"We have withdrawn the contract offer to Stevland Angus because I thought there were too many red flags," manager Brian Laws told the Scunthorpe Telegraph.
"He had done well for us while he was here, but had a lot of baggage which I feel would have made him high maintenance.
"That has scared me off because I think we were going in different directions.
"But I want to place on record my thanks to Stevland for his services. He is still carrying an injury but I wish him well in his pursuit of another club."
Angus has been released by his parent club Cambridge.