Free prisoner inside not punished (10)

I believe the answer is:

unconfined

'free' is the definition.
(similar in meaning)

'prisoner inside not punished' is the wordplay.
'prisoner' becomes 'con' (abbreviation for 'convict').
'inside' means one lot of letters goes inside another.
'not' becomes 'un' (prefix meaning 'not').
'punished' becomes 'fined' (similar in meaning).
'un'+'fined'='unfined'
'con' placed within 'unfined' is 'UNCONFINED'.

(Another definition for unconfined that I've seen is " released".)

I've seen this clue in the Sydney Morning Herald.

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