Two black men were stopped by police because they had innocently exchanged a fist-bump, a watchdog has found.
The Met Police officers exercised stop and search powers after they suspected the men of exchanging drugs because of the bump.
The Independent Office for Police Conduct (IOPC) said a review of recent cases involving the Met Police showed there was a "lack of understanding" from officers and the "legitimacy of stop and searches was being undermined".
The IOPC has drawn up a number of recommendations to improve the use of stop and search powers, including offering better education for officers.
Several of these investigations found that although an initial search found no wrongdoing, officers were slow to end the encounter.
In one investigation, a black man in possession of someone else's credit card was suspected of having stolen it - even after providing a credible explanation.
In two other investigations, the smell of cannabis formed the sole grounds given for the stop.
Handcuffs were also used in nearly all instances where the use of other tactics could have de-escalated the situation, the watchdog said.
The IOPC highlighted the failure of officers to use bodycam video from the outset and to seek further evidence after the initial grounds for the stop and search were unfounded.
The watchdog has recommended 11 ways the Met Police, Britain's biggest force, can improve its use of stop and search powers.
They include offering better education of powers to officers, improving monitoring from above, ensuring racial prejudice is removed and making sure the stop and search encounter is ended swiftly after suspicion is allayed.
IOPC London regional director Sal Naseem said: "The review mirrors concerns expressed to us by communities across London.
"We saw a lack of understanding from officers about why their actions were perceived to be discriminatory.
"We recommended the MPS (Metropolitan Police Service) takes steps to ensure that assumptions, stereotypes and bias (conscious or unconscious) are not informing or affecting their officers' decision-making on stop and search."
Mr Naseem added: "The review highlights the need for the Met to reflect on the impact this kind of decision-making is having. There is clearly much room for improvement."