The letters claim to be from the Health and Safety Executive

The Federation of Small Businesses said firms claiming to oversee health and safety laws have sent out "swathes" of letters demanding �249 in fees.

But, the Health and Safety Executive (HSE) does not write indiscriminately to companies, nor does it charge fees.

The Federation advised businesses to report any such letters to the HSE.

Mary Broughton, the group's Health and Safety chairman, said: "Ever increasing health and safety requirements and the threat of strong penalties for non-compliance, mean small employers are aware of the need to follow the law and may be easy prey for such scams.

Payment demands

She added that the HSE had launched an investigation into the letters - along with the trading standards office and the police.

Three firms are currently believed to be behind the scam.

Letters sent out by the fraudsters claim to be from the Health and Safety Enforcement Agency, Health and Safety Registration Enforcement Division or Health and Safety Compliance Agency.

Letters seen by the federation have demanded registration fees of up to �249.

They have also threatened businesses with fines, imprisonment or redundancies if they do not pay up.