The Home Office suffered a "collective failure" to recognise the significance of a backlog of records of Britons convicted abroad, a report has found.
The home secretary said he was not notified about the file backlog
The inquiry said ministers were not told about the failure to update police computers over a 10-year period.
The report was launched after the discovery of a backlog of 27,000 cases, including hundreds of serious offences.
The Home Office said it had lessons to learn but critics said ministers should take responsibility for the problem.
Shadow home secretary David Davis dismissed the report and accused ministers of being aware of the seriousness of the problem.
"The fact that they failed to ask any further questions, the fact that they failed to do their job is a matter of their responsibility," he said.
The inquiry was commissioned by the department's Permanent Secretary, Sir David Normington, after it emerged that details of 27,529 cases were left in files at the Home Office.
These included 540 serious crimes such as rape, murder and robbery which were not entered onto the Police National Computer.
Home Secretary John Reid and his ministers had claimed they were not notified about the case files which were left unprocessed for a number of years.
The report concluded that officials did not warn ministers because they did not realise the significance of information sent by police forces from Europe and Turkey.
Home Office senior personnel director Dusty Amroliwala, who headed the inquiry, said the lack of action was "difficult to understand and very regrettable".
"I have found no evidence that the existence of the accumulated records or their content were brought to ministerial attention at any time prior to 9 January 2007," he said.
There had been a significant number of opportunities for officials to tell ministers of the problem, he added.
But plans to inform ministers were "diverted" on at least two occasions in the previous six months, because of other events and "an absence of lateral thinking" by civil servants, the report said.
Eventually, the Association of Chief Police Officers (ACPO) was paid to enter the data into the national police computer and the extent of the problem became clear.
An ACPO official wrote to the Home Office in October 2006, and the same month Adrian McAllister, the acting deputy chief constable of Lancashire Constabulary and the ACPO lead for criminal records, wrote to Tony McNulty, the Home Office minister, the report said.
Mr McNulty has denied ever seeing the letter. His junior Joan Ryan replied to Mr McAllister six weeks later.
But the report said the home secretary and ministers were not aware of the backlog until January.
Sir David welcomed the report but said the department had already moved on from the "picture painted in the report".
He said he was "determined that we should learn its lessons" and there were new measures in place for assessing risks to the public and informing senior managers and ministers.
"And we now need to go further and faster to achieve greater accountability, better performance and higher standards in every part of the Home Office," he added.
The FDA, the union for senior public servants, said it welcomed the report which provided "a balancing context" to how the backlog arose.
But the Conservatives' David Davis said the report had been more about media management than managing the problem.
"It was written by a middle-ranking civil servant. How can someone criticise not just his boss but his boss's boss?"
Liberal Democrat home affairs spokesman Nick Clegg criticised Mr Reid's leadership of the department.
"Things are only put right when things reach crisis point and we have a political leadership at the Home Office now which is trying to distance itself from its own department altogether."
A senior Home Office official remains suspended, and his case will be dealt with in the next few weeks.