The Big Spring Herald reports that the Texas Ethics Commission dismissed the complaint due to insufficient evidence.
Duncan was accused of accepting illegal campaign donations from corporations during his 2010 mayoral campaign.
However, Duncan said he never personally received or deposited the checks in question.
In a statement, Duncan added that the signatures on the "Deposit Only" notation on the back of the check weren't made by him.
Big Spring City Councilmen Glenn Carrigan and Marcus Fernandez were recently fined $200 each for similar violations.