A man and woman from Sussex were among 11 people arrested after a police investigation into animal rights campaigners.
National Crime Squad officers swooped on eight addresses round the country yesterday.
It is understood suspects were defrauding a Government department and using the money to finance animal rights campaigns.
Tens of thousands of pounds have been fraudulently obtained and misused.
The 30-year-old Brighton man and 26-year-old woman from Haywards Heath were being questioned by police last night, along with suspects from Northampton, Bolton, Manchester, Wigan and Tugby in Leicestershire.
The Argus has learned fraudsters were granted money from the Department of Education's Individual Learning Account Programme, to teach skills.
No teaching ever took place and both applicants and their supposed students shared the cash.
Neil Giles, Assistant Chief Constable with the National Crime Squad, said: "Yesterday's activity marks a new era by targeting those believed to be some of the key players in animal rights extremism.
"What we have uncovered we believe is an example of crimes used to further sometimes very violent and dangerous protests."
"We have received excellent support and assistance from our colleagues at Northamptonshire, Greater Manchester, Sussex and Leicestershire police forces."
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