Police investigating claims of fraud have arrested four former employees from the company which holds the Government's welfare-to-work contracts.
The fraud allegations were referred to Thames Valley Police by the Department for Work and Pensions.
"As part of the investigation, four people, two women aged 28 and 49, and two men, aged 35 and 41, were arrested on suspicion of fraud on January 18 from addresses across the Thames Valley," a police spokesman said.
All four have been released on bail until a date in mid-March.
The Government has been urged to suspend its contracts with A4e after the revelations surfaced that it had referred former employees' activities to police.
Prime Minister David Cameron told MPs (BSE: MPSLTD.BO - news) there should be a "thorough" investigation.
"It needs to get to the truth and then we can take into account its findings," the Prime Minister said.
He said the allegations went back to a scheme run under the previous Labour government.
"As I understand it was the company itself that raised the issue with the relevant authorities," he added.
The company, which has offices in Slough, is chaired by Emma Harrison CBE, who was appointed by Mr Cameron in 2010 to help get troubled families into work.
Its (Euronext: ALITS.NX - news) five shareholders were paid £11m in dividends last year, of which Ms Harrison received 87%.
On her personal website, the mother-of-four describes herself as "one of the UK's most well-known and successful social and philanthropic entrepreneurs".
A4e chief executive Andrew Dutton has repeated assurances that the company has "zero tolerance" towards fraud.
He said: "I will not sit by and let these accusations discredit the hard work that our staff do to support thousands of people into work.
"A4e has zero tolerance towards fraud, and any instance of fraudulent or otherwise illegal activity is completely unacceptable.
A4e said it employs more than 3,500 staff across the UK and abroad, working from more than 250 offices.
Thames Valley Police said the ongoing investigation concerned four former A4e front-line staff working on European Social Fund in England (ESF) contracts, and are alleged to have falsely claimed that customers had been placed into employment.
Three of the staff involved were suspended once the allegations had been made and the other had already left the business, but all four have now left, A4e said.
Labour MP Margaret Hodge, chairwoman of the Public Accounts Committee, has attacked the firm's performance record as "abysmal" and said the Government should consider suspending its Work Programme contracts with A4e until the matter was resolved.
But Employment Minister Chris Grayling said that would not be possible under the coalition's Work Programme because private providers were not paid until after six months.
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