Local media said the victims belonged to one of Brazil's most sophisticated crime rings, known as the First Commando of the Capital (PCC).

The gang members were stopped at a roadblock set up near the city of Sorocaba, west of Sao Paulo.

Police say between 20 and 30 heavily armed members of the gang were driving in convoy to rob a plane carrying large amounts of cash from Sorocaba airport.

Police discovered the plot when the group, who were dressed as police and even had a car mounted with police sirens, stopped at a toll booth on the road to the airport.

Real police cars circled the vehicles and the police said the gang fired first.

Officers responded, firing more than 7,000 rounds into the minibus being used by the gang, practically destroying it.

Helicopter search

Twelve of the gang members were killed, another 12 were wounded.

Three more escaped, with the police using helicopters to search for them.

It is unclear how the police knew about the raid.

Some reports suggest they had a tip-off, others that they intercepted calls from mobile phones being used by PCC members in jail.

Last year there was widespread criticism that the PCC was able to use mobiles to organise the largest ever simultaneous uprising in 19 jails across Sao Paulo state.

In addition to the PCC's involvement in a number of prison riots, over the last year the group has shown it has the capacity to act outside the jails as well - carrying out bank robberies and kidnaps, and organising mass escapes.

It has claimed responsibility for a series of grenade attacks last month against prison administration offices in Sao Paulo.