The investigation found there was no evidence VHA management had instructed the employee to access the messages and that VHA staff were fully aware of their legal obligations in relation to customer information,” a spokeswoman said.

The inquiry was undertaken to establish if any employee had broken privacy laws rather than to uncover the source of the Fairfax story, she said.

“As a result of our investigation, several retail staff were dismissed for breaches of VHA security policies.”

The company “strongly denied any allegations of improper behaviour”.

O’Brien, who was not aware of the incident before the publishing of internal documents by News Limited, said she was “absolutely outraged”.

“The shock and anger is only compounded knowing it was because I was doing my job that I was targeted and it was my own telco that was doing it to me,” O’Brien wrote in a Fairfax column.

“The accessing of call records and text messages without a legal basis has to stop.

“As a society we need to take a good look at this sort of behaviour and say it is unacceptable.

“Since when did telling the truth become the wrong thing to do?”

with AAP