WATER regulator Ofwat has fined Severn Trent Water a record £35.8m for providing false information and poor customer service.
The fine was proposed in April after Ofwat found customers had paid larger bills than they should have done because of the failings.
The Ofwat fine, relating to offences which took place in 2001 and 2002, followed a probe by the Serious Fraud Office.
Severn Trent Water serves more than eight million customers from the Bristol Channel to the Humber, and from mid-Wales to the East Midlands.
Ofwat Chief Executive Regina Finn said: "Severn Trent's Water was unacceptable. The size of the fine reflects how seriously Ofwat takes the deliberate misreporting of information.This sends a clear message to the company and to the rest of the water sector - Ofwat will protect consumers and companies must comply with their legal obligations or pay the price. Any further attempts to deliberately mislead Ofwat could lead to even bigger fines in the future". Ofwat have said the costs will not be passed onto its customers but will instead be borne by its shareholders.
Brian Duckworth the former MD of Severn Trent Water added: "Throughout my 30 years with Severn Trent I passionately argued for strong regulation to ensure that customers had sufficient protection in an industry dominated by monopoly companies. So I am deeply saddened that yesterday's sentence may leave some of Severn Trent's customers feeling they have been let down.
"Regrettably, the only result of this long-winded and expensive investigation is a leakage of much needed Severn Trent funds to Mr Darling at the Treasury. Clearly the £2 million fine would have been much better spent on further improvements to water services in Solihull and other parts of the West Midlands. That's the real outrage of this case."..SUPL: