This seems a little strange.
If the police believe that this car is stolen, whether or not you bought it in good faith should still remove it from you and give to the rightful owner, why havent they done this? There appears to be doubt at the way the car was obtained and therefore ownership
When you applied for a log book did you get one?
Firstly i would hide the car well away from your house prefereably in a friends garage (not bens) until this is resolved. or you could lose it and the police will not do anything as they seem to be looking on this as a repossesion
Secondly, get in touch with the dvla and find out why they have given out a V5 to a non owner of the car.
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