Up to 52 children may have been victims of a sex abuse scandal in Greater Manchester, with most offenders getting away with their crimes because of errors by police and children’s services, the Guardian has learned.

Some of the police officers involved in the 2004 case are still serving and the police watchdog has been called in to re-examine if there was any wrongdoing.

The revelations came as an independent report found that the police investigation into child sexual exploitation failed vulnerable girls in care after being shut down prematurely — partly because senior officers prioritised solving burglaries and car crime.

Operation Augusta was launched in 2004 by Greater Manchester Police (GMP) following the death of 15-year-old Victoria Agoglia, who died of an overdose in 2003 after being injected with heroin by a 50-year-old man.

The report was ordered by Andy Burnham, the mayor of Greater Manchester, and released on Tuesday morning. It found failings by police and children’s services.

Greater Manchester police assistant chief constable Mabs Hussain said that victims attacked as children had been denied justice. He said that detectives reinvestigating the allegations from those who say they were sexually abused as children in the original investigation have identified many more suspected victims.

He said that further lines of inquiry were being pursued in 38 of the 52 cases to have come to light, with new alleged attackers in some cases.

“There are lines of inquiry we have established into further offenders and victims,” he said. “The chief [constable of GMP] wanted assurances … that any lines of inquiry from 2004 should be pursued and the justice [victims] were denied in 2004 should be obtained.”

The report found that although Augusta identified 16 child victims and 97 potential perpetrators — mostly men working in the restaurant trade — only three were convicted at court.

The operation was shut down prematurely in July 2005, with the force blaming a lack of resources. As a result, most of the affected children — white girls aged 12 to 16 in care in Manchester — were “failed” by police and children’s services, the authors concluded.

Despite this, the entire investigation team received commendations from the chief superintendent and was nominated for a force excellence award, according to the new report, written by child protection specialist Malcolm Newsam and former senior police officer Gary Ridgway.

Hussain denied any suggestion that the original inquiry was inadequate because offenders were mostly from an Asian background: “There was no suggestion that there was any fear, from the evidence I have seen.”

GMP responded on Tuesday by apologising to the victims and saying it had established a major investigation team to look again at the abuse of Victoria and the other girls.

The report suggested GMP failed to learn lessons from the curtailed operation, noting that nine years after Victoria’s death, nine Asian men in Rochdale were found guilty of sexually exploiting vulnerable young white girls. Burnham commissioned the research after Margaret Oliver, a detective on the Augusta team, went public criticising GMP in the aftermath of the Rochdale case.

“Don’t believe any of this rubbish that police have learned from their mistakes. I worked on an almost identical operation in 2004, Operation Augusta, which had identified dozens of young victims and dozens of suspects. ” she said in a media interview in 2017.

Margaret Oliver worked as a detective on Operation Augusta Photograph: Chris Renton Photography

Oliver claimed she returned after a period of leave and found the operation had been closed down. She said she was never given a satisfactory reason why, but speculated that GMP was obsessed with solving acquisitive crime, such as burglary, at the time. The new report found evidence for this assertion, saying GMP at the time had “a heavy focus on performance-driven targets based on the government’s priority offences: vehicle crime, domestic burglary and robbery.”

Operation Augusta identified various restaurants and takeaways in south Manchester where suspects were employed. Intelligence suggested that offenders were targeting care homes within the city of Manchester area, particularly one home used as an emergency placement unit for children entering the care system, which the report authors said “maintained a steady supply of victims” for the perpetrators, who befriended the girls as soon as they arrived.

The authors of the report concluded: “There was significant information held by both Manchester City Council and Greater Manchester Police on individuals who potentially posed a risk to children, but we can offer no assurance that appropriate action was taken to address the risks they presented to children. There were very few criminal justice outcomes resulting from Operation Augusta. Fundamentally, Operation Augusta failed to meet the original objective of tackling the widespread and serious sexual exploitation of looked after children.”

They also noted “fundamental flaws” in how Operation Augusta was resourced, and say that this had a significant negative impact on the investigation strategy and the way in which it was ultimately terminated.

“Within a few weeks of the outset, the team was insufficiently resourced to meet the demands of the investigation and ownership of the operation was problematic,” they wrote, concluding: “Fundamentally, we believe, from the evidence that we have seen, that the decision to close down Operation Augusta was driven by the decision by senior officers to remove the resources from the investigation rather than a sound understanding that all lines of enquiry had been successfully completed or exhausted.”

Joanne Roney, chief executive of Manchester city council, said: “This report makes for painful reading. We recognise that some of the social work practice and management oversight around 15 years ago fell far below the high standards we now expect. We are deeply sorry that not enough was done to protect our children at the time.

“While we cannot change the past we have learned from it and will continue to do so to ensure that no stone is left unturned in tackling this abhorrent crime.”

Hussain said that GMP, Britain’s third biggest force, had 56 ongoing hunts for child sex abusers with 244 victims and 317 alleged offenders. A total of 21 of those investigations were classed as historic.