How will the Horizon 900 prove their innocence – another phase of the Post Office IT scandal?

By Tony Collins

In jubilant scenes outside the High Court last year, sub-postmasters celebrated a remarkable victory over the Post Office.

For nearly 20 years the Post Office’s  board held fast to the view that its Horizon branch accounting system was robust. Horizon data that showed money was missing from branch sub-postmaster accounts was used to prosecute and win convictions against at least 500 sub-postmasters, from Tracy Felstead who was jailed at the age of 19 to Noel Thomas who worked for the Post Office for 42 years before being jailed. Civil actions too were based on Horizon data. Newspaper articles about sub-postmasters who had been imprisoned, made bankrupt and had lost their livelihoods, life savings and homes became almost routine.

But in 2017 former sub-postmaster Alan Bates won the High Court’s consent for a group litigation against the Post Office. He was one of Horizon’s victims. He had asked the Post Office to produce the back-office data that showed he was to blame for unexplained shortfalls on his branch Horizon accounts. The Post Office did not provide the data and inexplicably terminated his contract.

Redress for Bates and his 556 co-claimants came finally in December 2019 when Mr Justice Fraser published his 1030-paragraph Horizon judgement in the case of Bates v the Post Office.

It was replete with criticisms of the Post Office: its conduct, decisions, lack of truthfulness and an apparent lack of concern over mounting legal costs. Mr Justice Fraser depicted the Post Office as a public institution that conducted itself as if answerable to nobody: witness statements to the court might not have been written by the witnesses, said the judgement. And he said the Post Office had attacked the credibility of sub-postmasters who had given honest and trustworthy evidence.

His overall conclusion was that bugs, errors and defects in Horizon not only had the “potential” to cause shortfalls in branch post office accounts but had actually done so – on “numerous occasions”.  The judge said his findings applied “both to Legacy Horizon and also Horizon Online.”.

The ruling also confimed that Horizon had a “back door” through which IT engineers working remotely at the system supplier Fujitsu could fix software faults by altering branch post office accounts without the knowledge of sub-postmasters.

Sub-postmasters were vindicated. The judgement estabished that they had not stolen money or fiddled the books to hide their criminality. The system was to blame for numerous unexplained shortfalls because of its tendency at times to show phantom transactions.

Indeed, the judgement also seemed to clear the names of not only the 557 sub-postmasters in the group litigation but hundreds of others who had been prosecuted on the basis of Horizon data. The Post Office has confirmed that there have been 900 prosecutions based on Horizon evidence and 500 convictions. The Criminal Cases Review Commission has referred 47 potentially unsafe convictions of sub-postmasters to the Court of Appeal – an unprecedented number of referrals on one matter. The Commision accused the Post Office of abusing the prosecution system.

How could nearly 1,000 sub-postmasters, each of whom the Post Office had thoroughly vetted for the job, be fraudsters, thieves and liars?  It seemed that the Post Office was prosecuting almost every time the system generated a spate of unexplained shortfalls on branch accounts.

And the courts were almost certain to convict because of a Law Commission “presumption” dating back to the 1990s. The presumption has led to courts accepting flawed computer evidence as reliable. Barrister Stephen Mason showed in his book “Electronic Evidence” (chapter 6) that the courts, based on the defective “presumption”, treat computers as mechanical devices similar to stopwatches – they either work or don’t.

Barrister Paul Marshall, in his paper “The harm judges do – misunderstanding computer evidence: the Lee Castleton case” said that the Law Commission’s “presumption” may encourage prosecutions based on flawed computer evidence.

The defective presumption is covered in articles on this site published this week.

The Post Office’s view?

The Post Office does not share the sub-postmasters’ view of the High Court judgement.

The continuing sharp differences between the two sides raises the question of how much the Post Office’s institutional view of Horizon or the accused sub-postmasters has moved on since the two sides began mediation talks last year.

The sub postmasters regard the judgement as proving, once and or all, that the Post Office was wrong to accuse them of taking money shown on Horizon as missing

But the Post Office says, in essence, that the judgement disproved none of its accusations against individual sub-postmasters. Its controversial interpretation of the judgement is that Horizon had the “potential” for bugs to affect branch balances but did not prove that individual claimants’ accounts were affected.

Nick Read, CEO of the Post Office, says in his letter to MPs on the Business, Strategy and Industrial Committee [BEIS] that the High Court judgement,

“… found that the potential for bugs to affect branch balances in historical versions of Horizon was greater than Post Office believed. The judgment did not determine whether bugs, errors or defects did in fact cause shortfalls in the individual claimants’ accounts but it found that they had the potential to create apparent discrepancies in postmasters’ branch accounts. The current version of the Horizon system was found to be robust, relative to comparable systems but we are not complacent about that, as I detail in responses to other questions…”

But Alan Bates points out that the judgement said bugs, errors amd defects not only had the potential to cause apparent shortfalls on branch sub-postmaster accounts but this actually happened “on numerous occasions”. The defects had also undermined the reliability of Horizon to process and record transactions.

Bates said that the Post Office do not understand how aggrieved the claimant group [557 sub-postmasters who were part of the High Court litigation against the Post Office] feel about the way they have been treated. “It is why we will never give up chasing the costs we incurred in having to expose the real truth behind the appalling condition of Post Office’s Horizon system in the High Court, he said, adding,

“The more I look into the documentation surrounding the court case the more obvious it is to me that Post Office never had the technical expertise or management to operate such a system.  Unfortunately all the times this was recognised in the Post Office Limited board meetings or in external reports, it seems to have been ignored, not only by Post Office but also by its sole shareholder, the government, which is why we are currently fundraising to fund a submission to the Parliamentary Ombudsman to launch an investigation into the failings of those charged with the oversight and control of Post Office in order to recover the costs to the group.

Implications for the Horizon 900

If the Post Office remains unconvinced that the individual claimants in the litigation have cleared their names, where does that leave up to 900 sub-postmasters who have been prosecuted on the basis of Horizon data?

It may be especially difficult for them to clear their names if their records or the relevant Horizon records are no longer available. A further difficulty is that the Post Office may adopt the position the courts take of computer evidence – which is to treat it as reliable. The onus is then on the accused to prove explicitly that a particular bug or defect affected the shortfall in question. None of the 557 sub-postmasters in the High Court litigation proved this in the eyes of the Post Office.

An additional difficulty for the 900 is that they may be able to prove little or nothing without full disclosure of Post Office evidence. Mr Justice Fraser was highly critical of the Post Office’s approach to disclosure.

Post Office responses

Campaign4Change put a series of questions to the Post Office relating to this article. These were our questions and the Post Office’s replies:

Our question to the Post Office:  Nick Read [Post Office CEO] said in his letter to the BEIS committee, “The judgment did not determine whether bugs, errors or defects did in fact cause shortfalls in the individual claimants’ accounts.” This suggests that, in the Post Office’s eyes, the claimants [in the Bates v Post Office litigation] have not proved their innocence. Any comment please?

The Post Office’s reply:

“The claimants and the Post Office reached a mutually agreed, comprehensive resolution to the group civil litigation in December 2019, issuing a joint statement at the time.  The Post Office apologised to those affected and continues to do so.”

Our question: If claimants after a £50m+ court case have not proved their innocence in your eyes, how will anyone whose case is reviewed on the Historical Shortfall Scheme or anyone else you have identified as having been prosecuted using Horizon data, have the slightest chance of proving their innocence?

The Post Office’s reply:

“As the submission to the [BEIS] Select Committee states, the Post Office is determined that past events are resolved fairly.  It also outlines main details of the scheme including that  eligible applications will be assessed by an independent advisory panel of leading specialists in separate disciplines of legal, forensic accounting and retail. The panel is Alex Charlton QC, a leading barrister with particular expertise in software and IT systems; Susan Blower, a forensic accounting partner at BDO and fellow of Chartered Accountants of England and Wales; and Sunder Sandher, an experienced retailer and member of the Independent Retailer Board of the Association of Convenience Stores.  Eligible applications will be assessed by the independent advisory panel in light of the guidance given by the judgments of Fraser J in the group litigation. Applicants are able to claim for losses relating to historical shortfalls, including claims for consequential loss.

“If a postmaster is not content with the outcome of the assessment of their case there is a dispute resolution procedure which includes independent mediation provided by The Wandsworth Mediation Service, a charitable community mediation service chaired by Stephen Ruttle QC who co-mediated the resolution of the Group Litigation.

 “As of 24^th June there have been 618 applications to the scheme – we are keeping this information updated on our website.

“The Post Office is also making strenuous efforts regarding postmasters with past convictions that may be affected by the High Court Judgments in the civil litigation.  We have been working closely with the Criminal Cases Review Commission since applications were first made to them by a number of former postmasters. The criminal appeal courts will now determine these complex issues, with each case resolved on its own specific facts.

“We are also conducting an extensive review of all relevant historical convictions dating back to 1999, to identify and disclose any material in accordance with Post Office’s duties as prosecutor.”

Our question: Why doesn’t the Post Office, after all that former sub-postmasters have been through, clear the names of everyone affected and make amends without further ado or investigation?

The Post Office’s reply:

“The Post Office has taken determined action to address the past and reform for the future.  A settlement in the civil litigation was agreed with the claimants in December 2019. The  joint agreement also included the establishment of the Historical Shortfall Scheme. This offers redress for current and former postmasters who were not part of the litigation and who may have experienced shortfalls related to previous versions of Horizon.

“The Post Office is also making strenuous efforts regarding postmasters with past convictions that may be affected.  We have been working closely with the Criminal Cases Review Commission since applications were first made to them by a number of former postmasters and we are conducting an extensive review of all relevant historical convictions dating back to 1999, to identify and disclose any material in accordance with Post Office’s duties as prosecutor.  Information on historical prosecutions can be found on our website and we will be keeping this updated.”

Comment

One of the oddest aspects of the Post Office IT scandal is that the courts and the Post Office have put the onus on sub-postmasters to prove that on a specific day at a certain time, a particular Horizon bug, error or defect caused each of the shortfalls for which they were blamed.

This has always been impossible for the sub-postmasters. They have faced a lack of full disclosure of Horizon back-office data by the Post Office but have had a limited ability to request end-user reports of transactions on a system that had numerous flaws and which could not always be trusted to properly record transactions or flag duplicate transactions.

If sub-postmasters could not prove bugs in their specific circumstances, it is equally unlikely the Post Office could prove that none of the Horizon bugs, errors or defects caused the shortfalls in question.

And how would the Post Office be able to prove that Fujitsu had told the Post Office of every bug, error and defect – at least the ones of which Fujitsu was aware? How would the Post Office prove that it was aware of every instance when a Fujitsu engineer, in fixing a bug, had or had not altered the branch accounts without the knowledge of the sub-postmaster?

It’s a mess – perhaps difficult or impossible for each side to prove or disprove how Horizon was performing at the specific time and date of each shortfall in question especially as, according to Mr Justice Fraser, record-keeping was not always up to standard.

Arguably,  the Post Office prosecuted and made accusations when the system showed money was missing because that was easier than institutionally conceding that the system that served 11,000 post ofice was flawed. It was especially easy to prosecute because the courts had adopted a Law Commission “presumption” that when the prosecution presented computer evidence it was to be treated as reliable.

Perhaps the Post Office’s undeclared institutional attitude was that those who were wrongfully accused and whose lives were destroyed was the price to pay to catch any genuine thieves and fraudsters.

It is hard to see that the reviews of the Horizon 900 prosecutions will take any of these uncertainties into account. The Post Office wants each case to be handled individually on its merits. But are each side operating in near darkness?

The Post Office has impressive, independently-minded people looking at hundreds of potentially wrongful prosecutions. But they can only make determinations based on the evidence before them.

Articles on this website on 7 and 8 July showed that it is almost impossible for the accused facing faulty computer evidence in criminal and civil courts to prove their innocence. It is therefore mystifying how the Horizon 900 – if that’s the number who  come forward – will prove that Horizon affected their particular branch accounts at the time in question. Those profound doubts remain however well-qualified and able the review panel.

On the public conscience, therefore, are the prosecutions of about 1,000 people and the convictions of 500 people. The accustions against them are derived from data produced by a flawed computer system. But instead of clearing the names of all those affected, a sort of general amnesty, which the public conscience cries out for, there is the real possibility that few if any of the Horizon 900 will be able to clear their names because the Post Office insists that each case be reviewed individually on its merits.

The Post Office IT scandal deepens.

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Time sensitive: Alan Bates has launched an appeal for donations to raise £98,000 for a QC’s complaint to the Parliamentary Ombudsman of maladministration by the Department for BEIS over its failure to stop the Post Office making accusations and prosecuting in the criminal and civil courts on the basis of data derived from its flawed Horizon system. More than 1,000 people have donated so far but the appeal closes in a few days. The appeal has raised about £71,000 so far.

Update

Sub-postmaster Mark Baker who, on behalf the Communication Workers Union, represents victims of the Horizon scandal, makes an important point in his tweet this morning that Mr Justice Fraser’s ruling changed the burden of proof.  Under the ruling, the Post Office has to show that any loss was the fault of the sub-postmaster. Before the ruling, the Post Office had put the burden of proof on sub-postmasters to show they hadn’t taken money Horizon showed was missing. The big question now is whether the Post Office and its independent panel will apply the new burden of proof retrospectively in reviewing all the cases before them. If fairness dictates the terms of the reviews, the panel will apply the new burden of proof.

Electronic Evidence – Stephen Mason and Daniel Seng  (NB chapter six)

Presumption concerning the dependability of computer evidence – Ladkin, Littlewood, Thimbleby and Thomas

The harm that judges do – misunderstanding computer evidence: Mr Castleton’s story – Paul Marshall

Seema Misra criminal trial transcript

Post Office cover-up – they wanted it all to go away – Nick Wallis