As Lilo points out, it is possible that Michael's fingerprints were not in police databases. I've never been in the military; would Mike have been fingerprinted when he enlisted?

In any case, it seems clear that Michael was fingered (pun intended) for the killings in one way or another. Vito refers to the need to clear him of "false charges" in the film.

In the novel, of course, Vito arranges a confession from a Bocaciccio (sp?) to clear Michael. That plan makes sense if the case against Michael was based on eyewitnesses and rumors from the street. Would the police have gone along if there was strong physical evidence, like fingerprints, linking Michael to the killings? Refresh my memory: did the novel get into the details of the case against Michael?