The allegations are linked to Elm Guest House and the Grafton Close care home in Barnes, south-west London. The arrests were made as part of Operation Fernbridge, which was launched after concerns were raised by MP Tom Watson. He told the House of Commons last year that a file of evidence used to convict Peter Righton of importing child pornography in 1992 contained clear intelligence of a sex abuse gang. Mr Watson also alleged a member of the group had bragged about links with a senior aide to a former prime minister.
Commander Peter Spindler of the Metropolitan Police said: "This is a complex investigation supported by the NSPCC, Ceop and Richmond Social Services involving non-recent allegations of sexual assault.
"It is vital that anyone who has information about activity in the early 1980s at the Elm Guest House or the Grafton Close care home in Barnes speaks to the NSPCC or the police."