Prosecutors have closed an extortion investigation into Mayor Yury Luzhkov's powerful deputy Alexander Ryabinin over a lack of evidence.
The Investigative Committee announced last week that Ryabinin, head of City Hall's Control Committee, which authorizes construction permits and land sales, was suspected of abuse of office.
But Moscow's chief prosecutor, Yury Syomin, said the case was dropped after investigators failed to collect enough evidence that Ryabinin had committed a crime, Vremya Novostei newspaper reported Monday.
Ryabinin, 50, was accused of pressuring an unidentified Moscow businessman into handing over valuable retail property covering more than 200 square meters in central Moscow to Ryabinin's daughter.
According to investigators, Ryabinin threatened to block approval of a construction project that the businessman had filed with his Control Committee.
City Hall had denounced the allegations against Ryabinin as unwarranted.
Ryabinin is the most senior Moscow official to have been targeted by investigators since Luzhkov took the reins of the city in 1992. Political analysts have said the case appeared to be an attempt by the Kremlin to unseat Luzhkov.