Lawyers made the disclosure as one of the men charged in connection with the journalist’s killing was granted permission to return to live in Lurgan.

But Lord Justice Coghlin also banned Robin King (42), from having contact with anyone with loyalist links.

King is charged with attempting to pervert the course of justice following a reinvestigation into the shooting of Mr O’Hagan in September 2001.

The Sunday World reporter, who specialised in exposing loyalist paramilitaries and drug dealers, was gunned down near his home in Lurgan.

His killer is believed to have opened fire from a Subaru car which pulled up beside the journalist and his wife as they walked home from their local pub.

King was arrested along with a number of other suspects, including three who were then charged with murder, following statements made to police by an unidentified man, known only as Witness A.

During previous court hearings the informant, whose credibility has been questioned by defence lawyers, was said to have continued living in the general Portadown and Lurgan area.

However, Crown counsel Nicola Auret revealed: “I have just been updated by the police officer that while Witness A was in that area he no longer is in that area.”

Mrs Auret was opposing an application by King - who has been staying at Hamiltonsbawn, Armagh, since being released on bail last month - to be allowed back to his home at Burren Close, Lurgan.

She claimed: “It would undermine the public confidence in this police inquiry by him simply being back in the area full-time.”

During King’s original bail hearing it was alleged that Witness A heard discussions between him and another man about destroying the car used in the shooting.

His lawyer said today that with a curfew already imposed on him, it made no difference where police carried out checks on him.

The court was told that under the original conditions King was allowed to go into Lurgan as long as he left again by night-time.

Directing that he could stay there, Lord Justice Coghlin said: “The fundamental, if not only, objection put forward on behalf of police is the potential interference or intimidation of Witness A’s family, which I recognise to be a real concern.”

The judge emphasised the curfew on King and said: “He’s not to contact or associate with, directly or indirectly, any person with paramilitary or loyalist connections.”