The New Zealand Security Intelligence Service (SIS) has agreed to pay investigative journalist Nicky Hager $66,400 in compensation and legal costs over the unlawful seizing of his private phone.

The unlawful seizing happened after the release of Hager’s book Other People's Wars in 2011, which was about NZ’s military and intelligence activity in Iraq and Afghanistan.

The SIS seized two months’ worth of Hager’s phone records in 2012 after being enlisted to help by the NZ Defence Force, Hager’s barrister Felix Geiringer said, but the searches proved “fruitless”.

Neither the Defence Force nor the SIS was able to uncover any of Hager’s sources.

Hager was not available for comment but said in a statement that he was pleased with the result. However, he said “much more” needed to be done to prevent unlawful actions by agencies like the SIS. 

“Our intelligence services repeatedly claim that they have become more transparent and more careful to obey the law,” he said.

“But when I requested information from the NZSIS director Rebecca Kitteridge about the suspected NZSIS help to find my sources, she refused to confirm or deny the existence or nonexistence of the information.”

Geiringer said the decision was an “important result for journalism”.

“Our intelligence services are given substantial powers for use to protect New Zealand from harm,” he said. “Those powers cannot be used to go after a journalist’s sources just because the government does not like what that journalist is saying.”

The SIS also published a public apology to Hager. The agency said it apologised “unreservedly” for breaching Hager’s rights.

It also said the spy agency had accepted that it acted unlawfully in obtaining that data and Hager had a “reasonable expectation” of privacy in his home telephone.

“Investigative journalists such as Mr Hager play an important role in society, including to provide an additional check on executive functions and powers,” the statement said. 

“NZSIS recognises that its actions in 2012 could have resulted in a chilling effect on such important work.”