Police counter-terrorism Commander Richard Walton has been temporarily removed from his post following after a report into the original Stephen Lawrence murder investigation.
The Ellison report revealed an undercover officer, known only as N81, had been planted among supporters of the Lawrence family at the time of the Macpherson inquiry into racism in the Metropolitan Police.
In 1988, Mr Walton, who was then an acting detective inspector working on Scotland Yard's Lawrence review team, responsible for making submissions to the judicial inquiry, met N81, the report found.
Sir Paul Condon was Met Police Commissioner from 1993 to 2000 Commander Walton will now be moved from SO15 to a non-operational role, Scotland Yard said on Friday.
Earlier, former Met Police Commissioner Sir Paul Condon has said he did not know about the undercover officer.
Lord Condon said that he had neither authorised nor encouraged an officer to be used to get information about the parents of the murdered London teenager.
In a statement, Lord Condon, who was commissioner of the force at the time of Mr Lawrence's murder in 1993, added that he did not even know it had been done.
Stephen Lawrence wanted to be an architect The "spy in the camp" fed back information about the Lawrence family to the upper levels of the Metropolitan Police, the report by the barrister Mark Ellison QC concluded.
Lord Condon said: "I confirm and restate the comments I made in the House of Lords last month. That at no stage did I ever authorise, or encourage, or know about any action by any undercover officer in relation to Mr and Mrs Lawrence or their friends or supporters or the Macpherson Inquiry hearings.
"Had I known I would have stopped this action immediately as inappropriate."
The publication of the report triggered a full public inquiry into the actions of the Special Demonstration Squad (SDS), a now-defunct wing of special branch, amid fears some convictions may be unsafe as a result of their unorthodox work.
The Macpherson Report, which was published in 1998, concluded the police investigation into the murder of the 18-year-old at a bus stop in south London was hampered by institutionalised racism within the Met.
Speaking during a visit to Bedford on Friday, David Cameron said the revelations in the report had been "shocking" and said he agreed with the Home Secretary that there should be a full independent inquiry.
Metropolitan Police Commissioner Sir Bernard Hogan-Howe He said: "It should not have taken this long and the Lawrence family have suffered far too much.
"But this will get to the truth and will help us to make sure that we have the very best in terms of British policing which is what this country deserves."
David Norris and Gary Dobson were finally convicted of and jailed for Mr Lawrence's murder in 2012.
The teenager's mother, Baroness Lawrence of Clarendon, described the report as the "final nail in the coffin".
She said: "You can't trust them. Still to this day. Trust and confidence in the Met is going to go right down.
"People look at the Met Police as a good example of what everyone else should be doing across the world. Once this goes out now ... they can't be trusted."
The present Metropolitan Police Commissioner Sir Bernard Hogan-Howe said the report was "devastating" for the force and described it as "one of the worst days that I have seen as a police officer".
He said: "I cannot rewrite history and the events of the past but I do have a responsibility to ensure the trust and the confidence of the people of London in the Met now and in the future.
"This will need a considered response to meet head-on the concerns that have been expressed in yesterday's report."
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