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The Bush administration's Justice Department's actions were inappropriately political, but not criminal, when it fired a U.S. attorney in 2006, prosecutors said Wednesday in closing a two-year investigation without filing charges.

The decision closes the books on one of the lingering political disputes of the Bush administration, one that Democrats said was evidence of GOP politics run amok and that Republicans have always said was a manufactured controversy.

Investigators looked into whether the Bush administration improperly dismissed nine U.S. attorneys, and in particular New Mexico U.S. Attorney David Iglesias, as a way to influence criminal cases. The scandal added to mounting criticism that the administration had politicized the Justice Department, a charge that contributed to the resignation of Attorney General Alberto Gonzales.

In 2008, the Justice Department assigned Nora Dannehy, a career prosecutor from Connecticut with a history of rooting out government wrongdoing, to investigate the firings.

"Evidence did not demonstrate that any prosecutable criminal offense was committed with regard to the removal of David Iglesias," the Justice Department said in a letter to lawmakers Wednesday. "The investigative team also determined that the evidence did not warrant expanding the scope of the investigation beyond the removal of Iglesias."

Prosecutors also said there was insufficient evidence to charge someone with lying to Congress or investigators.

Iglesias was fired after the head of New Mexico's Republican Party complained to the White House that Iglesias was soft on voter fraud. He asked that Iglesias be replaced so that the state could "make some real progress in cleaning up a state notorious for crooked elections."

Harriet Miers, then White House counsel, told lawmakers that presidential political adviser Karl Rove was "very agitated" over Iglesias "and wanted something done about it." Rove has said he played no role in deciding which U.S. attorneys were fired, that the firings weren't politically motivated and that he never sought to influence prosecutions.

Dannehy faulted the Justice Department for firing Iglesias without even bothering to figure out whether complaints about him were true. That indicated "an undue sensitivity to politics on the part of DOJ officials who should answer not to partisan politics but to principles of fairness and justice," the Justice Department wrote in its letter.

But that was not a crime, and was not an effort to influence prosecutions, the letter said.

Gonzales' lawyer, George Terwilliger, called the conclusion long overdue.

"Those who made unwarranted allegations to the contrary owe him an apology," Terwilliger said. "After having spent months cooperating with inquiries that produced no evidence of his wrongdoing, Judge Gonzales is pleased to be free to resume a career marked to date by service to the public."

Former Sen. Pete Domenici, R-N.M., also became a focus of the investigation because he made three phone calls to the attorney general and one to Deputy Attorney General Paul McNulty complaining about Iglesias. McNulty didn't mention Domenici's phone calls when questioned by Congress, leading to accusations over a coverup.

Dannehy concluded that Domenici's push to have Iglesias fired was in part politically motivated but did not violate the law.

Iglesias also said Domenici called him and pressured him to bring charges in a public corruption case before Election Day 2006. The Senate Ethics Committee said Domenici created an appearance of impropriety with that phone call, and he apologized.

Dannehy said there was not enough evidence to show that phone call was either an attempt to pressure Iglesias to accelerate the case or a threat that if he didn't, he'd lose his job.

"The Justice Department has now confirmed what I have always said and believed: I never attempted to interfere with any government investigation," Domenici said. "I am glad that this matter has concluded."

House Judiciary Committee chairman John Conyers of Michigan said Dannehy's decision is not an exoneration of Bush administration officials.

"There is no dispute that these firings were totally improper and that misleading testimony was given to Congress in an effort to cover them up," Conyers said in a statement.

The nine prosecutors who were fired were: Daniel Bogden of Nevada, Paul Charlton of Arizona, Margaret Chiara of Michigan, Bud Cummins of Arkansas, Todd Graves of Missouri, Carol Lam of California, John McKay of Washington, Kevin Ryan of California, and Iglesias.