Victoria Police has conceded significant failures in the way it dealt with gangland witnesses and informers, but is confident reforms will prevent a repeat of the disasters that have dogged the case of murdered informer Terence Hodson.

Force command's concession that there is "clear room for improvement in how we had dealt with them [informers] in the past" comes as a joint Fairfax Media and ABC Four Corners investigation reveals:

• Outgoing police chief Ken Lay is urging Victoria's coroner to find ex-cop Paul Dale and dead gangland boss Carl Williams responsible for the 2004 murder of career criminal Hodson;
• Two former senior detectives closely involved in the Hodson case say the force mishandled it for several years in an apparent effort to contain a corruption scandal and avoid a royal commission; and
• The force failed for several years to investigate critical information about Dale's alleged corruption, including his links to Williams and an alleged offer to work as a hitman.

In a murder Mr Lay has described as the having "struck at the heart of public safety and the administration of justice", Hodson was shot dead along with his wife Christine at their Kew home May 2004.

Some months earlier, Hodson had agreed to testify against the former sergeant Dale over his alleged involvement in a drug burglary in September 2003.

In 2007, Dale was implicated by jailed killer Williams in Hodson's murder, but murder charges against Dale were dropped in 2010 after Williams was fatally bashed in prison by a fellow inmate. Dale has maintained he has never acted corruptly and has no link to Hodson's murder.

Former anti-corruption detective senior sergeant Murray Gregor, who recruited Hodson as a corruption witness in late 2003 and was forced to withdraw burglary charges against Dale in 2004, says the information about Dale's alleged corruption and links to Williams' crew should have been thoroughly investigated when it was first raised over a decade ago. 

Unshared information 'crucial'

Mr Gregor has also revealed that information collected by other police about Dale through phone taps before the murders, but not shared with him or other anti-corruption investigators, may have been "crucial" to protecting Hodson.

Mr Gregor said he was so concerned at the force's handling of the Hodson case and failure to probe suspected corruption after the murders, that he broke ranks and urged the now defunct Office of Police Integrity to conduct its own probe.

Mr Gregor's views are largely supported by a second former detective senior sergeant, Charlie Bezzina, who for three years led the probe into the Hodson murders.

Both detectives say Hodson could have been better protected by the force as an informer and after he became a star anti-corruption witness, with Mr Bezzina describing aspects of Hodson's protection as "inept".

Although Hodson refused to go into witness protection, Mr Gregor conceded police provided sub-standard surveillance equipment to Hodson and failed to "seriously consider" other measures, such as temporary relocation and roving police patrols.

The revelations come as the force braces itself for the findings of a major probe by the Independent Broad Based Anti-Corruption Commission into its handling of a key witness in the Hodson saga. This figure can't be named for legal reasons.

Major reforms already implemented

A police spokesman said the force has already implemented several major reforms – and would make further changes if required – after reviews into informer and witness handling by "two former high ranking police officers".

Among the claims made about Dale that the force initially failed to examine were allegations made by Hodson and others in 2004 that Dale was working Williams and had offered to perform gangland killings for $250,000.

Some of the claims appear to be corroborated by information Williams told police in 2007 and 2009, including the hitman allegation, which was later aired in court.

But Dale, who declined to be interviewed, has dismissed these claims, saying that Hodson and Williams invented them to get reduced jail sentences or financial inducements.

Both former detectives say they did not know of phone taps recorded by other police prior to the Hodson murders, including taps that captured Dale urgently seeking a meeting with Williams at Hillside in Melbourne's north-west.

Mr Gregor said the phone tap information would have been crucial to protecting Hodson and his investigation into Dale.

Petra corroborated claims

The phone taps only formed part of a probe into Dale after 2007, when a jailed Williams told police that Dale had asked him during the Hillside meeting to kill Hodson. Williams later alleged that after Dale's request, Williams organised hitman Rodney Collins to murder Hodson.

In his submission to the coroner's inquest into the Hodson murders, the retiring Mr Lay has alleged that Petra [the Victoria Police Taskforce] corroborated many of Williams' claims about Dale and supported allegations he leaked  files about Hodson's informer status to the underworld to incite his murder.

While Mr Lay submits that there is no proof about what was precisely said at the Hillside meeting, there is still enough evidence for the coroner to find that "Dale and Williams are both persons who contributed" to Hodson's murder.

In his own coroner's submission, Dale maintains his innocence, saying the police case is deeply flawed, relies on flaky witnesses and ignores multiple other suspects.

Counsel assisting the coroner, Chris Winneke, has submitted there is insufficient evidence to implicate Dale in the murder.

Former chief commissioners during the Hodson case, Christine Nixon and Simon Overland, declined to comment. The coroner is yet to report his findings.