The job of Britain's most senior counter terrorist officer was on the line last night after a damning report found he misled the public.

Assistant Commissioner Andy Hayman failed to pass on information suggesting marksmen shot dead an innocent man, Brazilian Jean Charles de Menezes, as they hunted wanted suicide bombers.

It is a matter of "serious concern" that Mr Hayman misled senior officers and the public, the Independent Police Complaints Commission (IPCC) said.

His boss, Metropolitan Police Commissioner Sir Ian Blair, escaped serious criticism, but was accused of being "almost totally uninformed" of events following the death of Mr de Menezes on the morning of July 22, 2005. The family of the 27-year-old Brazilian electrician branded Scotland Yard "not fit for purpose" following the report.

A spokesman for the family's Justice4Jean campaign said: "The IPCC recommendation to merely issue (Andy Hayman) with a letter containing strong words of advice' is not the appropriate response - this report has made his position untenable.

"Regarding Sir Ian Blair, the report's findings make it seem unfeasible that he was not aware that they had killed an innocent man until the next day when so many people including senior officers, government officials and even the Met Cricket team were aware of that fact."

Simon Hughes, the local Liberal Democrat MP, also claimed Mr Hayman's position was untenable. "I can't see how he can continue to command the confidence of all the communities of London and remain in his present position," he said. Even off-duty officers at a cricket match heard rumours that the victim was a Brazilian unconnected to terrorism before the Commissioner, the report said.

The "shambolic mess" of Scotland Yard's botched operation that resulted in Mr de Menezes's death was laid bare in Stockwell 2, the findings of the IPCC inquiry into complaints about inaccurate information given to the public about the circumstances surrounding the shooting.

The report showed a catalogue of confusion as senior officers of the Metropolitan Police struggled to cope with the aftermath of the fatal shooting at London's Stockwell Tube station.

Mr de Menezes was wrongly suspected of being one of the four suicide bombers, whose attempt to explode their devices on the Underground the day before failed. Over a week earlier, 52 people died and more than 770 others were injured in the July 7 attacks.

The IPCC said of Sir Ian: "Whilst he personally may not have known the deceased was not a suicide bomber or a potential suicide bomber on July 22 a considerable number of his staff, including those advising him, had serious doubts but no-one told him."

It said he was "almost totally uninformed" of events on the fateful day and concluded that the complaint against him by the de Menezes family that he had misled the public was "not substantiated".

The Met Chief apologised for his force's failings but declared: "I did not lie." He also insisted that Assistant Commissioner Andy Hayman had his "full support" despite the fact that the IPCC said that he had "misled" senior officers.