http://www.thisislondon.co.uk/stand...d-over-collapse-of-crown-currency-exchange.do Lucy Tobin Lucy Tobin 07.12.10 * Poll: Should victims be reimbursed by the taxpayer? Two men were today arrested by police investigating the collapse of foreign exchange business Crown Currency Exchange. The men, aged 68 and 70, are thought to be Peter Benstead and Edward James, the bosses of CCE, which went into administration in October owing more than Â£16.5 million to 13,000 customers. Detectives from the economic crime department of Devon & Cornwall Police, who made the arrests, searched several addresses in Cornwall and Glastonbury today. Detective Inspector Paul Bean, of the area police's serious and organised crime branch, said: âIt is expected that this will be a protracted enquiry that may take many months. It is anticipated that there are approximately 13,000 victims.â More than 8000 victims of Crown's collapse have so far lodged claims, with some losing up to Â£400,000. Crown would pay new customers using funds taken from existing clients. The money was not held in segregated customer accounts or listed in the company's financial reports. Questions have been raised over the actions of the Financial Services Authority in the case, with critics complaining that it failed to properly monitor the internet business. Crown was registered with the FSA as a âsmall payment institutionâ and so able to use the watchdog's logo on its website while only receiving so-called âlight touchâ regulation. Qualifying companies are supposed to have average monthly transactions of less than Â£2.5 million. Crown, however, was boasting of a Â£200 million annual turnover in July. In addition, no one running a âsmall payment institutionâ is supposed to have convictions relating to financial crimes. But Benstead, 68, was convicted of theft in 1980 and given a two-year suspended sentence. He also presided over a stream of business collapses during his career, including a windows and conservatories company which led to his being banned from being a director by the Department of Trade and Industry in 1998. Two months before Crown's collapse, Benstead bought a Â£945,000 home on which MCR has put a caution note to investigate how it was purchased. James, 70, an ex-mayor of Glastonbury, was chairman of Mendip District Council until Crown's collapse, when he said he would step down for three months to protect the council's reputation. Documents filed at Companies House days before Crown went under suggest James had quit as a director nine months earlier. But MCR said he attended meetings and signed company bank accounts until the day Crown collapsed.