research process - How to speak to advisor about hiring an unscrupulous student?

Here is the thing. I am working in an lab under a new assistant professor of HCI and our lab itself is just two years old. We had an masters student graduating earlier and I am the second masters student from the lab to have finished my dissertation. We also have an PhD Candidate working in there. So at present we are just two GRAs in the lab.

To help us out with some programming, we hired two students on an hourly basis. My advisor is not into micromanagement; hiring students and asking for an update just a week before deadline and placing a heavy trust on those students and till now it has worked fine.

I was asked to manage this student who is severely incompetent to say the least. They had developed, with 4 other students, an undergrad project which was shown to demonstrate the necessary skills, although I highly doubt that they did any work on that project. When we asked them to program an app, they could not do it so they went to another lab and made the GRAs there develop the app for them. The code was so horrible that I had to rewrite the whole program just before the deadline. I brought this to my advisor's attention and the response was they will fire both of them and asked me to stay back for one semester to help out with transition.

I am pretty good at what I do and have a stellar reputation in my department. Despite multiple requests from my advisor, I said I don't want to spend one more semester in the lab since I can earn much more by getting an industry job.

What my advisor doesn't know is that when the new student was working, instead of developing the app on the tablet, he installed games on it and kept the tablet in his home for a month. This caused some hardships to the other new hire in the lab who could not complete the programs on time. Whenever I asked for the return of the tablet, the reply was that they came to lab but nobody was there. We were actually there in the lab during the whole time it was claimed to have attempted to return it. I was busy with interviews so I never bothered to tell my advisor about this.

At end of December, out of desperation she hired the student she said she would fire and sensing desperation they asked for GRA, saying they are interested in having a dissertation. My advisor agreed reluctantly. I came to know about this only last week when I called to find out what they were doing in the break. They sheepishly told me that my advisor was a fool and they were not really interested in a thesis but only in getting a free ride through college though being a GRA.

I am worried they will not do any work and pay other people to write programs and a dissertation for them. One bad apple can destroy the work environment in a lab. So I finally emailed my advisor and asked if they can promise me an full time job by April, I will stay back and help out in the research. I have also asked for an appointment to discuss an important matter of the new student.

I think my advisor has already given him the commitment, but how can I convince them to drop this student? I have worked in my lab for a year and a half. I deeply care about the lab, and I don't want that student in there. What will be best way to approach my advisor about this?

UPDATE:

I spoke with my advisor yesterday and said in no uncertain terms that they are not into micromanagement and this student will screw up her lab after I leave, they will never realize it and the will pay somebody else to write their thesis and the advisor's career will be on the hook. I promised that if the advisor find me the best student from class, I will teach them how to do basics of programming so that there will be smooth transition once I leave. According to that new student, she asked them to meet and said that she has no funding and it will be difficult for them to do a thesis without funding and suggested trying other departments, and asked to meet after a further week. Kind of indirectly telling them to leave.

What I am not able to understand is when I asked my adviser yesterday it was said to me that it was never offered for the student to do a thesis with but I am pretty sure it was agreed to work with that student when with them before the break. The new student was super confident about the fact that he will get funding for a thesis.

So can anybody please enlighten me as to why my advisor would lie to me here? Why would the advisor lie to me that they didn't offer a thesis when I see they pretty well did, I mean I am just an student, right? Are they embarrassed by their mistake and that's why they're not admitting it?