A “Fagin's army” of 200 gypsy children from Romania has been smuggled into Britain and could be earning more than £19m a year from street crime and fraud, the European Union’s head of police has disclosed.

The children, who have an average age of eight, have been trafficked into the UK with the consent of their parents in return for a “hiring” fee from gangsters.

The activities of the gang, which Romanian police believe has smuggled 1,107 children into EU states, have been disclosed to MPs by Max-Peter Ratzel, the director of Europol. “All of these children were trafficked into the UK for the specific purpose of being exploited through the commission of street crimes and with the ancillary purpose of defrauding the UK social security system,” he wrote in a letter to the House of Commons home affairs committee last month.

“Many of their parents were complicit in their trafficking as they expect a return on the profits made, with the trafficking group involved expecting to earn up to €24m [£19.2m] per year from these 200 children. It is suspected that most, if not all of this money is sent back to Romania.”

James Clappison, a Tory MP on the committee, said the evidence highlighted the gravity of the threat posed by eastern European gangs. “The trafficking of these children is very worrying, both from the viewpoint of their own welfare and the consequences of their presence in the UK,” he said.

Last January, in a related inquiry, police raided 17 homes in Slough, Berkshire. They arrested 25 people and removed 10 children, many of whom were under the age of 10. They were handed over to social services.

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