Former President Lee Myung-bak has been cleared of the charges that he used taxpayers' money for his now-scrapped retirement home project, prosecutors said Monday.

Lee was under suspicion of giving instructions to former officials of the Presidential Security Service to use public funds to buy a plot of land on the southern outskirts of Seoul in 2011 to be used as his retirement residence.

Former President Lee later scrapped the project and moved into his existing private home in Nonhyeon-dong in southern Seoul after leaving office in February 2013.

Wrapping up a one-year investigation, the Seoul Central District Prosecutors' Office said it has decided not to indict Lee, citing the lack of evidence.

"It deems that former President Lee ordered (PSS officials) to buy the plot of land without being briefed about details of the costs," said an investigator close to the investigation, requesting anonymity.

In September 2013, the Supreme Court upheld suspended jail terms for two former PSS officials for incurring state losses worth 970 million won ($891,000) in connection with the land deal. (Yonhap)