Backhanders, bribes, corruption and dodgy deals of more than £1.5million were behind the building of the Cranbrook heating hub.
Bribes worth millions of pounds were paid for ‘lucrative contracts’ to build the district heating network at the East Devon new town of Cranbrook, police have revealed.
Corrupt subcontractors, who issued fake or inflated invoices as a way to handover the money, paid bribes to the tune of around £2million to two employees at energy giant E.ON in a bid to build the Cranbrook heating plant.
The bribes included cash, false invoices, references and home improvements, said police.
This week six fraudsters appeared in court for sentencing for a raft of bribery, money laundering and fraud charges relating to the construction of the heating system at Cranbrook.
The two former E.ON employees involved had signed off the fake invoices for payment, and the contractors gave them the extra cash that had been added to the over-inflated bills.
The cash bribes, which took place around a four-year period, from 2011 until 2015, were only discovered when the two E.ON employees left the company and new staff found ‘discrepancies’ when they reviewed the work.
‘Worried’ about what had happened, the new employees contacted police and an investigation was launched.
Police said smaller companies who bid for the work ‘lost out’ as a result of the bribery and corruption.
There was no wrongdoing on the part of the energy company itself, police added.
Mark Baker, employed as E.ON’s head of projects and later head of build for Cranbrook’s heating hub, worked with Matthew Heyward, who was a quantity surveyor, responsible for signing off works.
Baker and Heyward accepted bribes and illegal payments from companies Priddy Engineering Limited and RK Civil Engineering.
Priddy Engineering Limited was controlled by Andrew Blunsdon who paid bribes to both men.
RK Civil Engineering Ltd (RKC) was one of a group of companies controlled by Richard King. King’s business partner at RKC was Timothy Patterson and bank accounts linked to the pair showed they paid a combined total of more than £1.5million to Baker and Heyward.
Appearing at Winchester Crown Court for sentencing on Wednesday, April 30, and Thursday, May 1, Mark Baker, aged 56, of Goole in Yorkshire, was jailed for 46 months and banned from being a company director for seven years after he admitted being bribed, four counts of fraud by false representation, being concerned in a money laundering arrangement and fraud by abuse of position.
Matthew Heyward, 51, of Kingsteignton, Devon, was jailed for 30 months and banned from being a company director for seven years after he pleaded guilty to bribery and being concerned in a money laundering arrangement.
Former E.ON employees Mark Baker, left, and Matthew Heyward, right, took bribes and backhanders for heat hub building contracts at Cranbrook.
Image: D&C Police
Andrew Blunsdon, aged 57 of Winscombe in Somerset, admitted two counts of bribery, and was sentenced to 12 months in prison, suspended for two years. He must complete 150 hours of unpaid work.
Richard King, aged 51, of Husbands Bosworth in South Leicestershire, was jailed for 29 months after admitting to fraud by false representation and to bribing another person.
Timothy Patterson was jailed for four years and banned from being a company director for seven years after admitting two counts of fraud by false representation, two charges of bribing another person and one of acquiring criminal property.
Richard King, left, and Timothy Patterson, right, paid out millions of pounds in bribes to for ‘lucrative’ building contracts at Cranbrook.
Image: D&C Police.
And Mark Baker’s wife, Angela Baker, 53, also of Goole in Yorkshire, was sentenced to 13 months in prison, suspended for two years and made subject of a three months’ 8pm to 6am curfew, after pleading guilty to two counts of fraud by false representation and being concerned in a money laundering arrangement.
Detective Inspector Dan Parkinson from the Devon and Cornwall Police complex fraud team, said: “These individuals believed corrupt practice was widespread in the construction industry and the method by which business was done.
“Corruption costs business and society, providing benefit for just a corrupt few. Ultimately, we all pay the price.
“These corrupt practices are a parasitic blight on society.
“It is through E.ON’s initial identification of concerns and reporting this corrupt practice to Devon and Cornwall Police that enabled these convictions to be obtained.
“Bribery is a criminal offence and it is illegal for both employer and employee to offer, promise, give a bribe or receive or accept a bribe.
“This was a complex and time-consuming investigation but we are happy to have worked alongside E.ON and secured convictions against six defendants who believed rules did not apply to them and they could do whatever they wanted in order to reach their desired goal.
“These practices were often referred to as favours. Favours they are not, they are simply corrupt criminal practices.”
An E.ON UK spokesperson said: “Our internal processes enabled us to identify this case and take decisive action. Reflecting our zero-tolerance approach to bribery, we reported the matter to the police and have fully supported their investigation.”
Bribes and illegal payments
The court heard how former EON employees Mark Baker and Matthew Heyward took bribes and illegal payments to ensure specific companies won ‘lucrative’ contracts to build Cranbrook’s heating plant, which would supply the whole town.
The pair were paid a total in excess of £1.5million from bank accounts linked to Richard King and his business partner Timothy Patterson, both from RK Civil Engineering Ltd.
The bribes and backhanders to the men were made in the form of cash, money paid in to bank accounts, the use of prestige cars, free hotel rooms, free building work and false references.
Baker was kept on side by being provided with fake references, which allowed him to fraudulently move house multiple times.
A Devon and Cornwall Police spokesperson said: “The reason the bribes were paid is because these companies were construction contractors who either had or desired a commercial relationship with E.ON. Part of Mark Baker’s role was deciding which companies should be given construction contracts at Cranbrook, and later at other locations around the UK.
“Heyward played a key role in authorising the payment of contractor’s invoices, particularly at Cranbrook.
“Blunsdon, King and Patterson knew Baker and Heyward to be in positions of influence when it came to the awarding and the management of contracts. They bribed them to further their own financial interests knowing they’d willingly act in a corrupt manner.
“The bribes started in 2011 and continued through until the end of 2015 when E.ON discovered and reported the illegal activity.”
“There was no wrongdoing on the part of the energy company itself,” police said.
The start of the deception
In 2011, a year after the first spade went into the ground at Cranbrook, and E.ON won the contract to supply the new town with district heating, the Bakers accepted a false employer’s reference from Priddy Engineering Ltd.
The fake document, handed over to an estate agent, contained false information about Angela Baker’s income and employment, allowing the couple to rent an expensive house in Lincolnshire.
During 2011 and 2012, Blunsdon’s Priddy had an ongoing Cranbrook contract with E.ON and for the whole period paid Heyward around £40,000 in bribes.
A police spokesperson said: “By the summer of 2012 the Bakers had moved to Devon, and Blunsdon further bribed Mark Baker by arranging and paying for an air conditioning unit to be installed in his wife’s florist shop.
“Blunsdon then submitted an invoice to E.ON as part of his company’s ongoing contract with the company. The invoice was signed off by Heyward.”
Leicestershire-based company RK Civil Engineering Ltd had an ongoing lucrative contract with E.ON as a preferred contractor. However, RKC’s King and Patterson also had a corrupt relationship with Baker and Heyward.
The Devon and Cornwall Police spokesperson said: “From early 2012 to late 2015, RKC paid bribes to Mark Baker totalling around £175,000.
“Needing to cover up the bribes in their accounts, Mark Baker submitted a number of false invoices through his company Baker Projects Ltd to RKC often marked as ‘wages’ even though Mark Baker did not work for RKC.
“Mark Baker also received bribes from RKC in the form of false references of employment to obtaining rental properties and mortgages, free building work and improvements to one of his houses, an air conditioning unit at the florist and a Range Rover.”
Large-scale bribes
At the same time, RKC also bribed Heyward, but on an even larger scale than Mark Baker, police said.
The force spokesperson said: “Over this time period Heyward accepted a total of £1.4million, once again covered up by false invoices submitted to RKC by two companies associated with Heyward.
“Later in this period King and Patterson switched to paying Heyward in cash and also bought him fancy hotel rooms and supplied him with an Audi car.”
Heyward had what was described by police as a ‘raging gambling habit’. Patterson was also a habitual gambler.
Heyward ‘kicked back’ more than £500,000 of the money received from RKC to Patterson who then spent it.
Fake wage slips and false references
Between 2011 and 2014 Mark and Angela Baker moved house four times. Each of the moves was tainted by fraud.
The police spokesperson said: “In 2012 the Bakers moved from Lincolnshire to Devon to be closer to the site in Cranbrook. To rent this property a second fraud was required.
“In their rental application it was falsely declared that Angela Baker worked for RKC on an annual salary of £60,000. Patterson enabled this fraud after being contacted by Mark Baker by creating a reference and fake wage slips.
“In 2013 the Bakers moved out of their first Devon property and started the process of buying a house with a mortgage.
“The plan was to find a house, do it up and sell it on for profit, however the couple was unwilling to pay for the house or subsequent improvements.
“RKC paid the deposit and with the help of King and Patterson obtained the mortgage by fraud. RKC then went on to pay for improvements at the home.
“The property was in Okehampton and Angela Baker told the bank the deposit was a gift from her father.
“The majority of the deposit came from RKC as a disguised bribe to Mark Baker. Further money was received in smaller amounts.”
Angela Baker lied to the bank, claiming she worked for RKC on a salary of £85,000 a year, by passing off fake wage slips created to disguise the fraud which involved both of the Bakers, King and Patterson.
The force spokesperson said: “RKC went on to pay for improvements to the property worth £50,000 before the home was sold at a profit by the Bakers.
“After spending some of the profits on a car and holidays, the Bakers purchased a house in Yorkshire in late 2013.
“To buy the property Angela Baker again claimed to the mortgage lender to be a RKC employee earning £84,000 a year. King created a wage slip to enable this.”
