Three Stockport men has been arrested in connection with a £2m VAT swindle in dawn raids carried out by HM Revenue & Customs.

HM Revenue and Customs (HMRC) have confirmed that criminal investigators arrested four people from Cheshire during a series of raids.

An HMRC spokesman said all four were detained following dawn raids on two Cheshire properties last week. Cheshire Police were involved in the arrests.

HMRC said a total of 12 people had been held across Britain in connection with stealing more than £2m in a major VAT repayment fraud linked to the construction industry.

Three men from Stockport were arrested and four held in Cheshire, including one from Macclesfield.

During the dozen raids - in Cheshire, Manchester, Suffolk and Staffordshire - live ammunition, CS spray and an imitation firearm were seized.

Adrian Farley, assistant director of criminal investigation for HMRC, said: "Today's arrests are a result of many months of investigation across the UK to unravel what is believed to be a major fraud."

All 12 people arrested have been bailed until June.