· Army, police 'colluded in dozens of murders'
· Report says disastrous activity prolonged conflict
· Stevens to propose overhaul of special branch
Sir John Stevens will today tell the Northern Ireland chief constable, Hugh Orde, that unprincipled collusion "ratcheted up the hatred and bitterness" between Catholics and Protestants, and that the system of recruiting and handling the agents responsible for the killings was "out of control".
His interim report on the inquiry which began by focusing on the 1989 murder of the Belfast solicitor Pat Finucane is expected to criticise the army's covert Force Research Unit.
An FRU agent, Brian Nelson, infiltrated and effectively ran the Ulster Defence Association, a loyalist terror group.
Sir John's team believes that Nelson, who died last week, was responsible for at least 30 murders, and that many of the victims he helped to identify were not involved in terrorism.
"This was absolutely appalling. It was completely out of control," a source close to Sir John said. "If you believe in the rule of law, how can you excuse what was going on? We have to ensure that this never happens again."
One of Sir John's key recommendations is likely to be the establishment of an independent intelligence oversight panel to review the records of all agents recruited by the Northern Ireland police service, the army and MI5.
"There has to be regard for the rule of law, otherwise we will descend into absolute chaos," he source said. "A lot of innocent people were killed."
One of them was Finucane, the report will say.
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