Government officials today spoke with Kiwi "Dambusters" veteran Les Munro to reassure him that it "understood and respected" his motivation to sell his war medals, but it could still block the auction later this month.
Mr Munro, 95, is the last survivor of the pilots who took off for the attack on German dams, later immortalised in the film The Dam Busters.
One of only two New Zealanders to take part in the World War II raid, he has put his medals up for auction in the UK to raise money for the upkeep of the Bomber Command Memorial in London that commemorates his comrades who were killed.
London auction house Dix Noonan Webb said the medals could fetch 40,000-50,000 pounds (NZ$81,400-$101,700) at its March 25 auction.
The money will go to the Royal Air Force Benevolent Fund, guardian of the memorial at Green Park in London that commemorates all the 55,573 dead of Bomber Command, including 1679 New Zealanders.