Former National Party president Michelle Boag is demanding an apology from ACC after police said they would not prosecute her friend Bronwyn Pullar for trying to blackmail the corporation over a privacy breach.
Ms Boag supported her friend Ms Pullar during a December meeting with ACC managers Philip Murch and Hans Verberne, who claimed Ms Pullar threatened to go to the media about a privacy breach unless she was given a two-year guaranteed benefit.
ACC referred the matter to the police in March, after Ms Pullar had gone to the media about ACC's error in sending her information about 6700 other claimants in August last year.
But yesterday, after reviewing evidence - including a recording of the December meeting made by Ms Pullar - police confirmed they would not press charges against her.
Nevertheless, while accepting the police decision ACC chairman John Judge continued to back Mr Murch and Mr Verberne's account of the meeting.
Mr Judge said he was satisfied their version of events was a "complete and accurate" account of what took place at the meeting.
"Our staff at the meeting considered that a threat had been made ... they felt pressure."
Ms Boag believed ACC had also laid a complaint against her as she received a call yesterday from police informing her of their decision not to prosecute.
She said Mr Judge's comments yesterday were a repetition of the "accusation and defamation against me" and "an appalling example of corporate bullying".
She was considering taking legal action over the comments but feared taking on the corporation's taxpayer-funded legal team was beyond her means.
"At the very least I'm owed a fulsome apology.
"I do not understand how the chairman and chief executive of a significant government corporation can stand by managers who have proven to have lied to their bosses and to their minister."
Ms Boag said the police had reached their decision not to prosecute without even interviewing Ms Pullar or herself.
ACC Minister Judith Collins refused to comment, saying it was an operational issue for the corporation, but Ms Boag said it was time for her to front up.
"She has been lied to and the police have confirmed that. How does the minister feel about that and how does she feel about perpetuating those lies in Parliament and in the media?"
Labour ACC spokesman Andrew Little said there was an "absolute contradiction" between the police decision yesterday and the March report.
With ACC chief executive Ralph Stewart unwilling to explain that contradiction, "then it falls squarely in the lap of the minister to say whether or not she is satisfied that the situation has been handled appropriately by the corporation".
* In ACC's March report to ACC Minister Judith Collins, it said Bronwyn Pullar "proposed in relation to her own individual case she would like to negotiate a guaranteed benefit payment for two years".
* "She made threats that if her demands weren't met, she would not return the information and would inform the media."
* Police Assistant Commissioner Malcolm Burgess said yesterday: "After careful consideration of the evidence now available and a separate legal review of the facts we have determined that no offence has been disclosed."