High Court Rules Environment Agency Can Prosecute Former Southern Water Chief Matthew Wright for Conspiracy to Defraud

A former Southern Water chief executive has failed in a High Court attempt to establish that the Environment Agency had no legal power to prosecute him for conspiracy to defraud.

In a judgment handed down today – 22 July 2026, Lord Justice Popplewell and Mr Justice Hilliard refused Matthew Wright (pictured) permission to bring judicial review proceedings and lifted an anonymity order which had prevented him being identified in connection with the challenge. The court expressly authorised full reporting of the Administrative Court proceedings, including Wright’s identity.

This article is confined to the published High Court judgment and the Environment Agency’s official announcement. It does not report proceedings at Medway Magistrates’ Court. The criminal allegations remain unproven, the proceedings are live, and no finding of guilt has been made against Wright or any other individual.

Wright was Southern Water Services Limited’s chief executive during the material period. Philip Barker, Clive Massey and Mark Gregory, described by the judgment as company officers or senior operational managers, were interested parties to the High Court case.

The Environment Agency obtained summonses alleging a common-law conspiracy to defraud. Wright’s argument was not that the alleged conduct could never amount to a criminal offence, nor that another public prosecutor could not have brought the charge. His case was narrower but potentially far-reaching: that the Environment Agency itself lacked the statutory authority to prosecute conspiracy to defraud and that the summons was therefore a nullity.

At the heart of the dispute was section 37(1) of the Environment Act 1995. It permits the Agency to do anything which, in its opinion, facilitates, is conducive to or is incidental to carrying out its functions, and adds that the Agency may institute criminal proceedings in England and Wales.

Wright’s legal team argued that this was not a general prosecution power. They said it was confined to statutory environmental offences and did not extend to common-law offences, fraud, dishonesty, conspiracy, attempts or accessory liability. The Environment Agency initially advanced the opposite extreme: that it possessed a general power to prosecute any criminal offence.

The High Court rejected both extremes.

Lord Justice Popplewell held that the Environment Agency is a statutory body and has no free-standing prosecutorial power outside the statute which created it. Parliament had not given it unlimited authority to prosecute crimes unconnected with its work.

But the court accepted the Agency’s alternative case. Section 37 allows it to prosecute “any offence of any nature” where the prosecution is capable of facilitating, being conducive to or being incidental to one of its statutory functions, and where the Agency forms that opinion. Its power is therefore broad, but it is not unrestricted: the prosecution must remain connected to the functions Parliament entrusted to the regulator.

On the allegations before the court, that connection was direct.

Operator Self-Monitoring, or OSM, transferred responsibility for taking and reporting wastewater-treatment samples from the regulator to environmental permit holders. Sampling teams were meant to operate separately from those running the treatment sites, with visits unannounced.

A legitimate “no-flow” result occurred where insufficient wastewater was flowing at the random moment a sample was due to be taken. That result did not count as a failure, and no replacement sample was required during that testing period.

The Environment Agency alleges there was a deliberate plan to manufacture those circumstances at sites which might otherwise fail testing. The judgment records an allegation that wastewater was removed by tanker to create artificial no-flow results, preventing the true position from being reported to the Environment Agency and Ofwat.

Lord Justice Popplewell stressed that these were allegations, but described what was alleged as “carefully planned and extensive fraud and dishonesty at a high level within the Company and on a large scale”. He recorded that the Agency says Southern Water’s own assessment placed the penalties allegedly avoided at about £45 million, while the Agency’s assessment was higher.

The High Court found that prosecuting an alleged fraud aimed at manipulating a wastewater regulatory system was plainly connected to the Environment Agency’s functions. Such a prosecution could help prevent pollution allegedly being concealed, stop similar conduct continuing, deter others and enable criminal benefits or losses to be addressed through confiscation or compensation orders.

Wright’s proposed interpretation would also have produced serious anomalies. The judgment observed that the Agency could prosecute somebody who personally dumped toxic waste into a river, but—under Wright’s construction—could not prosecute a group who agreed to do it if their plan was stopped before completion. It could prosecute a principal offender but not necessarily those who assisted or conspired with that person.

The court found “no logical or practical sense” in such distinctions. It concluded that the statutory language imposed a connection-to-functions test, not a restriction based on the formal label attached to an offence.

Lord Justice Popplewell said he reached his conclusion “without any real hesitation” and did not regard the judicial-review application as arguable. Permission was refused. Mr Justice Hilliard agreed.

The judgment is equally significant for open justice.

Wright had secured an interim order requiring him to be identified only as “CVB” and preventing publication of information likely to reveal his identity. He argued that publicity would severely damage his reputation, career prospects and family life.

The court found that his evidence fell far short of justifying anonymity. It restated that court proceedings should generally be public, that names are ordinarily reportable and that the press performs the democratic role of “watchdog” and “bloodhound”. Restrictions require clear and cogent evidence and must be strictly necessary.

Lord Justice Popplewell held that Wright’s asserted privacy interests either failed to engage Article 8 of the European Convention on Human Rights or carried little weight against the imperative of open justice. His former high-profile position at a major public utility reduced his expectation of privacy concerning the company’s affairs.

There was also a procedural sting.

After the date connected to the anticipated publicity had changed, neither side informed the Administrative Court quickly enough. The court found that Wright’s failure amounted to a “serious” breach of his duty of candour and caused the application to be treated as urgent on a mistaken basis. It also found that the Environment Agency breached its own duty by failing to notify the court promptly, although the judgment placed primary blame on Wright.

The Environment Agency has now publicly confirmed proceedings against Southern Water Services Limited and former employees. It says the allegations concern artificial no-flow events between 1 January 2012 and 31 December 2017 and that separate environmental-permit charges have also been brought. Because those cases are live, the Agency says it cannot provide further information.

Its spokesperson said: “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.”

The High Court has not decided whether anybody committed that offending. What it has decided—decisively—is that the Environment Agency has the legal power to bring this particular charge, that Wright’s challenge was not arguable, and that the public is entitled to know who brought it.

The Shepway Vox Team

Dissent is NOT a Crime