Arms dealers are selling bombs, guns and tanks illegally at a controversial arms fair sponsored by the Ministry of Defence.
Dozens of the 1,000 companies touting for business at the exhibition are unlicensed.
Scotland Yard has issued a blistering rebuke to the Government and handed out warning letters to the illegal exhibitors.
But the Government has ignored police concerns over security and insisted no action be taken against companies breaking the law.
It means hundreds of arms dealers from around the world, including notoriously unscrupulous companies from unstable regions, have been allowed to ply their trade without even cursory checks on their credentials.
And police have ignored the law being broken inside the Defence Systems and Equipment Inter- national exhibition in London's Docklands while outside they have arrested more than 130 anti-arms protesters.
An incredible array of weapons is on display, from tanks and rocket launchers to missiles and machine guns.
A senior Home Office source said: "It is staggering that at a time when a terrorist attack is considered inevitable, an unknown bunch of arms dealers can turn up and flog weapons without anyone knowing a thing about them.