The investigation launched last August into the administration of the prison could lead to criminal proceedings being initiated against staff, The Times has learnt.

The inquiry report does not give names but it highlights serious irregularities in the way prison leave was granted to certain inmates and cites a series of financial transactions, particularly those made through the tuck shop - a main hub of commerce in the prison.

Emmanuel Cassar, the chairman of the inquiry board and a former prison director, confirmed the information but would not comment further, saying the inquiry findings were being assessed by the Police Commissioner and the Attorney General.

The Home Affairs Ministry said in a statement that the board investigated in detail transactions made between detainees, payments from a private company for work done by inmates and the presence of mobile phones in prison.

The statement said the report brought to light "maladministration and mismanagement" and called for disciplinary action to be considered against those responsible.

The investigation was launched following a report in The Sunday Times which revealed that Dutch inmate Perry Toornstra - who was at the centre of allegations of abuse by prison guards after an escape attempt in August - used prisoner Leli Camilleri, known as Il-Bully, as an intermediary to help him obtain prison leave.

Prison director Sandro Gatt had admitted as much and resigned but denied any wrongdoing.

The inquiry report has not yet been published but the ministry has released a set of administrative recommendations made by the inquiry board, which included former UK Defence Ministry official Martin Scicluna and psychologist Marianne Agius.

The recommendations deal directly with Mr Camilleri's position as prison representative, saying this system should be comprehensively reviewed because whoever acts as representative has to behave "within more limited responsibilities".

The report also calls for an end to "preferential treatment" on prison leave given to some inmates.

Other inmates and a prison guard, who spoke on condition of anonymity, had given The Sunday Times a similar picture to that of Mr Toornstra, insisting that Mr Camilleri "runs the show in prison".

Former Prison Board chairman Mario Felice, who resigned over a professional dispute with Mr Gatt three months before this matter came to the fore, had corroborated this.

"Certainly Mr Camilleri leads a very prominent role in the prison. He enjoys a lot of things which others do not, including access to the prison director... I don't want to elaborate further, but when I was active in the prison until very recently many prisoners were denied certain possibilities, only to gain them through the intervention of this individual. I don't think I need comment further on whether that is healthy," he had said.

The ministry said it was in the process of setting up a compliance unit which would make sure the recommendations were put in place.

Among the most salient measures are those concerning the presence of drugs in prison. The recommendations here vary from general calls for beefed up security at the entry points and "vulnerable areas" like the bakery, the chapel, education room and the gym, to more specific measures such as stepping up drug testing to a monthly sample of five to 10 per cent of the prison population.

Another seemingly simple measure, which could solve a chronic problem, is the installation of equipment which would block mobile phone communications. Despite the security, it is common knowledge that there are prisoners who have personal phones in prison, which allows them to have uncontrolled conversations.