Page last updated at 14:55 GMT, Tuesday, 1 July 2008 15:55 UK

Further 2m fine for Severn Trent

Severn Trent's actions were described as "unacceptable"

Severn Trent Water has been fined 2m following a court hearing for providing false information on leakages.

The company is already facing a 35.8m fine from regulator Ofwat for separate offences involving providing false information and poor customer service.

That fine, relating to offences which took place in 2001 and 2002, followed a probe by the Serious Fraud Office.

The firm said it "deeply regretted" its actions but would not take legal action against the former staff responsible.

Ofwat said Severn Trent's behaviour during that period had been "unacceptable".

'Deep regret'

Severn Trent Water serves more than eight million customers from the Bristol Channel to the Humber, and from mid-Wales to the East Midlands.

Severn Trent has admitted its failings and said it alerted the watchdog promptly when it became aware of the problems.

Current bosses have blamed "a previous regime" at the business for the misconduct and insisted those responsible are no longer working for the company.

We deplore the breach of the essential trust between Severn Trent and all our stakeholders
Tony Wray, Severn Trent chief executive

However, the firm said it had decided not to pursue legal action against those it says were guilty of the offences.

Severn Trent said it "deeply regretted" its past mistakes.

It stressed that it had not profited from the affair and had ensured that it had credited the accounts of affected customers and altered bills "appropriately".

"We are finally close to resolving these issues from the past and putting this organisation back into the positive position our customers, regulators and staff deserve," said its chief executive Tony Wray.

"There were indefensible shortcomings in Severn Trent's previous management and control systems. On behalf of our customers and staff we deplore the breach of the essential trust between Severn Trent and all our stakeholders."

Ofwat has said the size of the earlier fine, representing nearly 3% of the firm's annual turnover, reflected the severity of the offence.

Following the hearing at the City of London Magistrates' Court, Severn Trent will also have to pay 220,000 in costs.

Severn Trent faces a 35.8m fine
08 Apr 08 |  Business
Severn Trent sees profits sink
05 Jun 08 |  Business

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