The leader of Braintree Council confirmed on Friday that two councillors were being investigated for benefit fraud.
The two were arrested by Essex Police and it has now been confirmed they are both councillors on Braintree Council.
Braintree council leader John Gyford said: "I confirm the story, but I have no further comment until the investigation is over."
An Essex Police spokeswoman confirmed two people had been arrested following allegations of benefit fraud.
Both have been released on police bail pending further investigation.
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