A police informer claims he killed lawyer in his home

Immediately after the verbal confession, which was secretly taped but not made under caution, McIlwrath and Johnston Brown, the other CID officer who had heard it, wanted to pursue a murder investigation against Barrett.

McIlwrath says he and Brown wanted to obtain more evidence from Barrett and then confront him under caution.However, the detectives were instructed by the Special Branch to steer away from the subject of Finucane during subsequent meetings with Barrett, who became a police agent.

The Special Branch told the two CID officers that there was nothing new in the confession.

When an investigation into the handling of the Finucane case was launched later, the tape of Barrett's confession, made by the Special Branch officer, could not be found.

Later Barrett, who went into hiding shortly before Christmas and is now living under an assumed name, denied any involvement in the killing when he was formally interviewed by police. Last week he could not be contacted at an address where he stayed recently.

These new disclosures about the affair add to allegations of a cover-up and to calls for a full public inquiry into Finucane's murder. They compound accusations that some elements of the British security forces were prepared to tolerate or even to assist with the murder of republicans by loyalists.

The Sunday Times has previously revealed how a highly secretive army unit called the Force Research Unit (FRU) had close connections with loyalist paramilitaries who attacked republicans. Some activists involved in crimes were agents of the FRU, which has now been disbanded.

One agent, Brian Nelson, was an intelligence officer for the loyalist Ulster Defence Association (UDA); he helped it to target Finucane.

When an independent inquiry led by Sir John Stevens, now commissioner of the Metropolitan police, began to investigate whether British security forces had colluded with loyalist terrorists, the FRU burgled and burnt the offices of Stevens's detectives.

A military intelligence "covert methods of entry team" attempted to destroy records and protect Nelson from prosecution. However, he was later jailed for terrorist offences.

There has always been suspicion of official involvement in singling out Finucane, who was seen by loyalists as an IRA sympathiser because he had successfully defended republicans.

The way the murder and its aftermath unfolded even touched the ministerial levels of Margaret Thatcher's government. In January 1989, Douglas Hogg, then a Home Officer minister, said in the Commons: "I have to state as a fact, but with great regret, that there are in Northern Ireland a number of solicitors who are unduly sympathetic to the cause of the IRA."

He had made his comment after being briefed on the subject by Sir John Hermon, the then chief constable of the RUC, who said later that he was furious with Hogg for disclosing the information.

Three weeks later, on February 12, Finucane was enjoying Sunday dinner with his wife and three children when two masked men called at his house in Belfast. He was shot 14 times.The murder, following Hogg's comment, sparked a diplomatic crisis as loyalist paramilitaries claimed responsibility but the perpetrators remained at large.

In October 1991, Barrett, a leading member of the UDA, met the three plain clothes police officers in a car. A heavy gambler, he had offered to give them information in return for money and a new life.

McIlwrath and Brown were in the car along with a Special Branch officer who had a secret tape recorder. No cautions were given to Barrett. or warnings about self-incrimination.

What happened next is only now becoming clear, although The Sunday Times first revealed the possible existence of a taped confession in October 2000. At that time only sketchy information could be published for fear of prejudicing the trial of anyone who may have been charged with the murder.

Since then, the police have publicly said they see little prospect of anyone ever being prosecuted for the killing and more details of the detectives' meeting with Barrett have emerged.

Sitting in the front of the car were Brown and the Special Branch officer; McIlwrath and Barrett were in the back.

At one point Barrett was asked who had killed Finucane. "He replied, 'Hypothetically, I f* done it,'" said McIlwrath last week.

Barrett told the detectives that he had called at Finucane's house, initially pretending that he was from the IRA and wanted to borrow a car, but Finucane had not believed him.

Barrett described how Finucane was shot after being interrupted at dinner. "He referred to Mr Finucane as 'Fork Finucane' because he was still holding a fork when he died," said McIlwrath. "He pretended to hold a gun in his hands and to shoot at the floor as he described standing over Mr Finucane and firing at his head."

Bullets had apparently narrowly missed Barrett as they ricocheted off the floor. He told the detectives that he had used a 9mm Browning pistol.

The details tallied with what had actually occurred. Last week a senior officer in the Police Service of Northern Ireland, formerly the RUC, said: "That wasn't material that was in the public domain at the time and it wasn't known to Brown or McIlwrath. That was sufficient to convince us that he (Barrett) had some part to play in the house when Mr Finucane was murdered."

There was a problem, however. During the alleged conversation in the car, Barrett, it is claimed, pointed out to the detectives that nothing he said could be used in court because it was not signed and was not given under caution.

The CID officers wanted to obtain firmer evidence. After the meeting Brown had suggested taping Barrett secretly in more detail, then confronting him under caution and charging him. However, the Special Branch allegedly blocked the idea.

Barrett was not pursued. Nor was William Stobie, another man involved in the killing.

Just one year after Finucane died, Stobie, a former UDA quartermaster, admitted to police that he had disposed of one of the two weapons used in the murder. Despite this information no action was taken against Stobie, who was also a Special Branch informant.

The Sunday Times learnt last week that Alan Simpson, the detective who initially led the murder inquiry, was never told that Stobie and other loyalists were agents of the security forces.

Stobie was finally brought to trial only last year after a further investigation into the Finucane killing was ordered.

Although the trial collapsed because a key prosecution witness was too ill to testify, Stobie did not walk free for long. He was murdered last month for being an informer. Barrett, warned by police that he was also under threat, promptly went into hiding.

Had a blind eye been turned to the involvement of Stobie and Barrett in the Finucane killing?

Both Brown and McIlwrath, who are under a UDA death threat for speaking out, gave statements to the Stevens inquiry in 2000, outlining their accounts of what had happened.

Initially, detectives on the Stevens inquiry did not believe there had been a taped confession. They had received a tape from Special Branch dated October 3, 1991, the day when Barrett was alleged to have confessed in the car. But it contained no confession.

Brown and McIlwrath were nonplussed. Then they remembered that they, and the Special Branch officer, had met Barrett again on October 10. On the tape that had been given to the Stevens inquiry there was mention of two other murders that had taken place after October 3. This proved that the tape could not have been from October 3, as it was marked. It had to have been made later.

The Stevens inquiry was shocked but now accepts that the CID detectives were not lying. It has since recovered a written Special Branch source report of the October 3 meeting that confirms Barrett admitted to Finucane's murder. However, the tape of the conversation in the car has been lost.

McIlwrath has come forward because he believes that giving his version of events poses no additional threat to Barrett's safety or of prejudicing the Finucane case.

The Finucane family is still seeking a public inquiry into the murder and justice for the cold-blooded killing.

However, Hugh Orde, a deputy assistant commissioner of the Metropolitan police who is in day-to-day charge of the current Stevens inquiry, has stated that he sees little prospect of anyone being prosecuted for Finucane's murder.

The third Stevens report is due out in March or April. It is likely to be heavily critical of RUC Special Branch and British military intelligence for allegedly withholding information from their CID colleagues.

In April, a leading judge from a Commonwealth country is expected to be appointed to decide whether there should be a public inquiry into the Finucane case.