Overseas victims were tricked into sending money to invest in a business which used the Metropolitan Police as a cover, including a 69-year-old American woman who was conned out of £140,000 ($220,000/€169,000), according to detectives from Scotland Yard's Operation Podium.

They have been working alongside United States law enforcement agencies to try to crack the online scam which involved an alleged contract to supply buses for police officers for the Games.

Police believe initial contact with the victims is made via an online dating website, following a well known pattern which law-enforcement authorities across the world have seen emerging.

Once befriended, the fraudsters claim that they need to pay "initial costs" of fulfilling the contract they had "won" to supply transport for the Metropolitan Police during the Olympics and Paralympics.

Promises to repay the money at a later stage are made.

The 24-year-old, from Forest Gate, East London, was arrested for fraud by misrepresentation and is currently in custody at a central London police station.

A 49-year-old man and a 39-year-old woman who were arrested in December have been bailed to return to a North London police station in late March pending further inquiries.

Detective Superintendent Nick Downing said: "We are concerned that fraudsters have been using the name of the Met to foster increased levels of trust in their victims.

"Would-be fraudsters should be warned that we will investigate attempts to defraud the public in this way tirelessly.

"At the same time we would urge the public across the world not to fall victim to these or any similar schemes.

"You can protect yourself by following the advice recently published on the Met's Fraud Alert website about just this type of crime, and if anyone attempts to obtain money from you in a way you suspect is fraudulent, report to police or via the Action Fraud website." 

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