An official investigation into the firm by the Companies Investigations Branch (CIB) of the Department for Business, Enterprise and Regulatory Reform has been completed, Gareth Thomas said.

In a written Ministerial statement, Mr Thomas said the CIB was now taking independent advice on whether the evidence in its report warranted legal action.

He said: "The collapse of Farepak was dreadful for the thousands of people who lost money. The Government is working hard to prevent other families suffering similar problems in the future.

"We initiated a comprehensive investigation to establish the facts. We are now getting legal advice on whether there are grounds for further action."

The report is subject to limited disclosure and will not be published.

But Mr Thomas said: "If proceedings are taken against any party involved, this will become public knowledge if or when the case reaches open court. We will do everything in our power to process this quickly."

The investigation had taken longer than expected to complete because it involved gathering information from Farepak and other companies which were in administration.

Mr Thomas added: "The report is over 700 pages long and could lead to court proceedings so taking short cuts in the investigation was not an option."

Some 150,000 families lost about £40 million savings when the Swindon-based firm went into administration in October 2006. Creditors, including customers, are expected to get about 5p in every pound returned.