THE REST OF THE AFFAIR OF KHAYBAR
Kinana b. al-Rabi, who had the custody of the treasure of B. al-Nadir, was brought to the apostle who asked him about it. He denied that he knew where it was. A Jew came (T. was brought) to the apostle and said that he had seen Kinana going round a certain ruin every morning early. When the apostle said to Kinana, ‘Do you know that if we find you have it I shall kill you?’ he said Yes. The apostle gave orders that the ruin was to be excavated and some of the treasure was found. When he asked him about the rest he refused to produce it, so the apostle gave orders to al-Zubayr b. al-Awwam, ‘Torture him until you extract what he has,’ so he kindled a fire with flint and steel on his chest until he was nearly dead. Then the apostle delivered him to Muhammad b. Maslama and he struck off his head, in revenge for his brother Mahmud. 
It is alleged from the above report by critics that Prophet Mohammad (p) tortured Kinana b. al-Rabi because he had some ‘treasure’. When Kinana was questioned about the whereabouts of this treasure, he refused to disclose the location as the pseudo report states.
This story is not found in any of our most authentic collection of Hadith. Nor is there any truth to it. This is because it is claimed in the report that Kinana was tortured with ‘fire’- this cannot be true because there are many authentic Hadith where Prophet (p) forbade torture with fire. Moreover, the Prophet (p) had everything he wished, he would never torture someone for money. As a matter of fact, the Prophet (p) was offered by the Quraish anything in the world he wanted and even would have made him leader of them as long as he stopped preaching the Message of Islam. The Prophet declined their offer. This just goes against the character of the Prophet (p). Furthermore, scholars below mention that there is no truth to the part about ‘treasure’, it is false. The reason he was killed is because he took a life unlawfully.
Scholar Shaykh Allama Shibli Numani:
GHAZWA AHZAB (BATTLE OF THE ALLIES OR THE TRENCHES)
Having left Medina and settled at Khaibar, the Banu Nadir started hatching a wide-spread conspiracy against Islam. Their leaders, Sallam Ibn Abi al-Huqaiq, Huyayy Ibn Akhtab, Kinana Ibn al-Rabi and others came to Mecca, met the Quraish, and told them that Islam could be destroyed root and branch provided they lent their support. The Quraish were already waiting for an opportunity. Assured of their help, the Jews next visited the Ghatfan tribes and made tempting offer of assigning to them half the proceeds of Khaibar in perpetuity.
1. Tabari has it thus: ‘Those whp incited the people to war against the Prophet were the leaders of the Banu Nadir who had been banished from their hands.’ The most reliable book on Maghazi is that of Musa Ibn Uqba. Hafiz Ibn Hajar, while giving details of the battle of the Trenches (Allies) in his book Fath al-Bari has quoted these words: ‘Huyayy Ibn Akhtab after the eviction of the Banu Nadir went to Mecca to incite the Quraish to fight the Holy Prophet (p). Kinana Ibn Rabi, Ibn Abi al-Huquaiq went to the tribe of Ghatfan and incited them against the Prophet the Prophet and promised to pay them half the yield of dates of Khaibar. Uaina Ibn Hisn, Ibn Hudhaifa and Ibn Badr agreed to this and they wrote to their allies, the Banu Asad and they and their followers came under the command of Talha Ibn Khuwailid…’ 
Scholar, Shaykh Allama Shibli Numani goes further:
While describing the battle of Khaibar, the history writers have committed a serious blunder in reported a totally baseless report, which has become a common place. It is said that the Prophet (p) had granted amnesty to the Jews on condition that they would not hide anything. When Kinana Ibn Rabi refused to give any clue to the hidden treasures, the Prophet (p) ordered Zubair to adopt stern measures to force a disclosure. Zubair branded his chest with a hot flint again and again, till he was on the point of death. At last he ordered Kinana to be put to death and all the Jews were made slaves.
The whole truth in the story is that Kinana was put to death. But it was not for his refusal to give a clue to the hidden treasure. He was put to death because he had killed Mahmud Ibn Maslama (also Muslima). Tabari has reported it in unambiguous words: ‘Then the Holy Prophet (p) gave Kinana to Muhmmad Ibn Maslama (Muslima), ‘and he put him to death in retaliation of the murder of his own brother, Mahmud Ibn Maslama (Muslima).’ In the rest of the report, both Tabari and Ibn Hisham have quoted it from Ibn Ishaq, but Ibn Ishaq does not name any narrator. Traditionists, in books on Rijal, have explicitly stated that Ibn Ishaq used to borrow from the Jews stories concerning the battle of the Prophet (p). As Ibn Ishaq does not mention the name of any narrator whatsoever in this case, there is every likelihood of the story having been passed on by the Jews.
That a man should be tortured with burns on his chest by the sparks of a flint is too heinous a deed for a Prophet (p) who had earned for himself the title of Rahma’lil Alamin (Mercy for all the Worlds). After all, did he not let the woman who had sought to poison him to go scot-free. Who would expect such a soul to order human body to be so burnt for the sake of a few coins.
As a matter of fact, Kinana Ibn Rabi Ibn al-Huquaiq had been granted his life on the condition that he would never break faith or make false statements. He had also given his word, according to one of the reports, that if he did anything to the contrary, he could be put to death. Kinana played false, and the immunity granted to him was withdrawn. He killed Mahmud Ibn Maslama (or Muslima) and had, therefore, to suffer for it, as we have already stated on the authority of Tabari. 
Story of Kinana’s being subjected to exhortion and put to death for hiding some treasure, for which he had contravened his contact, is altogether a spurious one. Kinana was executed in retaliation for treacheriously killing Mahmud, the brother of Mohammad-bin-Moslama, to whom he was made over for execution. There is one tradition, without any authority, to the effect, that Zobeir was producing fire on Kinana’s breast by the friction of flint and steel. This, if it be a fact, does not show that it was done by Mohammad’s direction and approval. One the contrary, there are several traditions from the Prophet himself in which he has forbidden to punish any one with fire. It is related by Bokharee from Ibn Abbas, that Mohammad said, ‘God only can punish with fire.’ It is also related by Abu Daood from Abdullah, that the Prophet said, ‘No body ought to punish any one with fire except the Lord of the fire.’ 
Hajjah Amina Adil:
… Oh Travel on the Way of Truth! While this is historica ltruth, there are some historians who, though they have no knowledge of the real course of events, nonetheless assert that in the lifetime of the Prophet a certain Kinana (the husband of Safiya) had hidden a great treasure. (This had belonged to the Bani Nadir who had fled to Khaybar after the Battle of the Trench). They claim that in order to procure wealth for themselves, the Muslims tormented Kinana and put his whole family to death. However, this is a fabrication. For one thing, Kinana was the murdered of Muhammad (Mahmud) bin Maslama, and he was put do death in retaliation.
It is simply not true that his whole family was punished by death, for his own brother was still alive in the of Umar’s Khalifate. The Holy Prophet never permitted any person to be tortured for the purpose of procuring information. 
Reading the above shows that Kinana was involved inciting the Quraish against the Muslim community and that he took an innocent life. Hence, he was killed for it.
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 Ibn Ishaq – Siratu Rasulillah – (Translator: A. Guillaume), page 515
 Sirat -un- Nabi By Shaykh Allama Shibli Numani, volume 2, page 106
 Sirat -un- Nabi By Shaykh Allama Shibli Numani, volume 2, Page 173 – 174
 A Critical Exposition of the Popular Jihad (Original 1885) – By Cheragh Ali, page 95 – 96
 Muhammad, the Messenger of Islam: His Life & Prophecy By Hajjah Amina Adil, page 449 – 450
Narrated Abu Huraira:
When we conquered Khaibar, we gained neither gold nor silver as booty, but we gained cows, camels, goods and gardens.
= No such a treasure.