Fears abound over a possible new strip club that could open despite the council’s policy of not allowing any new sex establishments in the borough.

Residents and councillors are concerned that Bar Aquarium, in Old Street, Finsbury, may become a strip tease venue - although the new owners say that is only one possibility they are considering.

The bar would be able offer sexual entertainment, despite the council ban, because it has retains the necessary licence from a brief period as a strip club in the past.

The venue changed hands in May and is undergoing extensive refurbishment, but people in the area are worried that the new owners will use the sex licence when it reopens in the autumn.

Karen Thomas, who lives who nearby Tabernacle Street, said: “It’s a matter of concern for local residents. Do we really need another striptease pub operating in our borough? There are already a lot of strip tease venues in the area. If there are new owners, surely they should have to apply for a new licence? It is getting in through the back door.”

Councillor Paul Smith, Islington Council’s executive member for the environment, said: “This was a decision by the previous and we have a totally different approach. The licence was granted and unfortunately there is not a lot we can do. It will come up for review, but that is a way down the line.

“We will be taking a much stronger view to protect our neighbourhoods.”

But Michael Jones, one of the new owners, say the prohibitive cost of an adult entertainment licence has made them think twice.

Mr Jones said: “It is something we are considering, but we are not 100 per cent sure. Even though the licence is in place, it will be �14,000 for the year and the building is already costing enough to refurbish as it is.

“We have a few options - we might split the place into two venues and we want to get the roof garden in good shape for the Olympics. But we’ll sit down in a few and decide if we want to go down the strip club route.”