Indian Dr. Mohamed Haneef, who was working in Australia in 2007, was arrested July 2 but the director of public prosecution withdrew the charges and he was released July 27.

His passport was returned but his work visa was canceled and he voluntarily left the country July 29 to return to India.

He returned to Australia last week to begin final mediation talks with the federal government to reach a financial settlement. Haneef's lawyers were in discussion seeking damages for malicious prosecution, false imprisonment and defamation.

A smiling Haneef, with his wife and daughter beside him, left the mediation talks and told waiting reporters in Brisbane's central business district that he was "pleased and relieved" that the affair has finally ended.

"I'm happy with the resolution of this matter," Haneef said. "My wrongful arrest and detention in 2007 was a very traumatic experience and today's settlement was a chance to end this part of my life and move on with my family."

His detention became a cause celebre for civil rights activists because Haneef was the first person arrested and detained under the 2005 Australian Anti-Terrorism Act. He also was the first person to have his detention extended under the act and was held for 12 days without being charged with a crime.

Haneef was arrested while working at the Gold Coast Hospital in the city of Gold Coast, on the northeast coast of Australia in Queensland state. He was held on suspicion of helping people organize terrorist activities in London and Glasgow in the United Kingdom that year.

However, an inquiry cleared him of any involvement in the attempted terrorist attacks and also concluded that that the Australian Federal Police had made serious errors during its investigation.

Haneef had been working at a hospital in the United Kingdom in 2006 when he decided to seek work in Australia, landing employment as the registrar at Gold Coast Hospital starting in September that year.

But police picked him up July 2, 2007, at Brisbane Airport when he was about to board a flight to India to see his wife and 6-day-old daughter.

Haneef was a second cousin to one of the two terrorists who drove a Jeep Cherokee packed with filled propane tanks through the glass doors of Glasgow International Airport in the afternoon of June 30, 2007.

Security guards managed to save the two occupants of the burning vehicle -- Bilal Abdullah, a British-born, Muslim doctor of Iraqi descent working at a local hospital, and Kafeel Ahmed, the driver. Several people were injured but no one was killed in the attack.

Abdullah was found guilty of conspiracy to commit murder and was sentenced to 32 years in prison. Ahmed died of his burns and injuries two months later.

Australian police initially said that Haneef's cell phone SIM card was found in the burned wreckage of the Jeep. But police later admitted, just before releasing Haneef, that that was not true; it was still in the possession of another cousin, several hundred miles away in Liverpool, England. Haneef had given the SIM card to him as a gift just before he emigrated to Australia.

Britain's Metropolitan Police -- Scotland Yard -- were said to be wondering how the Australian Federal Police could allow "such a major cock-up" to happen, a report in the Sydney Morning Herald said July 21, 2007, just before Haneef's release in Australia.

"Australian police have got their wires crossed," an unnamed Met source said. "This is very embarrassing for them. The police here are laughing at the Australian police, saying, 'What on Earth have they done?' (Haneef) is clearly more of a political case than a police case."

After the mediation talks, Haneef said he didn't want an apology from the Australian authorities and thanked the federal government for reaching an agreement.

Haneef, who is working in the United Arab Emirates as a doctor, also said Australia was a "fair" place to live and work.

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