The Justice Department agreed in June to pay $4.6 million to settle Hatfill's lawsuit against the government, but until Friday the government had not exonerated him, The New York Times reported.

"We have concluded, based on laboratory access records, witness accounts and other information, that Dr. Hatfill did not have access to the particular anthrax used in the attacks, and that he was not involved in the anthrax mailings," Jeffrey Taylor, the United States attorney for the District of Columbia, said in a letter to Hatfill's lawyer.

Officials say they believe the anthrax mailings were committed by military scientist Bruce Ivins, who died recently after taking an overdose of painkillers.

Sen. Charles Grassley, R-Iowa, who sits on the Senate Judiciary Committee, said lawmakers needed to conduct hearings to determine what went wrong in the investigation.

"We've had a seven-year investigation and $15 million spent on it and one of the 'people of interest' bought off for $5.8 million over what was obviously an FBI screw-up," Grassley said. "We need answers."

The FBI purchased an annuity that will be worth $5.8 million to Hatfill and his lawyers, the Times said.