British Post Office Scandal

The British Post Office scandal is a miscarriage of justice involving the wrongful civil and criminal prosecutions of an unknown or unpublished number of sub-postmasters (SPMs) for theft, false accounting and/or fraud. The cases constitute the most widespread miscarriage of justice in British legal history, spanning a period of over twenty years and it remains unresolved.

After some convicted SPMs successfully sued the Post Office, 555 convictions were declared unsafe and to have been obtained unlawfully. By 2022, 736 prosecutions had been identified, 81 convictions had been overturned and more were expected to be quashed. The number of those affected by other types of abuse by the Post Office, torts, breach of contract, coercion etc., has not been tabulated or published. The prosecutions, civil actions, and extortions resulted in criminal convictions, false confessions, imprisonments, defamation, loss of livelihood, bankruptcy, divorce, and suicide.

In 1996, International Computers Limited (ICL) began working on a computer accounting system, called Horizon, for the publicly-owned Post Office corporation. By 1999, ICL was part of Fujitsu. In 1999, the problems began with Horizon's introduction, which wrongly detected the existence of financial discrepancies at multiple post office branches. Second Sight's (forensic accountants) report of 2014 described the Horizon Computer System as not fit for purpose, whilst the Post Office stated that "there is absolutely no evidence of any systemic issues with the computer system". The Post Office terminated the Initial Complaint Review and Mediation Scheme in 2015 and published a report clearing themselves of any wrongdoing.

The Post Office has a single shareholder, the British Government. Initially, the government refused to pay any compensation; both the Post Office and government repeatedly stated that the money awarded when the SPMs sued the Post Office was a full and final settlement. After appeals by MPs in 2021, the government promised financial compensation to the victims of the scandal, as the Post Office itself did not have sufficient resources.

The Post Office set up a separate historic shortfall scheme that went on to attract more than 2,400 claims. The scheme excluded the 555 SPMs who had successfully sued the post office. , no commitment to compensate those 555 SPMs existed. On 22 March 2022, a government scheme was launched to compensate the 555 SPMs at the same level of compensation as other SPMs.

In 2020, the government initiated an independent inquiry, led by retired judge Wyn Williams. After two initial hearings, it was converted to a public inquiry in June 2021. In November it held a preliminary 'List of Issues Hearing' and, in February 2022, commenced a series of 'Human Impact Hearings' investigating whether the Post Office and software supplier Fujitsu knew about the faults in the IT system, which led to criminal convictions and civil proceedings against staff, which have subsequently been quashed. The inquiry hopes to be completed by Autumn 2022.

Overview

In 1999, the UK Post Office, part of Royal Mail, introduced a computer accounting system, Horizon, developed by the Japanese company Fujitsu. From February 2003 to 2010, Royal Mail was under the leadership of Adam Crozier, its CEO.Adam Crozier to leave Royal Mail later this year to join ITV
Royal Mail Group, 28 January 2010 On 1 April 2012, Post Office Ltd became independent of Royal Mail Group, and was reorganised to become a subsidiary of Royal Mail Holdings, with a separate management and board of directors.

By 2013, Horizon was used by at least 11,500 branches and was processing some six million transactions every day. From 1999, sub-postmasters (SPMs) began reporting unexplained discrepancies and losses. The Post Office maintained that Horizon was "robust" and that none of the discrepancies were due to Horizon. Some sub-postmasters unwilling or unable to make good the shortfalls were prosecuted by the Post Office for theft, false accounting and fraud. Between 1991 and 2015, there were 918 successful prosecutions. These were largely private prosecutions by the Post Office relying on IT evidence alone, without proof of criminal intent. Public prosecutions also occurred in Scotland, Northern Ireland and in the Crown Court. Some SPMs were persuaded by their own solicitors to plead guilty to false accounting, on being told the Post Office would drop theft charges. Once the Post Office had a criminal conviction, it would attempt to secure a Proceeds of Crime Act order against convicted sub-postmasters, allowing it to seize their assets and bankrupt them. According to press reports, these actions by the Post Office caused the loss of dozens of jobs, bankruptcy, divorce, unwarranted prison sentences and one suicide.

In 2019, the Horizon Issues trial judgment in the ''Bates & Others v Post Office Ltd'' group litigation at the High Court found that software errors and defects did exist and that it was possible for these to cause apparent discrepancies or shortfalls in branch accounts or transactions, to undermine the reliability of Horizon accurately to process and to record transactions. Mr Justice Fraser found that this had happened on numerous occasions.

In September 2020, the Post Office declared it would not oppose 44 postmasters' appeals against conviction, but it unsuccessfully opposed their appeals against improper prosecution. In December 2020, six summary jurisdiction convictions were quashed, and in April 2021 the Court of Appeal quashed a further 39 convictions. The court made the rare finding that the Post Office had acted in such a way as to subvert the integrity of the criminal justice system and public confidence in it. The prosecutions were found to be an abuse of process and an affront to the conscience of the court. By this relatively rare finding the appellants were completely exonerated. The BBC called the convictions "the UK's most widespread miscarriage of justice".

In April 2021, Post Office chief executive Nick Read announced that the Horizon system would be replaced with a new cloud-based IT system.

Horizon computer system

The Horizon computer system cost £1 billion and was designed by ICL/Fujitsu Services.

After a lengthy competitive procurement exercise, begun in 1994, the contract for further development and full implementation in all post offices was awarded in May 1996 to ICL's ''Pathway'' division, which had been created for the purpose.

In 1999, four years and £700 million of taxpayers' money after the pilot scheme began, the government, by now Labour, stopped the scheme in its tracks. The Department of Social Security withdrew from the deal, leaving ICL/Fujitsu to run the system. ICL subsequently criticised the PFI payment criterion: it would have been paid partly on how many customers post offices attracted. Stuart Sweetman, the then group managing director of customer and banking services for Consignia (the name used at the time by the then holding company for Post Office Counters Ltd, Parcelforce and Royal Mail), said in 2001: "Looking back, I think it was over-ambitious ... You can't export all the risk to a supplier."

On 8 April 2021, after the problems had caused scandal, Post Office chief executive Nick Read announced that the Horizon system would be replaced by a new IT system that would be "more user-friendly, easier to adapt for new products and services, and cloud-based to ensure easy maintenance and ready interoperability with other systems." He said: "This will not be easy – it will after all be among the biggest, if not the biggest, IT roll-out in the country when the time comes. But the change is both necessary and overdue."

Problems

Sub-postmasters began to report computer errors to the Post Office within weeks of the Horizon system being installed, via the 'Helpline' the SPMs were instructed to use. The Post Office resisted the SPMs' reports of faults in the system, insisted that the SPMs make up any shortfall of money and, when asked by an SPM, denied that other SPMs had reported problems. In 2000, there were six shortfall convictions that relied on Horizon data. 41 SPMs were prosecuted in 2001, and 64 in 2002. In May 2002, shopkeeper Baljit Sethi raised concerns with the press that there were errors in Horizon, after his wife Anjana Sethi was notified that her SPM contract would be terminated. The Post Office responded that they "totally refuted" that the system was faulty, and that it had "sent experts... to check it twice". In around 2000, problems with the system were reported by Alan Bates, the SPM at Craig-y-Don from March 1998 until November 2003. In 2003, Bates had his contract as SPM terminated when he refused to comply with Post Office policy. He reported his concerns to ''Computer Weekly'' in 2004; sufficient evidence had been gathered by 2009 to publish it. A campaign group on the issue, Justice for Sub-postmasters Alliance (JFSA) was formed by Bates and others in September 2009. By 2012, concern in the media, and amongst a number of members of parliament, had grown. As a result, an independent investigative firm, Second Sight, was commissioned by the Post Office to conduct a separate, independent inquiry in 2012. At around this time, Paula Vennells became CEO of the Post Office.

Second Sight reports

# Interim Report dated 8 July 2013;
# Briefing Report Part One dated 25 July 2014;
# Briefing Report Part Two version 1 dated 21 August 2014;
# Briefing Report Part Two version 2 dated 9 April 2015.

Vennells, who stood down from her Post Office role in 2019, said in 2020, of the 2013 report, that "it concluded, while it had not found evidence of system-wide problems with the Horizon software, there were specific areas where Post Office should consider its procedures and operational support for sub-postmasters." Ron Warmington, of Second Sight had said in 2019 "if the Post Office Board had believed ... and acted on ... what Second Sight reported ... instead of being led by the nose by its own middle management and in-house and external legal advisors, huge amounts of money, and human suffering, would have been avoided." In July 2013, Second Sight issued an interim report and Post Office Ltd admitted that software defects with ''Horizon'' had indeed occurred, but said that the system was effective. The review discovered problems in 2011 and 2012, when Post Office Ltd discovered defects that had caused a shortfall of up to £9,000 at 76 Post Office branches. The BBC
...