The former So Solid Crew member told Now that he had a "communication relationship" with Cole following her separation from ex-husband Ashley in 2010.
The 'Call My Name' singer strongly denied the suggestion, asking Harvey via Twitter: "Was this 'relationship' happening in your head?", but Now stood by the claims after having "several hundred emails" apparently between Cole and Harvey over a six-month period verified by a media lawyer.
Cole responded by taking legal action against the publication, while Harvey played down the extent of his 'relationship' with the former X Factor judge, saying that he was "mortified" and "devastated" by the situation.
In an apology published in the new issue of Now today (February 19), the magazine announced that it has agreed to pay damages and legal costs to Cole after determining that the emails allegedly sent from her to Harvey are "not genuine", and are in fact the work of a hoaxer who "went to great lengths to deceive" the rapper into thinking he was talking to Cole.
"In an article last February we said that Cheryl Cole had had a secret romantic relationship with Michael Harvey Jr, aka MC Harvey, formerly of the group So Solid Crew," the statement from Now read.
"When Cheryl went to Twitter to deny this we published a second article saying we'd seen emails that evidenced there had been a relationship. Although we had seen several hundred emails, written over a six-month period, apparently between Cheryl, her mother and Michael, we are now satisfied that the emails from Cheryl and her mother are not genuine.
"They appear to be the work of a calculated and meticulous hoaxer masquerading as Cheryl who went to great lengths to deceive MC Harvey. The hoaxer's motives remain unknown but what has become clear is that there was never any relationship between Cheryl and Michael and we were wrong not to accept Cheryl's denial.
"We're sorry, Cheryl, for any embarrassment and upset we have caused you. We have agreed to pay Cheryl damages and her legal costs."
Digital Spy contacted MC Harvey's representatives, but they are not yet able to comment.
Update: Cheryl Cole and MC Harvey have since gone to war on Twitter over the apology.
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