The UK’s Serious Fraud Office has arrested four people on suspicion of a home insulation scam that may have cost energy companies as much as £44m.
The SFO and the National Crime Agency said on Wednesday that the unnamed people were arrested in coordinated dawn raids across England on suspicion of conspiracy to defraud.
The investigation relates to government-mandated support for poorer households to receive upgrades to insulation and heating that could keep their homes warmer, save them money and reduce carbon emissions.
The government mandates that energy companies pay for the scheme, known as the energy company obligation 4 (ECO4). The scheme will end in December, to be replaced by the warm homes plan, which also funds solar panels and heat pumps.
In January MPs called for the SFO to investigate the home insulation sector amid thousands of reports of households being blighted by disastrous works and large financial costs. Parliament’s public accounts committee criticised the fact that the ECO4 scheme was operated by several different organisations without strong oversight.
Ellie Reeves, the government’s solicitor general, said the SFO was looking at “companies that allegedly did little more than submit false invoices for work they failed to carry out”.
The SFO said it was appealing for information on the Staffordshire-based Warmfront, Sheffield-based JJ Crump and Hampshire-based South Coast Insulation Services in connection with ECO4 projects from 2022 to 2024. The SFO said Warmfront was sold in 2024 and now traded under new management not connected to the investigation.
The agencies said they searched homes in Cannock in Staffordshire, Wolverhampton, Chilworth in Hampshire and Southwell in Nottinghamshire. Two commercial sites were searched at Cannock and Killamarsh, in north-east Derbyshire.
Graham McNulty, the SFO’s director, said: “This scheme was designed to reduce carbon emissions, help households cut costs and stay warm – instead, in many cases, we suspect little or no work was done. We are particularly keen to hear from installers and assessors who worked on these contracts and know what really happened. Our door is open and coming forward is the right thing to do.”
Reeves said: “This scheme was meant to tackle fuel poverty and improve people’s homes. I am sickened by those who want to profit off the back of a scheme designed to help vulnerable people, and I’m confident the SFO’s investigation into allegations of substantial fraud will deliver the answers victims and the public deserve.”
