A report by the Auditor-General into Labour MP Shane Jones' handling of an immigration case does not reach a 'black and white' conclusion, sources say.
In 2008 the former Cabinet minister decided to grant Chinese billionaire Bill Liu citizenship, against the advice of officials.
The case blew up last year when Liu appeared in court, charged with passport fraud. He was cleared, but the subsequent furore saw Labour leader David Shearer demote Jones, and call for the report.
Media today reported that Jones had been cleared by the probe. That would pave the way for his return to the front bench.
But a source who has seen the report, has warned the watchdog's conclusions were not straightforward in exonerating Jones.
"Those matters are a question of degree, and I would refrain from rushing to judgement ... the arguments are quite complex," the source said.
Another source agreed, saying the report is not "unequivocal".
Labour Party sources have previously indicated they expected Jones to be exonerated although the report was expected to contain criticisms of process.
Those who have received the draft report are under very strict legal obligations not to share it. They have two weeks to respond.
Jones and former minister David Cunliffe had both received the draft but will not comment on it. Shearer has not seen the report.
The interim report was ''pointing in the right direction'' Shearer said.
He said he had a brief chat with Jones about the report yesterday, but was yet to read it.
''It looks to him to be reasonably straightforward, but when I spoke to him he hadn't actually read it thoroughly himself either and he was going to give it to his lawyer.''
''From what I understand there is no criminality or anything involved, which we always expected, but that's all I know,'' Shearer said.
The affected parties now had a few days to respond before the final report was issued. That was expected ''in a short number of weeks' rather than months - I certainly hope so''.
''It's pointing in the right direction from what I understand, but I will have to wait until I see the final report.''
He would look at the interim report and consult with colleagues before making a final decision on the timing of his planned reshuffle.
Dover Samuels, a former Labour MP and close friend of Liu, confirmed the report has been sent to affected parties - but he hasn't yet seen it. He expected Jones to be cleared.
"I think a big injustice has been created and I made those submissions to the Auditor-General," he said.
"I think at the end of the day, when the facts are known, Mr Jones made the right decision. He was the only one subject to all the information."
Samuels wrote a letter of support for Liu - as did former Labour MP Chris Carter and National MP Pansy Wong.
A spokeswoman from the Auditor-General's office said a draft report was released for consultation a couple of days ago and it would be a few weeks until the final report was released.
She stressed the present document was a draft and "things still could change".
Liu, who made sizeable donations to the Labour Party, applied for citizenship in 2005 and it was approved despite Chinese authorities posting a "red notice" with Interpol.
They claimed he was born Yong Ming Yan and stole the identity of Yang Liu in 1999, obtaining two false passports. He was wanted for embezzlement.
However, Liu's supporters said the claims were false, made because Yan was a long-time supporter of the Falun Gong movement.
His immigration file, with a recommendation that citizenship be declined, passed to Internal Affairs Minister Rick Barker who delegated it to his associate, Shane Jones because of a conflict of interest.
Jones approved the application over the advice of officials - who said there were too many doubts over Liu's true identity.
Last year Jones said he feared Liu would be deported to China, executed and his organs harvested.
- © Fairfax NZ News
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