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Currency pattern Crown Edward James (right) was arrested by police in Cornwall and Devon week last picture: SWNS

The Sunday Telegraph can reveal that the FSA is now in discussions with the Treasury Board on possible amendments to the financial to companies such as state changes under strict supervision regulations.

The FSA has received three separate warnings about the company, including Cheshire police. Although the details of reports are unknown, in each case the FSA finds concerns did not entered its powers or abandoned the question after contacting the company.

In October, currency of the State made in administration of 16 million pounds of its customers. Last week its founders and main shareholders, Peter Benstead and Edward James were arrested by the police in Cornwall and Devon and subsequently released on bail of the police on July 12, pending further investigations.

Exchange of foreign currency are not automatically regulated by the FSA. Companies such as the motto of the State may register with the FSA, allowing them to exercise its logo on their Web site or promotional documentation, but do not have to be authorized. The distinction is crucial oversight that enterprise and protection of clients.

Complaints received by the FSA on the date of the currency from the State to 2006 when Cheshire Police contacted the regulator. In the Sunday Telegraph correspondence the FSA concluded that "no state change activities fell within our jurisdiction at the time" after referring the matter to his unauthorized in the enforcement division sales team.

The FSA receives an anonymous complaint in August 2009 and a letter in January this year of an employee of a rival firm changes.

The FSA concluded: "In all three cases, in our judgment, there was sufficient evidence to take supervisory measures."

This will provide little comfort to 8000 Crown currency creditors due up to ￡ 400,000.

However, a letter from a Director of the FSA to a creditor of the currency of the State last week said that it is in discussion with the Treasury Board should adopt a law to regulate these companies. "We are discussing what lessons could be drawn from the failure of the CEC with Treasury Board and determine if changes in legislation that may be made to resolve the problems that were discovered,"he said.""

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