Police chief George Jackson last night said he still believes confidential files at the centre of the Bermuda Housing Corporation row were stolen — and that someone could face criminal charges.

The Commissioner of Police also refuted Auditor General Larry Dennis' allegation that his arrest amid theft allegations last summer was politically motivated.

He said he had to join forces with Government for a high-profile attempt to gag the media from reporting details from the BHC files last year — because otherwise he would be condoning "those responsible for the theft".

Mr. Dennis has argued he has reason to believe Police knew all along where the documents came from, and that they were copies which could not be considered stolen property as a matter of law. In his annual report last month, Mr. Dennis said the dossiers were handed to him by a member of the public who picked them up from an unsecured public throughway where they had been left for up to six weeks.

He described last year's arrest and raid on his office as "very much debatable", pointing out Police already knew who his source was a week beforehand.

He believes it was a politically motivated attempt to discredit him in the run-up to the General Election.

In a statement last night, Mr. Jackson said: "It is with deep regret that I find myself compelled to respond to the ongoing unanswered assertions and challenges made publicly by the Auditor General Larry Dennis, against myself the Commissioner of Police and the Bermuda Police Service generally.

"These comments surround the media release of information from confidential Police files, relating to the BHC investigation, that are believed to have been stolen and Mr. Dennis' subsequent arrest and interview. When it became known that the Auditor General claimed to have possession of the documents every effort was made by the Commissioner of Police to obtain consensual cooperation from the Auditor General to that investigation.

"Mr. Dennis refused and as a result the normal procedures for conducting a criminal investigation were followed. That protracted investigation continues, is being led by experienced officers from the BPS, overseen by the Assistant Commissioner of Police Mr. Bryan Bell, and has been reviewed by officers from Kent Police UK.

"As that matter has not concluded and may lead to criminal charges I am unable to expand on the details at this time."

Police and Government failed to gag the media in the courts in Bermuda and then the Privy Council in London, landing taxpayers with a six-figure costs bill. Explaining his motivation, Mr. Jackson said: "Much has been made in the press of the legal action I took in an attempt to prevent wider publication of those documents.

"I believe strongly that such release condones the actions of those responsible for the theft of the documents, undermines the confidence the public have in their Police Service and if unchecked is unfair to the parties involved.

"I totally refute claims that any of my actions have been politically motivated.

"As Commissioner of Police I work closely with senior colleagues across Government and throughout Bermuda, including the Auditor General.

"Let me state categorically neither I nor any of my officers are under any political influence in the conduct of investigations. "In serving Bermuda my aim remains to ensure fairness to all, to uphold the law and to provide a safe and secure environment for all."