Senior employees and directors at Severn Trent were guilty of “sophisticated dishonesty” and “false manipulation” of official water statistics, a court heard yesterday.

In a sentencing hearing at the Old Bailey, a judge heard details of an e-mail exchange between two employees at Severn Trent, the UK’s second largest water company.

Will Bradford, a manager responsible for reporting water leakage statistics, was encouraged to create figures to match Severn Trent’s desired targets, Andrew Edis, QC, for the Serious Fraud Office (SFO) said.

Mr Edis described an e-mail that Mr Bradford sent to his boss, Mark Wilson, the director in charge of regulation, with the title “lies, damned lies and statistics”.

In the e-mail, Mr Bradford told his boss he had been “selective in the data I have used” and that he had been “economical with the truth” in order to meet Severn Trent’s preferred figures that were later supplied to Ofwat, the water regulator.

Yesterday’s hearing at the Old Bailey was called so that a judge can determine the fine Severn Trent must pay after pleading guilty to two offences of making false returns to Ofwat earlier this year.

Mr Edis told the court that Severn Trent faced an unlimited fine and should be given a penalty large enough to serve as a “deterrent precedent” to others.

Severn Trent has agreed to pay the SFO’s costs of £200,000 in the case.

The company, which has 3.7 million customers, was fined a record £35.8 million by Ofwat this year for deliberately providing false information and poor customer service.

Edmund Wilson, QC, representing Severn Trent, said all those said to have been the “directing minds” of what happened had “long since departed the company”, which was now “under entirely new executive control”.

The prosecution is against Severn Trent as a company. No individuals have been charged.

Explore Law

• Columnists

• Law Panel

• Law Reports

• Student Law

Times Recommends

• BGC 'set aside £40m to lure Tullett brokers'
• Legal aid review to ensure value
• Fears as 21 magistrates' courts face closure