The State Department review of the Benghazi terror attack let senior officials off the hook for the policy decisions that led to sub-standard security at the U.S. compound in eastern Libya, according to a draft House committee report obtained by Fox News.

The nearly 100-page report concludes that the State Department’s internal review board -- called the Accountability Review Board, or ARB -- was flawed. The report by Republicans on the House Oversight and Government Reform Committee alleges the board’s probe was not comprehensive, its interviews were not thorough, and the investigation itself may have been damaged by conflicts of interest.

A central finding is that the department, as a result of the board’s findings, meted out discipline to four mid-level officials (who were later re-instated anyway), but the board glossed over the actions and decisions of senior-level officials. The report claims the internal review identified many of the security problems with the Benghazi compound, while ignoring who was behind the policy decisions that led to them.

Specifically, the report points to the authorization by Under Secretary for Management Patrick Kennedy to continue operating the ad hoc compound in Benghazi. The interim report found that a December 2011 action memo, prepared by Assistant Secretary of State for Near Eastern Affairs Jeffrey Feltman and signed off on by Kennedy, green-lighted the operation. Witnesses told Republican investigators that this decision to run the operation on an ad hoc basis was largely responsible for the inadequate security presence on the ground in Benghazi, not money.

The report also noted that it’s unclear which other senior leaders were involved in this decision but said it is likely, based on email evidence, that former Secretary of State Hillary Clinton’s views played a role in the decision-making.

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None of the four State Department employees who were disciplined after the ARB was released in December, and later re-instated by Secretary of State John Kerry in August, were responsible for making policy. The draft states that the use of administrative leave was meant to leave the impression of accountability.

A review of congressional testimony and internal State Department memos by Fox News in June found that the policy decision to maintain a presence in Benghazi with substandard security was made at the most senior levels of the State Department by officials who have so far escaped blame -- including Feltman, Kennedy and Clinton.

The draft interim report, which was produced by the Republican majority, states clearly that Clinton wanted to extend the Benghazi operation. It reported that several officials within the Near Eastern Affairs office recalled Clinton's desire to leave the operation in place once the primary diplomatic facility in Tripoli was re-opened.

In the summer of 2012, as security conditions unraveled, with documented attacks on western facilities, a State Department officer who served on the Libya desk said Kennedy was asked about the mission's future, and Kennedy said he would first have to check with Clinton. Based on a conversation between Ambassador Chris Stevens – who was later killed in the attack -- and Clinton, Stevens’ deputy Greg Hicks testified it was the former secretary of State's personal goal to have a permanent operation in Benghazi.

State Department Assistant Secretary of State Douglas Frantz said Sunday that the ARB's and State Department's response to Benghazi has been "thorough and transparent."

"In fact, it set a new standard for transparency measured by tens of thousands of pages of documents turned over to Congress, testimony in public and closed hearings and a declassified report for the public," he said. "To suggest anything has been hidden or that accountability has been averted requires willful ignorance of these facts."

“Twisting the facts to advance a political agenda does a disservice to those who lost their lives and those who have devoted the past year to understanding what happened and implementing security procedures to make certain it does not happen again," Frantz added. "The ARB report did not find that any individual willfully ignored his or her responsibilities or engaged in misconduct; it did not find that anyone breached his or her duty so as to be subject to termination or other discipline. It did, however, identify leadership deficiencies on the part of four employees"

Rep. Elijah Cummings, the committee’s top Democrat, in a written statement called the report's claims "unsubstantiated accusations."

“This Republican report is not an official Committee report, but rather a completely partisan staff report that the Chairman apparently did not want Committee Members to see before he leaked it to the press. Rather than focusing on the reforms recommended by the ARB, Republicans have politicized the investigation by engaging in a systematic effort to launch unsubstantiated accusations against the Pentagon, the State Department, the President, and now the ARB itself," he said.

But the draft report said that there were other problems with the internal review.

As one example, the co-chairman of the ARB Ambassador Thomas Pickering told investigators that his team had the authority to conduct depositions, and the authority to issue subpoenas. But the Board never used these authorities, instead relying heavily on group and individual interviews.

While the ARB placed blamed on the State Department Bureau of Near Eastern Affairs for "systemic leadership and management deficiencies," the NEA's second in command was only interviewed once, in a group setting. Adm. Mike Mullen, the other co-chairman of the ARB, was asked by congressional investigators why the second in command was not more thoroughly questioned, and according to the draft, Mullen said the official did not seem to bear significant responsibility.

The draft interim report also concluded that the State Department's unwillingness to provide the working documents from the ARB made an independent assessment by the congressional committee difficult. Rather than record or transcribe interviews, the ARB relied on summaries. Mullen said he found the summaries to be accurate.

Mullen subsequently described, however, an example of how a culture of collegiality could undermine the ARB’s independence. Mullen put Cheryl Mills on notice that Deputy Assistant Secretary for International Programs Charlene Lamb’s interview with the Board could be “difficult” for the State Department.

(On Sep. 18, the Republican staff issued a clarification to its report that Mullen put Cheryl Mills on notice, saying that Deputy Assistant Secretary for International Programs Charlene Lamb’s interview could be difficult, not Ms. Mills' questioning.)

The interim report states that members of the House oversight committee, led by Republican Rep. Darrell Issa, R-Calif., will sharpen its focus on the senior State Department officials who drove the policy decisions in Benghazi.

The failure to affix blame above the assistant secretary level could impact future decisions on "expeditionary diplomacy" where diplomats are now operating in areas they would have pulled out of a decade ago. Critics have accused the Obama administration of favoring a light footprint which does not reflect the security conditions on the ground.

The draft interim findings will be released early next week. The House oversight committee has hearings scheduled for Sept. 19.

Fox News' James Rosen contributed to this report.