Former detective senior sergeant Cameron Blaine was among the officers who found the four-year-old at abductor Terence Kelly's home in northern WA on November 3, 2021.
He shot to fame when footage went viral of him asking Cleo her name, 18 days after she went missing, to which she responded: "My name is Cleo."
West Australia's corruption watchdog released its report on Thursday, making a finding of police misconduct against Det Blaine.
The commission said the former officer leaked to the 22-year-old journalist multiple times when the pair began an intimate relationship in the days before and after Cleo Smith was found in November 2021.
"During (the operation) journalists and reporters for both print and electronic media were lodged in motels and other places in Carnarvon, as were police (and) members of each socialised together on occasion," the report said.
The pair then continued an intimate relationship until February 2022, when Det Blaine leaked sensitive information about the investigation into Cleo Smith's abduction.
This included the behaviour of persons of interest, the route taken and previous offending by Kelly, and Cleo's missing sleeping bag.
He also told the journalist about particular "police investigative methodologies" and threats that had been made against members of the force.
The commission found the journalist had done nothing wrong and the blame was on Det Blaine.
"The relationship was unwise, she is young, in the early stages of a career as a journalist. It is her job to ask questions and seek out information," the report reads.
"DSS Blaine had an obligation to keep matters confidential and failed to do so.
"Fortunately, for the most part, (the journalist) recognised the material was sensitive and did not use it."
The watchdog found he released the information for his own benefit in maintaining a relationship with her. It also found he had previously leaked other information about investigations to journalists.
After sending information to a different journalist about an apparent murder-suicide, he sent her a message proving he knew his actions were "improper", the watchdog found.
"Do you have Signal? All the messages going through the phone exchange to a journalist is going to cause me grief lol," the message read.
Det Blaine was also found to have used police vehicles 62 times for non-police purposes.
On several occasions, he drove the car to different women's homes or to the pub and stayed for several hours.
Det Blaine resigned from the WA police force on Wednesday ahead of the report's release.
After being praised for his central role in reuniting Cleo with her family, he was stood down in September last year amid a Corruption and Crime Commission investigation.
A WA Police spokeswoman on Wednesday confirmed to AAP that Det Blaine's resignation had been accepted.
Cleo was taken on October 16, 2021 from the remote Blowholes campsite, 75km north of the town of Carnarvon, where she was later found.
Kelly had gone to the campsite, 960km north of Perth, looking for items to steal but made the opportunistic decision to take Cleo, whose parents were sleeping nearby.
Her disappearance sparked a major police investigation which eventually led detectives to Kelly's property, which was just minutes from Cleo's family home.
Officers forced entry and found her alone in a room, playing with toys.
Kelly later admitted abducting the girl while high on methamphetamine and was sentenced to at least 11-and-a-half years behind bars.
