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Police have decided not to take further action after they were called in to a county council by a senior officer.
North Wales Police had received a complaint in March from the local authority in Anglesey "in relation to events within the council".
A team from the office of the Auditor General for Wales is currently inspecting how the council is run.
The Auditor General said the police inquiry did not arise from work by the audit staff.
The police were contacted by the un-named officer as staff from the Auditor General's Office began an inquiry into how the council is governed by councillors and politicians.
A senior police officer interviewed the complainant but has now said the matter will not be taken any further.
It is understood that the evidence gathering phase of the auditor's inquiry is also now complete, and the report is in process of being written up.
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