BT has denied suggestions by a judge that there may be “a culture of fraud” at Openreach, the division that employs tens of thousands of engineers to build and maintain the national telecoms network, saying it catches “bad apples” in the organization.

The claim was made as part of the sentencing last week of Phillip Tamplin, a 53-year-old engineer who swindled £154,000 from BT to support his mistress in Argentina. But BT said this weekend that the successful prosecution showed its efforts to weed out wrongdoing were effective.

A spokesman said: “In an organisation of more than 33,000 people there will always be a few bad apples, but this isolated case proves we’re effective at catching and prosecuting wrongdoers.”

Tamplin was sentenced to a two-year custodial sentence. A second Openreach engineer, Christopher Starrs, 50, fraudulently claimed £28,000 in expenses and received a suspended prison sentence. Their fraud involved false claims for parking fines for Openreach vans.

In his sentencing remarks, Mr Recorder Stuart Trimmer QC said the two men, both managers, “well knew how open the organisation was to fraudulent activity”. More Openreach engineers were “extremely lucky” not to be prosecuted too, he added. “You both knew how it could be conducted, concealed and be made to benefit each of you personally.

“It is said that there was a culture of fraud that may or may not have been the case.”

The judge highlighted the fact that it would not have been possible to run the fraud without other Openreach engineers making claims and passing money to Tamplin and Starrs. “It is said that others are fortunate not to find themselves in the dock with you and that is true,” he said.

The fraudsters were caught after an anonymous tip-off, the court heard.

BT is currently overhauling Openreach under the division’s new chief executive, Joe Garner. He has been tasked with improving its record on resolving broadband faults and installing new lines, which rival telecoms providers who rent access to the BT network have complained about to regulators.

Openreach has begun publishing its latest performance statistics as part of the reforms. It is also recruiting a new generation of engineers including apprentices and former soldiers.