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'No new evidence' against mayor
Scotland Yard said there is "no new credible evidence" into allegations of fraud and financial mismanagement against an elected mayor - but added that they are still investigating an original claim against him.
Bangladesh-born Lutfur Rahman, mayor of Tower Hamlets in east London, was being investigated over claims by Panorama that he doubled recommended funding for Bengali-run charities in an attempt to buy influence.
Communities Secretary Eric Pickles sent inspectors into the borough to investigate his activities but, after Met officers reviewed the allegations, they found no new evidence of fraud or other offences.
But a Met spokesman added that the mayor is still being investigated over the original claims in relation to the Brady Youth Forum, which were made on March 20.
Mr Rahman denies the accusations, which were originally made in a BBC Panorama documentary.
Earlier this month, police received three files from Mr Pickles's Department for Communities and Local Government (DCLG) comprising information from the public and Panorama.
DCLG also ordered PricewaterhouseCoopers (PwC) to carry out a financial inspection of the council and officers have been liaising with the company.
The Met said it was appropriate for the department and PwC to continue their reviews but said officers found no new evidence of criminality.
In a statement, a force spokesman said: "On Friday April 4 the Metropolitan Police Service received three files of material from the Department of Communities and Local Government relating to the London Borough of Tower Hamlets.
"These comprised of material referred to the DCLG by a member of the public and by the BBC Panorama programme.
"The files have been reviewed by a team of officers over the past six days. In addition, officers have liaised with Pricewaterhouse Coopers LLP (PwC) who are conducting a full and wide-ranging audit of financial matters at the London Borough of Tower Hamlets.
"There is no new credible evidence of criminality within the files to provide reasonable grounds to suspect that fraud or any other offence has been committed at this stage.
"Therefore the MPS will not be investigating at this point in time and believe that it is appropriate for the material to be reviewed further by PwC and DCLG. We will continue to liaise with them, should their audit uncover any evidence of criminality."
However, he added that the investigation into the original claims was still ongoing.
" Prior to this, a report was made to Tower Hamlets Police on 20 March by Tower Hamlets Council.
"The report concerned an irregularity with regards to money being awarded to the Brady Youth Forum, in January and April 2013, that was identified by an internal review. This investigation is being carried out by Tower Hamlets CID."
Mr Rahman was accused by Panorama of more than doubling public funding to Bangladeshi and Somali groups from £1.5 million to £3.6 million in the face of recommendations from council officers.
The mayor hit back at the allegations, claiming they were motivated by racism and Islamophobia.
Mr Pickles then asked inspectors to focus on grant payments, the transfer of property by the authority to third parties, publicity spending decisions, and contractual processes since the mayor was elected.
PwC has been asked to report back to the Communities Secretary by June 30.
Tower Hamlets Council insisted it had "seen no evidence" that its processes had been run inappropriately.
A spokesman for the council said: "The news from the Metropolitan Police is to be welcomed and Tower Hamlets will continue to work with the auditors and DCLG."
The BBC stood by its Panorama programme, saying the accusations it made could still relate to "potentially unlawful expenditure".
A BBC spokeswoman said: "We continue to stand by the programme's findings which uncovered serious concerns about the use of public money, which are still being investigated by the Government.
"Our programme did not say there was evidence of criminality. The allegations relate to potentially unlawful expenditure, not to a criminal matter."
A DCLG spokesman said: "A wide-ranging investigation of Tower Hamlets by PricewaterhouseCoopers is ongoing".