Businessman Roger Tuckett, who is campaigning on behalf of learning providers, has written to the Parliamentary ombudsman calling for an investigation into the handling of ILAs, closed in November amid allegations of fraud.

“It would appear that Government PR departments played an active role behind the scenes creating a climate of public opinion which diverted attention away from its own failings,” says the complaint.

“The Government’s action in curtailing the scheme shows all the signs of a cover-up, seeking to evade responsibility for failing to implement a major funding scheme with an acceptable level of control.”

The ombudsman’s office says it has received two complaints from providers, including Mr Tuckett, and two from students, all against the Department for Education and Skills. These are being “screened” to decide whether they should be investigated.

Mr Tuckett, leader of a group of disgruntled providers which formed after the ILA scheme was shut down, claims they were unfairly exposed to risk as a result of what they see as Whitehall’s mishandling of the accounts.

He is winding up his own not-for-profit company which was mostly reliant on ILA business.

“I hope that if compensation is considered, they will think in terms of compensation for the industry as a whole and not just those who have complained,” said Mr Tuckett.

One person has been charged with fraud and more than 30 have been arrested as police continue their investigations.

“There has been no attempt to divert attention,” said a DFES spokesman. “The scheme was first withdrawn in October due to concern about the mis-selling of ILAs. This had a clear effect on the number of accounts opened and on the total cost of the programme. It was closed with immediate effect on November 23 following new evidence of serious fraud and theft.”