The collapse of MG Rover will now come under the scrutiny of the Serious Fraud Office following Lord Mandelson's review of an unpublished independent four-year inquiry by BDO Stoy Hayward.
The car manufacturer fell into administration in 2005 when a government attempt to rescue it failed.
In an earlier report, administrators PricewaterhouseCoopers found no evidence of fraudulent activity.
Since then the Department for Business has spent more than £14.8m in costs for an independent investigation into MG Rover's demise. BDO's controversial costs during the investigation included disbursements related to expenses for hotel and other costs for the investigation team. The firm is understood to have handed its findings to Mandelson but it is unclear as to whether the business secretary will publish these before the SFO's investigation is complete.
Mandleson said that he had an 'obligation' to hand over the case to the SFO following the four-year investigation.
But a spokesman for the 'Phoenix Four' - the four directors of MG Rover at the time of its collapse - said that the latest move by Mandelson is being used as a 'ruse' to delay his findings which is critical of the government, reports the Financial Times .
The spokesman said that drawing the SFO into the case is 'the only way that the government can avoid publishing a report that is likely to be critical of government'.Mandelson declined to comment on the matter.
He is expected to inform parliament later today of the details of the SFO's investigation into the matter.