Two people have been arrested by counter-terrorism officers after an investigation into a suspected charity fraud.

West Midlands Police said a 38-year-old man and a woman aged 49 were detained at an address in Birmingham on Wednesday.

The arrests, resulting from an examination of evidence recovered during searches in September last year, are linked to an investigation by the Charity Commission into the Sikh Youth UK organisation.

The force said the arrests were "in connection with alleged fraud offences of donated charitable funds".

The West Midlands counter-terrorism unit has been "working closely" with the Charity Commission on the investigation, police added.

The commission said it had opened "a statutory inquiry into funds held by and raised in connection with the organisation".

In October 2018, police raised concerns with the independent charities' regulator, relating to the organisation's receipts and use of donations.

In response, the commission obtained copies of bank statements, and analysis identified what it called "a number of regulatory concerns which warrant further investigation".

A formal inquiry was opened on November 15 last year.

A spokeswoman for the Charity Commission said the inquiry was examining whether the organisation's bosses properly administered donations, trustees' conduct, its partnerships with other charities, and its financial management.

She added: "The inquiry will also examine the organisation's status in order to determine whether it is a charity in law.

"Those running the organisation have not applied to register with the commission."

The independent regulator added that although Sikh Youth UK is not a registered charity, the commission has jurisdiction as the funds were charitable.

By Richard Vernalls