The extent of the fraud was at first thought to be around £5m, but this figure was yesterday revised to around £7m following the seizure of more stolen cheques.

Police this week arrested 17 people in connection with the fraud. The majority of arrests followed raids on homes in Leeds but there were others in Wakefield, Barnsley, Harrogate, Manchester, Luton in Bedfordshire and Milton Keynes, Buckinghamshire.

The majority of those arrested are believed to Zimbabwean nationals. Detectives are checking with the Immigration Service to see if those arrested are in Britain legally.

More than £2m worth of the commercial cheques had been successfully cashed by the criminals over 18 months, police said.

Officers from West Yorkshire Police's Economic Crime Unit launched the operation following months of painstaking investigation work after being alerted by financial institutions that cheques were going missing.

It is believed that a number of employees within banks or buildings societies helped the gang and cheques had been stolen from mailrooms and were from commercial organisations.

The investigation centres on a fraud involving high-value cheques stolen from financial institutions over the last 18 months. The details on the cheques have been altered, the cheques paid into accounts and cash drawn out later.

The amount involved in the fraud was initially assessed to be around £4.8m , but during the operation hundreds of cheques with a face value of about £2m were recovered at some of the addresses, taking the tally nearer to £7m.

Hundreds of other blank cheques were also seized along with computers, printers and other equipment believed to be linked to the fraud.

Those detained during the initial arrest operation, which began on Tuesday, were arrested on suspicion of theft and fraud offences.

Those arrested so far are 16 men and one woman, aged between 25 and 47.

Six of the arrested men have now been charged with fraud offences. Three are from Leeds, one from Barnsley, one from Wakefield and one from Manchester.

The other people arrested have been bailed pending further inquiries.

Det Chief Insp Paul Langan, head of the Economic Crime Unit, said: "This operation demonstrates West Yorkshire Police's ongoing commitment to targeting large-scale fraud that is being carried out by organised crime gangs.

"Throughout this investigation we have worked closely with our partners in the banking community and we continue to develop ways of working even more closely to keep targeting organised criminals who think they can get away with profiting from financial fraud

"Our message to those people is, as this week's operation demonstrates, we will investigate you, you will be arrested and we will also strip you of any financial benefit you have made from these crimes.

"It is also worth highlighting that this investigation came about as a result of the financial institutions' own internal security systems identifying this criminality orchestrated by an organised gang."