On this topic, as I frequently get asked, whats the law in this regard?
In answer I present the following case recently reported in QLD Newspapers.
An Ipswich security company recently fitted out all their vehicles as replicas of Police vehicles.

These vehicle had the same police checker board stripes, badges and blue lights on the roof. The drivers also wear Police like uniforms and are armed. The badges although looking like the police symbol did in fact say "Security" and the Blue lights apparently were not connected. The real Police however took a dim view of this and the Police "Union" wanted charges laid against the company and them taken to court. However the legal eagles have stated that unless they are telling people they are Police, acting as if they are Police or they have the actual word "Police" on their vehicles then they are not breaking the law. It would appear also, at least in QLD, that there is no copyright present on police vehicle livery.
A.
PS I'm not saying that this doesn't have it's consequences, abuse, drivers slowing down to a crawl and being advised to stop riding are but a few (see
http://ozstoc.com/index.php?topic=7850.msg90427#msg90427) However the safety aspect, I believe, mitigates all the negatives.