The PSNI Chief Constable has decided detectives from outside Northern Ireland should investigate the activities of a British agent in the IRA allegedly linked to 50 murders, the High Court in Belfast heard.

A judge was told George Hamilton’s “preferred option” is to have officers from another force investigate claims about the British army’s prized intelligence asset, who operated under the codename ‘Stakeknife’.

Confirmation came during a legal action being mounted by the family of a Belfast woman killed by the IRA.

Caroline Moreland, a 34-year-old Catholic mother of three, was abducted and murdered in July 1994 for being an alleged British informer. Her children are seeking to secure a wide-ranging investigation into the full circumstances surrounding a series of killings stretching back to the 1980s and attributed to the IRA’s internal security team.

In October, Director of Public Prosecutions Barra McGrory QC called for police to examine Stakeknife’s activities, along with what was known by RUC Special Branch and MI5.

Although relatives of those allegedly killed by the IRA’s so-called ‘Nutting Squad’ have backed that move, they are opposed to the PSNI taking charge.

At a previous hearing, it was claimed that west Belfast man Freddie Scappaticci was permitted to engage in the campaign in order to strengthen his position as a British spy.

Scappaticci left Nothern Ireland in 2003 when he was identified by the media as Stakeknife. He strongly denied being the agent.

Counsel for the Moreland family argue that police with no ties to Northern Ireland should carry out the investigation. During an earlier stage in the case it was claimed that relatives of up to 50 murder victims are waiting for answers.

In court on Friday, a barrister representing the PSNI confirmed the decision reached on how the inquiry should be handled.

“The Chief Constable, I’m instructed, has identified a preferred option for dealing with (the Director’s) request, which involves bringing in external police officers,” said Paul McLaughlin. “He’s at present engaged in discussions with the Policing Board about how to take that forward.”

Northern Ireland’s Department of Justice and the Secretary of State are also to be consulted on how the move can be funded. But with the plans not yet finalised, a judicial review hearing remains listed for next month.