[Humjob]

If the government ends up prosecuting him, it will be a massively idiotic move on their part. It's already bad enough that they've withdrawn their job offer. To use a war analogy, this situation is similar to your army shooting a surrendering enemy at the end of a battle, thereby ensuring that no future enemies will want to surrender and will instead fight to the death. You gain a short run benefit at the expense of destroying your reputation.

Offering him a job under false pretenses and then prosecuting him creates a big disincentive for any future hackers to a) talk to government officials who approach under seemingly benevolent circumstances and b) even want to work for the government at all if it pulls scummy moves like this.