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Severn Trent facing charges

22/11/2007

Water company Severn Trent is to face criminal charges over the alleged supply of false information to the industry regulator.

In a statement today the utility company revealed the Serious Fraud Office (SFO) intends to charge the firm with three offences relating to leakage data supplied to Ofwat between 2000 and 2002.

However no individual will be charged over the allegations, according to the SFO.

The SFO informed Severn Trent in October 2005 that it was undertaking a criminal investigation into alleged reporting irregularities concerning leakage data supplied by the company in the three years to 2003.

Ofwat, which referred the case to the SFO, launched its own investigation into claims of false reporting by a Severn Trent employee in May 2004 – with the company subsequently issuing an apology to its customers in the wake of an interim report on the matter published by the regulator in March last year.

Following the probe Severn Trent also credited customers' accounts and reduced future tariffs, but acknowledged Ofwat might expect consumers to be given further compensation.

Ofwat subsequently stated that an appropriate sum would be considered in conjunction with Severn Trent following the completion of the SFO investigation.

Commenting on the fraud office's investigation, Severn Trent chief executive Tony Wray stressed the company had "co-operated fully" with the body's officials during the probe.

"We will now study carefully the details of the charges which relate to the responsibilities of a previous regime," he said.

"Until that process is completed and we have taken legal advice, we cannot comment further on our response to the charges."

Mr Wray added that Severn Trent's new board and management team continued to take actions "to ensure the maintenance of both high ethical and professional standards and resilient and effective controls" throughout the organisation.