The State Department has shut down the office of its special envoy for the closure of Guantanamo Bay, a US official said Monday, in a sign of the fading hopes of shuttering the jail.

Daniel Fried, the special envoy in charge of the dossier, will now move to coordinate the State Department's sanctions policy, including for Iran and Syria, and his "former responsibilities will be 'assumed' by the office of the department's legal adviser," The New York Times reported, citing an internal personnel memo.

A US official, who asked not to be named, told AFP that the story, which specified that Fried would not be replaced, was "accurate."

Fried, a veteran diplomat and former ambassador to Poland, was appointed special envoy in May 2009, only months after US President Barack Obama ordered the notorious jail at the US naval base in Guantanamo Bay, Cuba, to close.

In a declaration in late 2009, Fried said his job was to engage in "diplomatic dialogue with foreign governments concerning the repatriation and/or resettlement of individuals" held at Guantanamo.

On his first day in office in January 2009, Obama signed an executive order the prison camp should close, in a bid to fulfill one of his campaign promises.

But his plan was thwarted when some countries were reluctant to accept the return of their nationals and when US lawmakers banned the military from transferring prisoners to the United States for trial or sending them abroad.

Fried said in his 2009 declaration that his main job was to find places for those held in the jail who had been cleared for repatriation or resettlement to third countries.

He said he had been guided by US policy that it would not repatriate people to countries where they were likely to face torture.

Of the 779 inmates who passed through Guantanamo only nine were ever convicted or brought to trial, and of the 166 who remain, 55 are considered safe to be released by the US military, but have nowhere to go.

The news of the State Department's move came as hearings into the case Khalid Sheikh Mohammed, the self-proclaimed mastermind of 9/11, and his four alleged co-plotters resumed at the military tribunal in Guantanamo Monday.

The men were seen at the hearing for the first time since it was suspended in October.