A plan to overthrow the Morrison government and arrest senior MPs and bureaucrats has been thwarted by counter-terrorism police.
The bizarre plot also involved setting up an alternative police force and the manufacture of 470 fake Australian Federal Police badges found dumped in a creek in Cairns.
One man has been arrested in Perth and other arrests are expected in coming days.
The group is allegedly behind a fake video circulating online and purportedly from AFP Commissioner Reece Kershaw, calling on people to join the AFP and overthrow the federal government.
One man arrested in Perth at the weekend has been charged with one count of impersonating a Commonwealth public official.
AFP Acting Assistant Commissioner Andrew Donoghoe said the man claimed to be a Commonwealth official during an unsuccessful attempt to obtain stamps and ID badges, bearing the official AFP logo, from a commercial business.
"We are also aware of a shipment of three boxes of replica AFP badges consigned to a house in Cairns. These were found dumped in a local creek and recovered by the Queensland Police," he said.
There were 470 badges in all.
"Inquiries are continuing to ensure no other badges are in possession of this group or any of their associates.
"We have no evidence that this group has the ability or capability to commit violent acts to overthrow the government.
"But the behaviour of these people is extremely concerning and we are continuing our investigation to identify any criminal offences as a result."
Mr Donoghoe said the fake video circulating online demonstrated that "they wanted to establish a separate Australian Federal Police force".
"They had issued several warrants for a number of high-profile government people and they intended to execute those arrest warrants on those people," he said.
He described the video as complete and utter nonsense with no truth or credibility.
The operation to dismantle the group followed a two-week investigation with raids carried out over the weekend in Perth, Brisbane, Townsville, Cairns and rural South Australia.
More arrests are expected.