The Scottish secretary has mounted a scathing attack on pyramid sales systems which are pushing women into the hands of loan sharks.

Helen Liddell said the Women Empowering Women scheme, through which women often hand over large sums of money in the hope of a substantially higher return, was a "cruel con".

"It is no better than a chain letter. As soon as the chain is broken, women lose money," said Liddell.

"The arithmetic of the scheme simply does not add up. The best way to protect women from this scheme is publicity."

She said the government was looking at ways to tackle "this totally reprehensible means of pyramid selling".

Women Empowering Women consists of buying a "heart" which costs in the region £3,000.

Women often club together because they cannot afford the whole amount.

They are then promised a return of up to £12,000 within five or six weeks.

Those at the very top of the pyramid make money out the scheme.

But as the pyramid reaches saturation point there are not enough people to take part. Those beyond the top levels lose all their money as the scheme goes into meltdown.

Liddell conceded that it was "a very clever scheme" but warned women not to risk getting involved.

The Labour MP John Lyons urged the Scottish secretary to work with the Department of Trade and Industry (DTI) to find new ways to combat the scheme.

"These get rich quick schemes are driving people into the hands of loan sharks all over Scotland. It is very important that we make it very clear that these loan sharks only bring fear, despair and intimidation into our communities," he said.

Liddell said the government would take action against those who were behind the scams.

"To call them loan sharks is to insult sharks. They are vermin who prey on the most vulnerable in our communities," she said.

The DTI and the Department for Culture, Media and Sport are looking into the Women Empowering Women scheme, Liddell told MPs.