Former Southern Water CEO Charged with Conspiracy to Defraud Over Sewage Data Manipulation

The former chief executive of Southern Water is being prosecuted for conspiracy to defraud along with three other former employees, over allegations they manipulated sewage wastewater testing results to avoid tens of millions of pounds in fines.

Matthew Wright is the first water industry boss to face a criminal charge over sewage discharges. He and three others are charged with conspiracy to defraud the Environment Agency and ​the water regulator, Ofwat, between 2012 and 2017 by ⁠creating artificial “no-flow” ​events ​at wastewater treatment ​works to ​influence ‌compliance checks.

The case focuses on operator self-monitoring, which was introduced to cut regulatory costs in 2009. The other former employees are Philip Barker, Clive Massey and Mark Gregory.

Operator self-monitoring allows water companies to monitor and test discharges from their wastewater treatment works, rather than the testing being carried out by an independent regulator.

Strict rules govern how samples must be taken to ensure their independence and accuracy. It is an offence if there is evidence that flows or data have been deliberately manipulated to avoid compliance checks.

Southern Water, which has more than 4 million customers, is also being charged with breaching environmental permits linked to the same conduct. Three further individuals are also being charged linked to failure to comply with environmental permits.

The charges come after a long investigation by the agency. An attempt by the defendants to remain anonymous was overruled by the high court.

An Environment Agency spokesperson said: “We can confirm that we are taking criminal proceedings against Southern Water Services Ltd and a number of former employees.

“We take our responsibility to protect the environment very seriously and will always pursue and prosecute those alleged to have committed serious offending against the environment.”

In a judgment published on Wednesday, the ​high court rejected Wright’s argument that the EA lacked the power to prosecute him for conspiracy to defraud.

The ruling clears the way for the Environment Agency’s prosecution to proceed ahead of a criminal trial due to begin in September.

According to the judgment, the EA alleges that by the company’s own assessment, the scheme allowed it to avoid penalties of about £45m, but the regulator’s assessment put the figure higher.

Conspiracy to defraud carries a maximum sentence of 10 years’ imprisonment. The case will now proceed at Medway magistrates court.

The environment secretary, Angela Eagle, said: “The public are rightly sick of environmental pollution and attempting to cover it up is outrageous. Anyone found guilty of this crime will face the full force of the law.

“This government will always back tough enforcement action to protect our rivers, lakes and seas. We have already committed to ending the practice of operator self-monitoring to ensure this cannot happen again in the future.”