Officers raided a makeshift factory where it is alleged crooks were churning out up to 1,000 counterfeit coins a day.
Cops suspect the forgers were planning to circulate the fakes during the Olympics — when the capital will welcome millions of extra visitors.
City of London Police found a smelting machine, ingots of metal and moulds for £2 and £1 coins in a rented room in an office block. Just 300 yards away, officers also raided a scrapyard hidden behind a wall of tyres where the coins were coloured with gold spray paint.
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