Police believe they have broken up an organised crime gang suspected of stealing second-hand clothes left out for legitimate collectors.
Four people were arrested after 30 police officers surrounded a depot in Rainham, Essex believed to be the hub of an international crime network.
Two men were arrested on suspicion of fraud and money laundering. Another two men were arrested at other properties in Essex and south east London.
Police seized £20,000 in cash, along with charity bags, computers and correspondence.
It is believed that the gang was stealing full textile charity bags left out for legitimate companies, as well as printing their own collection bags masquerading as a genuine company collecting for charity.
Charity bag fraud is blighting the textile recycling industry, as organised gangs dupe householders into believing they are donating unwanted clothing to charity. In reality, the gangs are selling on the clothing and profiting from high-valued items.
It is estimated to cost the third sector up to £50m each year.
City of London Police Commander Ian Dyson said: “Charity bag fraud threat is a serious criminal threat stealing millions of pounds from those who help the most vulnerable in society, both at home and abroad.
“Today’s operation highlights how police forces and charities are sharing intelligence with the National Fraud Intelligence Bureau to identify and then dismantle the criminal networks who continue to steal from our streets to sell on high streets across Eastern Europe.
“Investigating this type of criminality is a major priority for the City of London Police, and those who continue to offend should expect our officers to come calling sometime soon.”
Textile Recycling Association (TRA) national liaison manager Alan Wheeler said: “Bogus Charity Collectors and criminal gangs that steal clothing from door to door collections and clothing banks are an increasing problem. The TRA was the first to instigate collaborative action with the City of London Police back in 2010. This has culminated in the setting up of the intelligence gathering process which has lead to these arrests.”
According to a report in The Times, the gang is suspected of co-ordinating 30 vans to steal clothing. It claims undercover officers monitored the raided warehouse for weeks, witnessing hundreds of vans of clothing being delivered. This material was then apparently sorted and packed into shipping containers bound for Eastern Europe.