Severn Trent has been fined £2 million after pleading guilty to lying over leaks.
The water company was ordered to pay £220,000 in costs on top of the fine, handed down today at the Old Bailey.
Severn Trent lied to Ofwat about the amount of water the company was losing through leaks, telling the regulator it was an estimated 340 megalitres per day instead of the real figure of 514 megalitres, to delay costly repairs and bad publicity.
The fine is the second for the company this year, following a record £35.8 million penalty levied by Ofwat for misleading the watchdog on poor customer service.
Chief executive Tony Wray said: "We deeply regret the mistakes of the previous regime for which we have apologised to customers.
"There were indefensible shortcomings in Severn Trent's previous management and control systems during the 2000 to 2004 era."
The board of Severn Trent has decided not to take legal action against the former management, the company said.
Mr Wray added: "Severn Trent is now focused on our ambition – to achieve the highest quality of customer service standards while offering our customers the lowest prices."
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