Police investigators have made a dramatic u-turn and are now considering the death of Adriano Bussandri to be "unexplained rather than murder".
Mr Bussandri, 51, from Holroyd Road, Putney, was found dead in his property after a blaze ripped through his three-storey house on Friday morning.
Detectives initially launched a murder investigation on Sunday after deciding the evidence pointed to a suspicious death.
A post mortem supposedly revealed Mr Bussandri had "multiple injuries inflicted by a sharp object".
The investigation sparked grave concern in the community that a well-liked man could be murdered in such as fashion.
Police have been unable to explain why they made the error and have not provided any further explanation as to the circumstances behind Mr Bussandri's death.
A spokesman for the Metropolitan Police said: "One group of detectives investigated the incident on the weekend but another group examined the evidence again this week and decided it was unexplained rather than murder."
The body of Mr Bussandri was found at the address and a subsequent post-mortem examination at St George's Hospital mortuary gave cause of death as smoke inhalation.
An inquest will be held at an as yet announced date.
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