Official hearing page

5 December 2023 – David Posnett

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(11.00 am)

Mr Beer: Good morning, sir, can you see and hear us?

Sir Wyn Williams: Yes, I can, thank you.

Mr Beer: Thank you very much. Sir, as everyone knows, we’re sitting today between 11.00 am and 2.30 pm, and certainly no later than 2.30 pm. If it suits you, sir, I would propose that we take half an hour’s break between 12.30 and 1.00 so that the evidence sessions are split into 2 one and a half hour slots.

Sir Wyn Williams: That’s fine by me, and I take it that’s okay with the transcriber?

Mr Beer: We’ll see how we go, if it becomes a problem, then I’m sure she will let us know.

Sir Wyn Williams: Yes. Fine.

Mr Beer: Sir, can I call David Posnett, please.

David Posnett

DAVID POSNETT (sworn).

Questioned by Mr Beer

Mr Beer: Good morning, Mr Posnett. My name is Jason Beer and I ask questions on behalf of the Inquiry. Can you please tell us your full name, please.

David Posnett: David Posnett.

Mr Beer: Thank you. Thank you very much for coming to give evidence to the Inquiry today and for the provision of a detailed witness statement to assist us in our investigation.

Can we start by looking at that document, please. I think you’ve got it in front of you at tab A1. It should be dated 4 October 2023 and, excluding the exhibits index, it’s 44 pages in length.

David Posnett: Yes, that’s correct.

Mr Beer: Is that your signature on page 44?

David Posnett: It is, yes.

Mr Beer: Are the contents of that witness statement true to the best of your knowledge and belief?

David Posnett: Yes.

Mr Beer: Thank you. Now, a copy of that is going to be uploaded to the Inquiry’s website. I’m not going to ask you questions about every part of it, just selected elements of it. You’re here today to assist us with the issues arising in Phase 4 of the Inquiry, which is the investigation and prosecution of subpostmasters for criminal offences.

Can I start, please, with your career. I think you worked for the Post Office for 31 years; is that right?

David Posnett: That is right, yes.

Mr Beer: I think you started in ‘87; is that right?

David Posnett: It was 1986.

Mr Beer: ‘86, that’s right, and finished in 2017?

David Posnett: That’s correct, yes.

Mr Beer: So ‘86 to 2017, 31 years?

David Posnett: Yes.

Mr Beer: You started life in the Post Office as a counter clerk; is that right?

David Posnett: That’s right, yeah.

Mr Beer: I think that job lasted for eight years until about ‘95, is that right: 9 years until ‘95?

David Posnett: About that. It’s about that, yes.

Mr Beer: Then in 1995 you started a new role as an Auditor; is that right?

David Posnett: That’s correct.

Mr Beer: Whereabouts were you based as an Auditor?

David Posnett: I was based in Guildford.

Mr Beer: Did you have any professional or other qualifications to be an Auditor?

David Posnett: No.

Mr Beer: I think you stayed in that role for four years or so until 1999, when you took up a job as a joint business testing analyst; is that right?

David Posnett: Yeah, I think it was the back end of 1999, yes.

Mr Beer: We’re going to come back to that in a moment because the work that you did there may be of relevance to the Inquiry.

That lasted until 2000; is that right?

David Posnett: It lasted until the end of December 2000, yes. It was a few months, yeah.

Mr Beer: So a year or so?

David Posnett: No, it was during 1999, about midway or a bit further, and I finished that role at the end of December ‘99.

Mr Beer: Oh, it was just in 1999, was it?

David Posnett: Yes.

Mr Beer: Right, okay. So about six months, then?

David Posnett: May have been less than that but, roughly, it was a few months.

Mr Beer: In your statement you say in 2000 you started work as an Investigation Manager based in Twickenham; is that right?

David Posnett: Yes.

Mr Beer: As an Investigation Manager, were you managing investigations or managing people?

David Posnett: Investigations.

Mr Beer: Okay. Did you manage any people?

David Posnett: No.

Mr Beer: Okay. You moved, I think, from Twickenham to Woking and in 2004 you were promoted to an Investigation Team Manager; is that right?

David Posnett: That’s correct.

Mr Beer: Did that mean that you then started managing people as well as investigations?

David Posnett: Yes.

Mr Beer: How many people were in the team that you managed?

David Posnett: It fluctuated but roughly between four up to eight people.

Mr Beer: Did they all work in Woking too?

David Posnett: No, they didn’t. They were dispersed geographically.

Mr Beer: Did they home work or did they have an office they could come into?

David Posnett: Back then we had offices.

Mr Beer: Right. How did you monitor or supervise these four to eight people?

David Posnett: Did regular one-to-ones, I usually went to their office to conduct a one-to-one – might have been every month or six weeks, or so – and team meetings, we’d sort of have at my office. So I’d generally go to them but – the one-to-ones – for team meetings, they’d come back to my office.

Mr Beer: How frequently were the team meetings where everyone in the team came in?

David Posnett: Ooh, probably every month or two.

Mr Beer: Were they scheduled, “We’re having a team meeting every month or two”, or were they only when the occasion arose?

David Posnett: They were scheduled. We’d have a meeting, I think, and at that meeting we’d pencil in the date for the next meeting.

Mr Beer: Was there sort of a standing agenda for those?

David Posnett: Some bits were standing agenda, like any new Post Office related products or transactions, et cetera, and also I used to print off everybody’s current cases, and they could select a case or two if it was unusual and talk about it, and it was also used for, if somebody had an investigation and needed someone to help them on the day of when the operation concluded. You know, because we’re all in the same room, we could sort those sort of things out.

Mr Beer: When an Investigation Manager submitted a file for a decision on prosecution, did that have to come through you before it got to Legal Services or to somebody else?

David Posnett: I think it went direct to the Casework Team and then up to the Criminal Law Team.

Mr Beer: So it didn’t have to come through you?

David Posnett: I don’t think it came through me but they would email me, for example, their reports, maybe.

Mr Beer: Okay. So you would see something about the cases that were going off to the Criminal Law Team –

David Posnett: Yes –

Mr Beer: – investigated by members of your team?

David Posnett: Yes.

Mr Beer: Would you conduct reviews of their files, the Investigation Managers?

David Posnett: I didn’t conduct reviews but I did read, obviously, some of the reports.

Mr Beer: What would cause you to read the reports?

David Posnett: Because I’m their manager, just to make sure there wasn’t any horrendous errors or anything wrong.

Mr Beer: So you’d have a good idea of the things that your team were investigating, the nature of the investigations that they were carrying out, and the conclusions that they reached in their investigation reports?

David Posnett: Yes.

Mr Beer: To whom did you report in this period? I’m talking about 2004 onwards when you were the Investigation Team Manager?

David Posnett: When I was the Investigation Team Manager I reported initially to Manish Patel, who was the Senior Investigation Manager, and then I think after him it was Trevor Lockey. I think there were – and then perhaps Dave Pardoe, after that.

Mr Beer: Was there any one Senior Investigation Manager?

David Posnett: I believe so, yes.

Mr Beer: I think you stayed in that role until 2007; is that right?

David Posnett: Yes.

Mr Beer: In that year, 2007, and then 2008, you worked as a Casework Manager based in Croydon; is that right?

David Posnett: It was, yes, for a number of months between ‘07 and ‘08, yes.

Mr Beer: What was the function of the Casework Team in Croydon?

David Posnett: The function of the Casework Team was – it was sort of split into two. On one side was banking, the Post Office Card Account. So there was an assistant manager and some admin staff who primarily dealt with DPA requests from law enforcement in relation to the –

Mr Beer: Data Protection Act requests?

David Posnett: Yes. Then the other side was another assistant manager and admin staff, who dealt with investigations. So, as I mentioned earlier, the case file would come into the Casework Team, they’d complete a spreadsheet with, I don’t know, date of interview, or date of summons, or anything relating to the case, and then they would send that up to the Criminal Law Team.

Mr Beer: So what did they add, the Casework Team, what was their purpose, their function, if you like? The bit that – not the banking side, the investigation side.

David Posnett: Well, the investigation side, with the spreadsheet that we used, which was – I can remember was horrendous, it was the movement of the case throughout its life-cycle and to ensure that it’s dispatched to the relevant people and emails sent to relevant stakeholders. And so it was – it was like the central admin for a case.

Mr Beer: Was it only an administrative function or did it perform any tasks of substance in relation to the investigation?

David Posnett: In relation to the investigation, possibly obtaining the audit requests from Fujitsu.

Mr Beer: Anything else, other than that? We’re going to come back to that because I think you’ll realise that’s quite a big topic for the Inquiry. So that function sat within the Casework Team in Croydon, obtaining audit data from Fujitsu?

David Posnett: Yeah.

Mr Beer: Anything else?

David Posnett: I can’t think of, at the moment, anything else.

Mr Beer: How many people worked within the Casework Team on the investigation side of the house?

David Posnett: There was two or three.

Mr Beer: They were managed by one assistant manager; is that right?

David Posnett: That would include the –

Mr Beer: That would include the assistant manager?

David Posnett: Yeah.

Mr Beer: Did you sit underneath the assistant manager?

David Posnett: I sat above the assistant manager.

Mr Beer: Above, okay, and your title then was?

David Posnett: Casework Manager.

Mr Beer: Casework Manager, okay. At that time to whom did you report?

David Posnett: I think it was Dave Pardoe, at that stage.

Mr Beer: Was he based in the Croydon office?

David Posnett: He wasn’t, no. He was up in St Helens, I think he lived.

Mr Beer: Did you have meetings with him, regular contact with him or, because of the geographical separation, not?

David Posnett: I had contact with him. I don’t recall it being regular.

Mr Beer: Then, I think, later in 2008, you became a Fraud Risk Manager; is that right?

David Posnett: Yes.

Mr Beer: So that moved you out entirely of the Casework Team in Croydon; is that right?

David Posnett: Yes.

Mr Beer: That lasted until 2010?

David Posnett: Yes.

Mr Beer: What did that job entail: Fraud Risk Manager?

David Posnett: It was primarily running fraud risk programmes, for example the fraud risk programme on Crown Office cash losses, scratchcards, Overnight Cash Holdings, Post Office Card Account, rejected postage labels. So I’d say 90-odd per cent of it was these particular products or transactions and we’d draft up a programme to address risks and weaknesses in those areas.

Mr Beer: By “programme”, do you mean a computer program or a schedule of work?

David Posnett: A schedule of work. It was the Crime Risk Team that was based within the Security Admin Team who identified these as more high-risk areas.

Mr Beer: Then I think in 2010 you became an Accredited Financial Investigator; is that right?

David Posnett: Yes, it took a while to get the accreditation but, yes.

Mr Beer: You stayed in that job until 2014; is that right?

David Posnett: Yes.

Mr Beer: I think your accreditation was given by the NPIA, the National Police Improvement Agency; is that right?

David Posnett: That’s right, yes.

Mr Beer: What was your role as an Accredited Financial Investigator?

David Posnett: My role was basically to recover losses on behalf of the business.

Mr Beer: So this is, essentially, proceeds of crime work; is that right?

David Posnett: Yes, yes.

Mr Beer: Was that all post-conviction work?

David Posnett: Confiscation was post-conviction. Pre-conviction would be things like restraint orders and production orders.

Mr Beer: Whereabouts were you based when you were an Accredited Financial Investigator?

David Posnett: That would have been in, I think, Old Street in London.

Mr Beer: Then in 2014 and until 2015, you worked as a Security and Investigation Team Leader; is that right?

David Posnett: Yes.

Mr Beer: You retained your title as an Accredited Financial Investigator; is that right?

David Posnett: That’s right.

Mr Beer: Did you do any financial investigation work?

David Posnett: Yes, but it sloped off during that period. I mean, to be honest, I did many of the roles I’d previously done in that last year.

Mr Beer: As a Security and Investigation Team leader, what was your function?

David Posnett: Again, it was, as I described in 2004, manage a team of people but it also had a security element at that stage. So the team would deal with burglaries, robberies, cash centres, security visits, et cetera.

Mr Beer: Then, finally, I think in 2015 until 2017, you were a Branch Standards Manager?

David Posnett: Branch Standards Field Manager, yes.

Mr Beer: What did a Branch Standards Field Manager do?

David Posnett: The main thrust of that role was to check that subpostmasters or staff were having the correct conversations with customers in relation to items they were posting over the counter. One of the focuses was whether items were prohibited or restricted and to make sure that they were asking the right questions.

Mr Beer: Was there any investigation function within that role?

David Posnett: No.

Mr Beer: Can we go back, then, having looked briefly at each stage of your career in the Post Office, to the time that you were involved in 1999, and I think your statement says into 2000, as a Joint Business Testing Analyst for Horizon. Can you help us just again – I think I missed it earlier – how long you worked for as a joint business testing analyst for Horizon?

David Posnett: If it was mid-1999, I definitely finished on – at the end of December that year. So I would say six months, maybe a month or two more or less.

Mr Beer: Tell us what a Joint Business Testing Analyst in relation to Horizon did?

David Posnett: Yeah. So I was based within ICL Pathway, as it was known then.

Mr Beer: So you mean physically based?

David Posnett: Yes, the Head Office is in Feltham, and they had quiet a large room called – I think it was called the Rig and, within that room, were lots of computer terminals that reflected the names of post offices. And they chose football teams so you’d have Liverpool Post Office, which might be a single terminal; you could have Chelsea post office, which might have three terminals, a bigger, busy office that would represent.

Mr Beer: A slightly better post office, presumably?

David Posnett: Potentially. And my role, and a colleague who joined at the same time as me, we would basically get scripts and we would literally have to follow these scripts, so it would say go to Liverpool Post Office, log on, sell a first class stamp, take cash for it, and literally just follow a basic script like that.

Mr Beer: So a rig was, it was a dummy system; is that right?

David Posnett: Yes, yeah.

Mr Beer: Was it self-contained, a closed system, or did it connect with the outside world?

David Posnett: I don’t think it connected with the outside world. That’s basically what we did, follow these scripts and, when we’d finished, we’d hand the script over to – I think it was the back office team. So I don’t know whether the system communicated with them but that’s what we did. It was just literally following these scripts.

Mr Beer: Were you aware, in this time, as a testing analyst, of significant problems arising with the development and testing of the Horizon system?

David Posnett: I can recall two things: number 1, the system was meant to have the Benefits Payments System attached to it, so to pay out pensions, and that was pulled, I think, during the time I was there, which was quite significant. I don’t know the reasons why but the Government said we’re not going to be going down that road.

And the other noises, for want of a better word, I can remember, were people said that Horizon was chosen – sorry, Fujitsu or ICL Pathway were chosen because it was the cheapest option. So I don’t know which other companies tendered for the system, but Fujitsu or ICL Pathway were chosen.

Mr Beer: What about problems at an operational level with the system? Were you aware of, in this testing phase, issues and problems with the operation of Horizon?

David Posnett: I was aware of issues whilst testing, because that’s what you do in the testing environment.

Mr Beer: That was the purpose of it?

David Posnett: Yes. But, for example, you know, if the script said “Issue a motor vehicle licence” – and this is just an example, not an actual example – but you’d go to the screen and the motor vehicle licence wouldn’t be there. So you’d have to annotate the script to say, “Can’t perform this transaction because the icon is not there”, and that would go to the back office team and I think they’d look at it and then rectify that issue.

The only problem I do remember was I think there was a Northern Ireland icon and –

Mr Beer: A Northern Ireland icon?

David Posnett: Yes. It was a picture of somebody with a green sweater and it was raised that perhaps this green sweater should be made purple because of political situation.

Mr Beer: Were you aware of what happened when a problem arose in testing? You wanted to issue a DVLA licence and the script told you to, and it – the system couldn’t, and you put – you handed in that script marked up in the way you’ve said saying, “Can’t do that function”. Were you aware of the next steps or were you a sort of a smallish cog in a larger set of machinery?

David Posnett: I was a smallish cog. That would be relayed back to the back office team and then, after that, I don’t know. We would then get another script to work on.

Mr Beer: So you wouldn’t see what the solution was to that problem or, indeed, whether there was a solution to it?

David Posnett: I wouldn’t see it and, to be honest, I wouldn’t understand anyway, even if I did see it.

Mr Beer: Why wouldn’t you understand if you did see it?

David Posnett: Because that would be far too technical for me.

Mr Beer: I think it’s right that you didn’t have any qualifications or experience in computing?

David Posnett: No.

Mr Beer: Is that –

David Posnett: That’s right, yeah.

Mr Beer: Were you aware at this time of something called AIs or Acceptance Incidents?

David Posnett: Not that I recall, no.

Mr Beer: Do you remember any of these testing issues affecting settling accounts or balancing?

David Posnett: No.

Mr Beer: Is that “It’s 23 years ago now and, therefore, I can’t remember one way or another what each of the issues were” or “I don’t think any of them involved balancing issues”?

David Posnett: Again, I can’t remember, specifically, 23 years ago but there may have been – I mean, when I mentioned the scripts that we used, if it ended up with a cash account, for example, and before that, there were problems in finding icons and things, we may not have finished the script because we couldn’t end up doing the cash account that would come out the way it should have done. But I can’t remember.

Mr Beer: Can we just look at one example of maybe one of the things you were doing when you were a Joint Business Testing Analyst, by looking at FUJ00021692. Can you see this is a document called a PinICL; can you see that?

David Posnett: I can, yes.

Mr Beer: Do you remember PinICLs?

David Posnett: I can – the word “PinICL” rings a bell but I can’t remember it.

Mr Beer: You can’t remember what their function was or who issued them or –

David Posnett: No.

Mr Beer: – what their purpose was?

David Posnett: No.

Mr Beer: We can see that this one was opened on the 2 June 1998 and the summary of it, to the left, is EPOSS, do you remember what EPOSS was?

David Posnett: Is that Electronic Point of Sale.

Mr Beer: Yes, and that was a problem. It says the transaction logs were not working with EPOSS?

David Posnett: Yeah.

Mr Beer: I take it you don’t remember that as a problem?

David Posnett: I don’t remember that as a problem and that was before I had that role anyway.

Mr Beer: That’s what I wanted to ask you about, if I may. If we turn to page 5, please. Look at the bottom half of the page, thank you. Can you see, I think it’s five lines in now, it says:

“The ‘BA/POCL Reports and Receipts’ document reflects the system. It does not specify the requirement for transaction logs. The requirement is to offer the same functionality as the existing system. Two joint testers (Chris Phillips and Dave Posnett) are currently checking the transaction log functionality on Horizon (a) against the documented functionality of the existing system (b) for usability (which is what this PinICL was originally raised for).”

So a number of questions arising from that. Firstly, this PinICL was raised in June 1998 –

David Posnett: Yes.

Mr Beer: – and this entry is in September 1998, and it refers to you, along with Chris Phillips, as a joint tester?

David Posnett: Yes.

Mr Beer: Do you think you were, in fact, doing the joint testing or had the role as a joint tester earlier than you thought?

David Posnett: If those dates are correct, then, yes. But I’m sure it was 1999. But Chris Phillips was the other guy who joined the same time as myself. I thought it was a few months in ‘99 because I can remember the Millennium Bug that everyone thought all the computers in the world were going to stop, so I didn’t think it was 1998. I may be wrong.

Mr Beer: If this is accurate, and we’ve got no reason to think that the dates on here are wrong, it looks like in the autumn of ‘98 you were performing the role of a joint tester?

David Posnett: Yeah.

Mr Beer: It refers to you checking the transaction log functionality on Horizon. That sounds something slightly different to running a script, seeing whether a test rig could perform a function like issue a DVLA licence; would you agree?

David Posnett: That element does sound different, yes.

Mr Beer: What you understand it is saying here or it is recording you as doing: checking a transaction log functionality?

David Posnett: It says that, yes.

Mr Beer: Yes, but what do you understand it to be referring to?

David Posnett: That we were trying to obtain transaction logs from the system within the rig.

Mr Beer: What do you understand transaction logs to be?

David Posnett: A record of all the transactions entered on the terminal over a given time frame.

Mr Beer: Yes, thank you. That can come down, please.

How collaborative was the joint testing team, ie how much exchange of information was there between you about the issues or problems with the system?

David Posnett: My recollection was, as I’ve outlined, we followed the scripts and those scripts, whether they’d worked out correctly or not, were passed to the back office team for review and to rectify anything, if anything needed rectifying.

Mr Beer: When you left this role, what was your view as to the reliability and integrity of the data that Horizon produced?

David Posnett: I don’t recall having any concerns because, although it was a new role for me, my understanding was that the testing environment was to test, test, test, identify issues and then people with more technical knowledge would rectify them. So I don’t think I gave it any I serious thought. I thought that was par for the course for that particular role.

Mr Beer: What was the chat, the conversation, the feeling amongst those with whom you were working, as to the adequacy or otherwise of the Horizon system? Was it seen as problematic or difficult? Were people saying, “Look, there are lots of problems with this, we’ve got a rollout coming around the corner, a deadline to meet”?

David Posnett: Yeah. I don’t recall any conversations but I do recall that the rig was down quite often. So, for example, we’d have a script and we’d have to go and do some work, but the technicians were working on the rig. So, to be honest, there were hours where we had to just get on with other things whilst waiting to go in. So there were problems but I wouldn’t know what those problems were because we were just told when we could go in and start following the script again.

Mr Beer: So what was your overall impression of Horizon when you walked away from this job?

David Posnett: It was a new computer system for all post offices. We’d mentioned EPOSS there. I think it was also partly based on ECCO, which Crown Offices had.

Mr Beer: Had been using for a while?

David Posnett: Yes.

Mr Beer: Was there anything in particular about EPOSS that had raised concerns about the operation and functionality of the EPOS System?

David Posnett: Not that I can recall, no.

Mr Beer: Were you involved in any way in the training of subpostmasters in the rollout of Horizon?

David Posnett: No.

Mr Beer: Did you have any function concerning the rollout of Horizon?

David Posnett: No. When I finished that job, at the end of 2000, after Christmas, I then became an Investigation Manager, or temporarily became an Investigation Manager, until there was interviews for the post on a permanent basis.

Mr Beer: Again, when you left, would you say that your experience was that testing had revealed some problems, no problems or significant problems with the operation of Horizon?

David Posnett: I would personally say some to significant, because I don’t know what the norm would be, in terms of errors on a computer system during a testing phase.

Mr Beer: Can you remember delays to the programme of rollout due to technical problems with Horizon?

David Posnett: No. All I can recall is I think it was meant to be rolled out in 2000 and it was rolled out in 2000. If there were a month or three delays, because I wasn’t in that role then, I don’t know.

Mr Beer: Can we just look at something that you said about this period of time years later, in 2015, by looking at two documents alongside each other, if we may. Firstly, POL00063370 and, secondly, POL00118547. Thank you.

We can see that this is, on the left-hand side, a Post Office Limited submission to a BIS – Business Innovation and Skills – committee inquiry into the Post Office Mediation Scheme, which was conducting an investigation in 2015. That’s the document on the left-hand side.

David Posnett: Yeah.

Mr Beer: On the right-hand side, we can see an email from you to Helen Dickinson and Rob King, saying:

“I’ve trawled through this and made some comments (yellow and blue highlights). Not many, though as a lot of it is technical or not within my knowledge to comment further. Witness statement associated to reflect Horizon training.”

You say:

“As an aside (and my personal view) I really do think there are cases where Horizon is clearly irrelevant. The subpostmaster admits theft, says what he did with the money, et cetera. No grounds to even cite Horizon. George Thompson mentioned the Rudkin case at the Select Committee hearing. There are others and I think (without mentioning names, details, etc) we could be more on the front foot if these were flagged to MPs, Second Sight, etc.”

So Parliament is conducting an inquiry, an investigation, the Post Office has given some evidence already through Mr Thompson, and this is, on the left-hand side, a submission to that Parliamentary committee, and you’ve marked up this draft submission.

Can we just look at page 5, please, on the left-hand document, and have a look at training at 2.1. Thank you.

The Post Office was proposing to tell the Committee that it heard evidence on the training available to subpostmasters at the time of Horizon’s introduction:

“This evidence focused on the back of training materials provided to subpostmasters at the relevant time”, et cetera.

Then next paragraph:

“As presented to the Committee, one might be left with the impression that the training and support ended there. On the contrary, on the introduction of Horizon, two different training courses were then provided by ICL Pathway. The first was for subpostmasters and the second was for staff. This training was delivered prior to the branch migrating to Horizon. All subpostmasters left the course with a Horizon User Guide and they were all also subsequently provided with Quick Reference Guides.”

Then I think the part that you added, this would have been marked blue or yellow in the original, was:

“It was also a pass/fail course (so if they weren’t up to scratch they weren’t allowed to work with Horizon, it wasn’t a case of ‘going through the motions’ – see associated witness statement which may provide more ammunition).”

Now, this you were writing in 2015, yes?

David Posnett: Yes.

Mr Beer: Yes? We’ve seen the email –

David Posnett: The email, yes.

Mr Beer: – enclosing this document with these mark-ups on it, yes?

David Posnett: Yes.

Mr Beer: What direct experience had you got of the provision of training to subpostmasters?

David Posnett: Sorry, could you repeat that?

Mr Beer: Yes. What direct experience had you got of the provision of training to subpostmasters at the rollout stage?

David Posnett: None.

Mr Beer: But you’re here providing “ammunition”, it says, or you say, to those that are compiling this submission to Parliament. If you had no direct experience of the provision of training to subpostmasters, why were you providing the ammunition?

David Posnett: Firstly, I don’t remember or recall that document. Secondly, I think, when we were investigating cases, one of the things we got on occasions were the training records and it would have been from those we were informed that it was a pass/fail course. So that’s probably where I took that from.

Mr Beer: So this addition that you’re suggesting to the submission to Parliament comes from your knowledge, not from the period that I was talking about as a tester in rollout, but later, when you were an Investigator; is that right?

David Posnett: Yes.

Mr Beer: To what extent did you look into the adequacy of training as an Investigator?

David Posnett: I think it was – if we obtained the part the – well, it would have to be a pass, otherwise it wouldn’t have been working in the Post Office and, again, I can’t remember, I don’t know whether it was simply a pass or whether there was some text “Competent with this”, “Okay with that”, or “Issues with this”, et cetera. So it gave picture of a subpostmaster or a clerk as to how well they were coping with the system during training.

Mr Beer: Did you investigate the quality of training?

David Posnett: No.

Mr Beer: Did you ever hear subpostmasters say that the training that they received on Horizon was not adequate or satisfactory?

David Posnett: I have heard that, whether it was my cases or – I can’t recollect specific examples but that does ring a bell and, if I am honest, when I trained can be a counter clerk, I think it was something like two or three weeks in a classroom and then two or three weeks with somebody sat behind me watching everything I did, whereas this is obviously a couple of days’ or one day’s training.

Mr Beer: That wasn’t the message that you were seeking to convey here, though?

David Posnett: No, the message –

Mr Beer: You were providing ammo to beef up the Post Office’s case to Parliament?

David Posnett: Yeah, I don’t remember this at all. What I was doing – I think that’s factual. It was also a pass or fail course, et cetera.

Mr Beer: But what it doesn’t do is provide that more nuanced position that you’ve just expressed, namely “Look, when I was a counter clerk, I spent two or three weeks being trained, and that was reduced to a couple of days, and then I think a day, and then even less”?

David Posnett: Yeah. Having said that, these people may already have been subpostmasters and clerks, so they would know how to work in a post office. I think it was purely the Horizon training, not the Full Monty of counter clerk work.

Mr Beer: By this time, 2015, I realise we’re jumping right ahead at the moment, were you asked to positive views only when making comments on this document that was to be submitted to Parliament?

David Posnett: I don’t recall because I don’t recall the document.

Mr Beer: Would you naturally provide ammunition for the Post Office’s case when making comments?

David Posnett: I don’t think so, no.

Mr Beer: You would express any negative views of Horizon, the training of subpostmasters, the operation of the system, the quality of investigations and the like too, would you?

David Posnett: I’d like to have thought so, yes.

Mr Beer: Would Post Office Management, if we just go back to the email – Helen Dickinson, you’ll see that she was the Security Operation Team Leader North, yes; do you remember her?

David Posnett: Yes.

Mr Beer: Would Post Office Management be receptive to bad news stories about Horizon in an exercise like this?

David Posnett: At the time – I think my view at the time was, if it was good news, it was good news; if it was bad news, it was bad news. Again, I don’t recall it, but I’d like to think that I would have told the truth, you know, whichever side that fell on.

Mr Beer: You wouldn’t have felt any inhibition in 2015 of giving additions to this document that were negative or uncomplimentary about Horizon?

David Posnett: I wouldn’t have an issue with that, although at the time the – or the messages were that there is nothing wrong with the system. So whether that’s reflected my mindset, but, you know, I’d like to think, if I saw something that wasn’t right, I would say it.

Mr Beer: Okay. Well, we’ll be coming back to this later. That can come down, both those documents can come down. Thank you.

You have told us already that you worked as an Investigation Manager between 2000 and 2004. Can we look, please, at POL00106867, please. Can we start with page 9, please. This is part of a long email chain, years later in 2010, and can you see that you’re copied in on this email from Sue Lowther to a group of people.

David Posnett: Yes.

Mr Beer: Can you remember who Sue Lowther was?

David Posnett: I think she was the Head of Information Security.

Mr Beer: That’s completely accurate, it fits with her signature block. If we just read the start of this chain, insofar as you were included within it.

“As was discussed on the conference call and taking into account Rob’s comments, to confirm that what we are looking at is a ‘general’ due diligence exercise on the integrity of Horizon, to confirm our belief in the robustness of the system and thus rebut any challenges.”

Do you remember this, early 2010?

David Posnett: I don’t remember it, but this is an example, as I said, of the messages that there’s nothing wrong with Horizon, and that’s not having a go at Sue. I think she was in the same position as quite a few of us.

Mr Beer: Looking at the email there, do you think that you were part of that conference call?

David Posnett: Probably. I can’t remember it.

Mr Beer: In any event, Ms Lowther continues:

“The Information Security Team have looked at the information that has been forwarded to them, re the above and it seems that the issues raised are mainly around procedural items and about ‘Accounting’ reconciliation.

“To enable us to examine the integrity of Horizon from an Information Security perspective we need input from a number of areas.

“1. A description of the accounting process from the business perspective, including the interfaces between Horizon and POLFS and the process by which ‘error notices’ are generated.

“2. The identity of all the offices making allegations, together with a list of loss declarations from those offices.

“3. A report from Service Delivery of all the problems they have received through the Live Service Desk.”

Then there is some attribution of actions, and then at the end:

“Once we have that information, I can then put together a plan of how we will examine the system ‘integrity’ of Horizon and the resource required to complete it.”

Do you remember this proposal to undertake a due diligence exercise on the integrity of Horizon, the purpose of which was to confirm an existing belief in the robustness of the system?

David Posnett: I don’t recall it, no.

Mr Beer: If we go forwards, please, to page 7, and scroll down, please. Just scroll down a little further, please. Mr Wilson, a lawyer – do you remember him, Rob Wilson –

David Posnett: I do, yes.

Mr Beer: – says:

“I note that you wish to examine the integrity of Horizon from an information security perspective.”

Then just on to page 9:

“What does this mean?”

Yes?

David Posnett: Yes.

Mr Beer: Then back to page 7, please. Middle of the page. Ms Lowther:

“Essentially it means we would wish to examine the Security controls that we have specified for Horizon and those systems with which it interfaces are indeed in place and working correctly.”

Then top of the page, please. Mr Wilson says:

“We have additional difficulties in relation to challenges to Horizon. Today I have been made aware of a prosecution being conducted by the CPS where Horizon is being challenged. The case may have been already identified by you. The difficulty, however, will be our lack of control over any case that is not being prosecuted by my team.”

Just stopping there, before we get to the questions that arise at the end of this chain, in what circumstances were cases prosecuted by the CPS?

David Posnett: I think they were few and far between but it may be, for example, a subpostmaster, a member of staff was dealing from him and, if they went directly to the police, they may investigate it and they may wish to have the transaction event logs or some other Fujitsu documents to examine.

Mr Beer: The view that Mr Wilson expresses here, was that one that was circulating within the investigation community, namely that, when the CPS are the prosecutors and the police the investigators, there is a lack of control by the Post Office over what happens within the case?

David Posnett: I don’t recall it being a – I mean, I don’t recall this anyway but I don’t recall it being communicated to others.

Mr Beer: Can you recall it being a problem or being seen as a problem that –

David Posnett: I don’t recall it but I can understand what he’s saying that, yes, if it’s not being dealt with by his team, it’s obviously not as good as if it were being dealt with by their team.

Mr Beer: I think that’s a matter of debate but here he’s talking about control over a case. What would you understand the reference to “control” to be, in the context of a debate over a challenge to Horizon?

David Posnett: My view on this is that the Legal Services or Criminal Law Team by and large would have oversight over all cases. So, I mean, they could see patterns or problems, et cetera. If it was being – a case that was being dealt with by the police or another law enforcement agency, they wouldn’t have sight of the potential problems or issues.

Mr Beer: That’s one aspect of control, namely sight, potentially. But wouldn’t you understand control also to mean control over what is disclosed and what is not disclosed?

David Posnett: I don’t read it like that. The difficulty, however, will be our lack of control, if the control is about disclosure, then I would imagine it’s up to the police or other law enforcement agency, who is investigating the case, to deal with the disclosure.

However, having said that, yes, I accept that, if the police were unaware of potential problems or issues with Horizon, then they wouldn’t know to pursue that and disclose anything. If that makes sense.

Mr Beer: Isn’t what Mr Wilson saying to you and the others here, that, “Look, we’re planning to potentially investigate Horizon integrity. We might have to disclose that to the police and the CPS in independently investigated and prosecuted cases, we will lose control over that information”?

David Posnett: Yes.

Mr Beer: “Whereas, if it stays within the post office Investigation Team, we retain control over that information”?

David Posnett: Yes.

Mr Beer: Can we go, please, to page 1. I should have said at the bottom of the page, please.

You say, in relation to this chain:

“Can we please ensure that Rob Wilson … is kept apprised of the situation …”

If we just read on to page 3.

“… and included in any further meetings/updates on this subject. Our prosecution cases have faced an increase in challenges as well as our civil cases, so the activities outlined below and indeed going forward, are applicable to both legal teams.”

So you wanted Mr Wilson cited on this idea of a review, a due diligence exercise on Horizon?

David Posnett: Yes.

Mr Beer: Can we see what he replied to you, please. Page 1, he says:

“If it is thought there is a difficulty with Horizon then clearly the action set out in your memo is not only needed but imperative. The consequence however will be that to commence or continue to proceed with any criminal proceedings will be inappropriate. My understanding is that the integrity of Horizon data is sound and it is as a result of this that persistent challenges that have been made in court have always failed. These challenges are not new and have been with us since the inception of Horizon as it has always been the only way that defendants are left to challenge our evidence when they have stolen money or where they need to show that our figures are not correct.”

By 2010, March 2010, does what Mr Wilson says in that paragraph reflect the view that you would have held?

David Posnett: So he says it’s imperative that he’s kept informed. I agree, and that’s why I asked everyone to make sure that he’s kept in the loop because I noted he wasn’t copied in on some of the preceding emails.

Mr Beer: Well, let’s take it in stages after, then. The third line, he says his understanding is that the integrity of Horizon data is sound.

David Posnett: Yes.

Mr Beer: Did that represent your view by 2010?

David Posnett: Yes, so it’s another example, as I mentioned earlier, about messaging – we had Sue Lowther saying that the system is fine, here’s Rob Wilson saying his understanding is it’s fine, and the message from the top was similar. So …

Mr Beer: Who consisted of the top?

David Posnett: Well, I’ve heard things and seen things that about this Inquiry that allegedly people much higher up the chain knew things or were told there are problems or there might be problems. I don’t know the ins and outs or who those individuals are. I can’t remember any particular messages coming down but what I can recall is that there was certainly no messages coming up saying, “Stop investigating” or “Stop prosecuting”.

Mr Beer: So just breaking down what you said there, you can’t recall any messages coming from the top of the organisation at Executive Team level or similar, that filtered their way down to you that there was nothing wrong with Horizon?

David Posnett: I can’t recall specific messages, no, but that was my understanding and, likewise, we’ve got Rob Wilson here, his understanding is that it’s fine; sue Lowther, her understanding was that it’s fine. So, at my level and their level higher up, I think the impression was that we’ve been told that the system is fine or it’s working all the time correctly.

Mr Beer: Moving on:

“It is as a result of this that persistent challenges that have been made in court have always failed.”

Would that have been your understanding by 2010?

David Posnett: Yes, insofar as I don’t recall any challenges being successful. So, if that was the case, let’s say there’s been three, six, 12 or 20 challenges, and they’ve been unsuccessful, I think that would have, rightly or wrongly, cemented my view that the system was okay.

Mr Beer: Would it be your understanding that, in all of those cases where the challenges had failed, full disclosure had been given of any system problems with Horizon, ie so that there was a fair hearing that had resulted in a dismissal to the challenge to Horizon?

David Posnett: My view back then or now?

Mr Beer: Back then?

David Posnett: Back then, I would have thought everything was done as it should have been.

Mr Beer: Had you heard of a case concerning the Cleveleys sub post office involving Mrs Wolstenholme?

David Posnett: I’ve heard the name Cleveleys but I don’t think anything about it.

Mr Beer: Would you have known about it by then, by 2010, or is it something you’ve heard in the Inquiry?

David Posnett: I don’t know where I’ve heard of it but I’ve heard of the post office.

Mr Beer: Had you heard about subpostmasters being acquitted when they had raised a challenge to Horizon?

David Posnett: Not that I recall, but maybe in – well, no, I don’t recall.

Mr Beer: Your view, come 2010, would have been that the persistent challenges had always failed?

David Posnett: Yes, I can’t remember any challenges that were successful. There may have been some but I can’t remember.

Mr Beer: Mr Wilson says:

“These challenges are not new and have been with us since the inception of Horizon.”

Were you aware that the Post Office had received complaints concerning the integrity of Horizon data and challenges to Horizon data since the system’s very inception.

David Posnett: No. I don’t recall that and, as we’ve discussed, I was an Investigation Manager from 2000 to 2004. So I would only have had my cases, whereas the Legal Services team would have had oversight of all the cases across the country coming into them. So they may have been aware that there were issues at the beginning but I don’t recall that.

Mr Beer: During your tenure as the Investigation Manager, which included part of the national rollout period, what was the message coming down from above as to Horizon integrity?

David Posnett: Back then I don’t recall any mention of Horizon integrity. I think it was more in later years that it was mentioned.

Mr Beer: Were you, as an Investigation Manager, given training in relation to the way that Horizon operated and was relevant to your job as an Investigator?

David Posnett: I would say yes but I can’t remember any training that was given.

Mr Beer: I’m talking about bespoke training in relation to Horizon as an Investigator?

David Posnett: Again, I would say yes but I can’t remember the training.

Mr Beer: How did Investigation Managers understand the data, the varieties of data, that were available for them from Horizon?

David Posnett: I don’t know how they were made aware. All I can remember is transaction and event logs, and how to get them off the system.

Mr Beer: Were there written instructions issued to Investigators saying, “A key source of our evidence after, say, 2000, is going to be the Horizon system. It’s new, we haven’t got any policy or procedure that relates to getting evidence from this thing. This is a menu of the data that’s available. This is what it shows, or this is what it might show, such data. It might help you to prove A or disprove B. These are the people that you can get it from”?

David Posnett: I do recall something like that. But, again, I can’t remember it, but it was very more simplified. It was how to obtain a transaction log, do A, B, C; how to obtain an event log, do X, Y, Z, and so on. I think it was a one sheet of paper.

Mr Beer: Was that a within-your-team document or was it something that applicable country-wide?

David Posnett: I can’t remember and I don’t know whether it was drafted by someone in our team or one of the Crime Risk Team, or even borrowed from the Audit Team, I don’t know.

Mr Beer: When you were acting as an Investigation Manager, what determined whether you would investigate or not? What were the relevant considerations?

David Posnett: For an investigation?

Mr Beer: Yes.

David Posnett: Well, as an Investigation Manager, it would be whether my Investigation Team Manager had allocated a case to me.

Mr Beer: You tell us in your witness statement – there’s no need to turn it up, it’s paragraph 43 – in relation to deciding whether and in what circumstances to investigate:

“… the decision was informed by a number of factors, including the shortfall and the current resource and workloads within the teams.”

Is that correct?

David Posnett: Yeah.

Mr Beer: So, leaving aside for the moment, the amount of the alleged shortfall and focusing on the current workloads within the team, do you mean by that that the workload of the Criminal Investigation and Debt Recovery Teams played a part in deciding whether an alleged shortfall would be pursued as a crime or as a debt?

David Posnett: The Investigation Team, yes, we had nothing to do with the Debt Recovery Team. If I could just give you an example. Over the – I think when I started there was about 60 Investigators and something like nine or ten teams and, over the years, that went down to two or three teams and about 20 Investigators.

So, as the staff reduced, the workload didn’t reduce as much, probably like most businesses, and there came a time where, you know, Investigators were swamped with work. So –

Mr Beer: Did that affect the quality of the investigation that they were able to carry out?

David Posnett: It would have done if they’d retained that work. But I do remember we had to be quite hard and say “Right well, we’re not investigating this, that or the other”.

Mr Beer: What was the “this, that or the other” that you wouldn’t investigate?

David Posnett: Lower value audit shortages, pension allowance overclaims that were of a certain amount.

Mr Beer: On alleged shortfalls, what, if any, was the limit or the floor beneath which you wouldn’t go in an investigation?

David Posnett: I can’t remember a particular figure. But I do remember – I think I put it in my statement – about triggers and timescales.

Mr Beer: I’m sorry?

David Posnett: Triggers and timescales.

Mr Beer: Yes. Can you now remember what the triggers were?

David Posnett: I can’t remember now no but they fluctuated and, even when we were agreed on a trigger, if some has gone long-term sick and someone has left, then, again, that still wouldn’t be set in stone as for us to investigate.

Mr Beer: Notwithstanding the use of these triggers, did it nonetheless remain the case that teams had an overstretched capacity to investigate?

David Posnett: At times, yes. When I mentioned we had about 90/60 Investigators back then, I think, probably like other law enforcement agencies, we would investigate anything and everything that came our way. As time went on, staff became less, so you had to prioritise more what you actually investigated.

Mr Beer: Was there any drop in the extent and quality of the investigations that were conducted?

David Posnett: Not that I recall.

Mr Beer: So quality has always remained the same?

David Posnett: I believe so.

Mr Beer: It’s right, isn’t it, that you were set objectives to recover a certain amount, a certain percentage of fraud activity, weren’t you?

David Posnett: Yes.

Mr Beer: Can we look, please, at POL00126734. These are your objectives, your personal objectives, for the year April 2012 to March 2013. Was this a feature of all of your time as an Investigator and at this time in Fraud Recovery?

David Posnett: So every year we had objectives. I’m not sure when I was an Investigator we had a target for recoveries.

Mr Beer: At this time that we’re looking, April 2012, March 2013, you’re an Accredited Financial Investigator?

David Posnett: Yes.

Mr Beer: Are you saying that you don’t remember targets for recovery in the earlier period that I was looking at, 2000 to 2004, when you were an Investigation Managers?

David Posnett: That’s correct. I think the recovery was important, but I don’t remember it being an actual objective like it is here in later years.

Mr Beer: If we just scroll down and look at box 3, please. Under the heading “Fraud activity return on investment”, and “Fraud activity return on investment”, “investment” means investment in you, does it –

David Posnett: Yes.

Mr Beer: – ie the Post Office saying, “We’re employing you to investigate, as a Financial Investigator, losses and seek to recover them”?

David Posnett: Yes.

Mr Beer: “We are making an investment. We want to see what the return is on our investment in employing you”?

David Posnett: Yes.

Mr Beer: Is that what that heading means?

David Posnett: I think so.

Mr Beer: I think it says that:

“Evidence activity that produces recovery rates on inquiries closed of 65% or more (subject to quarterly review).”

Can you tell us what that figure means, 65 per cent or more, ie 65 per cent or more of what?

David Posnett: Right so 65 per cent or more on closed cases.

Mr Beer: But of what?

David Posnett: Well, if there’s been ten cases in the year and all of them were £10,000 losses, the total is £100,000 of loss, so the recovery target would be 65,000.

Mr Beer: Okay, so it means that you have got to produce evidence that shows that, of the total amount of shortfalls for that year, ie the alleged losses –

David Posnett: Yeah.

Mr Beer: – you have recovered 65 per cent of those?

David Posnett: Yes.

Mr Beer: It doesn’t mean in 65 per cent of cases and it doesn’t mean 65 per cent of cases there must be some recovery; it’s by reference to the total figure?

David Posnett: Yes.

Mr Beer: Can we see similarly for the next year POL00126836. These are your objectives for April 2013 to March 2014, “Fraud activity return on investment”:

“Evidence activity that produces recovery rates on closed enquiries of 65% or more.”

So the same?

David Posnett: Yeah.

Mr Beer: Do you know why one of your performance objectives was the recovery of such a number of the alleged shortfalls?

David Posnett: The particular number, I don’t know why it’s 65 per cent, but I can understand, if you’re an Accredited Financial Investigator, your job is to get money back for the business.

Mr Beer: Was that a consistent theme throughout your time as an Investigator and then as an AFI?

David Posnett: As an AFI, yes. As an Investigator, I can’t remember but, you know, there was a recovery element to the role.

Mr Beer: Can we look, please, at POL00126944.

Just pause there a moment. It looks like we may have lost the connection with the Chairman.

Sir Wyn Williams: Sorry, I was muted.

I was saying that there was a very small period of time, no more than seconds, where I think I lost connection but I’ve been following all that’s happened without a problem.

Mr Beer: Okay, sir, we can’t see you at the moment, for some reason, which it’s slightly discombobulating to hear a voice without a picture, because we don’t know whether you’re here or not.

Sir Wyn Williams: Well, I can assure when that I am here but, obviously, it’s necessary that I can be seen.

Mr Beer: Yes, you can now, sir.

Sir Wyn Williams: Fine.

Mr Beer: You’re back in the room.

Can we look, please, at this document which looks like the outcome of a performance review against the objectives that we’ve just looked at. It’s for the period April to October 2013; can you see that?

David Posnett: Yes.

Mr Beer: If we just scroll down on the one we’re looking at, the ROI, return on investment, it says:

“72% recovery rate against closed cases across the team.”

So you exceeded the 65 per cent target and then you set out the things that you did in order to do that, essentially, yes?

David Posnett: Yes.

Mr Beer: Did these recovery targets, getting in money, impinge on the way that you and your team went about its work in relation to subpostmasters?

David Posnett: Not that I remember, no.

Mr Beer: “We’ve got to get the money in, there’s an objective”?

David Posnett: Well, we’ve got to get the money in is the objective but, if there is no money – I wouldn’t say it’s the luck of the draw but in some cases there isn’t any money, in some cases there is.

Mr Beer: What were the consequences for you in missing targets?

David Posnett: The potential consequences were – I don’t want to go into too much detail but, on our PDRs you got a score of 5, which was excellent; 4 was very good; 3 was good; 2 was improvements required; and 1 was poor. So, if you didn’t hit the targets, it might have gone from good to improvement required.

So it affected your PDR score, which in turn would affect your bonus that you got as well.

Mr Beer: I was about to ask: was the achievement of the target in getting money in from subpostmasters linked to remuneration? The answer is yes.

David Posnett: It was linked to remuneration for me and others. But, as I say, let’s say that was 50 per cent, I could demonstrate well, you know, you couldn’t get money in these cases because there weren’t any, so I would have argued the toss if I hadn’t hit the required target.

Mr Beer: Were all Financial Investigators on a bonus scheme in the link to the recovery of money from subpostmasters?

David Posnett: Yes, and everyone within the Security Team was on a bonus, depending on their own objectives.

Mr Beer: What were the other bonus metrics for other members of the Security Team?

David Posnett: I don’t know. I mean, a Crime Risk Analyst, their day job is more analytics and –

Mr Beer: What about a straight Investigator?

David Posnett: The Investigator, as I say, I can’t recall. When I was an investigator, there was a specific target and I can’t – I mean, I can’t remember what, if any, target they had in later years.

Mr Beer: Here you are telling a manager, presumably, in this sentence, the second sentence:

“I have continued to secure impressive recoveries.”

Something in order to justify your bonus?

David Posnett: Indeed.

Mr Beer: At this time, and we’re here late 2013, had you any knowledge at all of any Horizon integrity issues?

David Posnett: Not specifically, just – well, if I could call it noise.

Mr Beer: So “noise”, in my mind, means something that’s going on in the background that’s a bit annoying and something you’d rather not pay attention to; is that how you’re referring to noise?

David Posnett: No.

Mr Beer: What do you mean by Horizon integrity issues were just noise?

David Posnett: What I mean is – I mean, I can’t be specific in terms of which years but there would be some noise, ie people citing Horizon. As the years went on, there may have been more offices or people citing Horizon. It’s a bit of like a snowball effect, it sort of gathers momentum, as the years go on.

Mr Beer: Is that how you viewed it, that it was just momentum gathering –

David Posnett: Um –

Mr Beer: – rather than potentially the true picture emerging, having been either not investigated or suppressed for a period of time?

David Posnett: Yeah, again, I’ll be honest, I viewed it as, as you’ve outlined at the time.

Mr Beer: So it’s something that was just gathering momentum because it was being mentioned in the press –

David Posnett: Yes.

Mr Beer: – and amongst the subpostmaster community?

David Posnett: Yes, and myself and, as we’ve mentioned, Rob Wilson, Sue Lowther and others, didn’t know or believe there was a problem, or issue –

Mr Beer: No, more than that. They’re saying that there isn’t.

David Posnett: Yes, indeed.

Mr Beer: Did you ever know what their view was based on?

David Posnett: No. But I presume it’s the same as mine: that the business were constantly saying “There’s nothing wrong with it, there’s nothing wrong with it”, which I always found a bit strange myself.

Mr Beer: Why did you find it strange?

David Posnett: Because my view is that every computer system has problems or glitches. So I think it was too strong to say “There is nothing wrong with it and it’s working at all times”. I mean, I’m sure we’ve all been in a supermarket, half price item, you get to the till and it comes up as full price. I’m sure we’ve all been on our PCs and some message comes up saying “You can’t access this, you haven’t got the rights”, yet I’ve not even wanted to access it. On a grander scale, you’ve got air traffic control across the world.

So every computer system, in my view, does have issues with it. So, I think, perhaps I was sort of quite strong there but that doesn’t mean that I thought there was anything systemically wrong with Horizon and that seems to have been backed up by witness statements obtained by Fujitsu.

Mr Beer: Presumably linking bonuses to the amount of money that you recovered from subpostmasters was intended to affect your behaviour?

David Posnett: Yes, but when you say that, it affected my behaviour, insofar as I would do what I could within the realms of the Proceeds of Crime Act.

Mr Beer: How did it affect your behaviour, knowing that you were on a bonus if you got more money in?

David Posnett: Well, even putting that aside, that was my job to get money back. And I utilised primarily confiscation orders, which was within the realms of the Proceeds of Crime Act and only following a conviction. So I utilised the powers in the appropriate way.

Mr Beer: That can come down. Thank you.

In your witness statement – no need to turn it up, it’s paragraphs 19 and 20 – you refer to your role in relation to case strategies.

David Posnett: Right.

Mr Beer: In paragraph 25, you refer to involvement in the development or management of policies. Who was responsible for criminal litigation strategy at the Post Office?

David Posnett: I think it was the Head of Security and the Senior Security Manager within that strand.

Mr Beer: Did you ever see criminal litigation strategy described?

David Posnett: I may have seen a policy, like a prosecution policy, if that was the same thing. I can remember it but I don’t know the details of it.

Mr Beer: Can you, in general terms, describe what the Post Office criminal litigation strategy was, say, between 2000 and 2004?

David Posnett: No.

Mr Beer: What about at a later stage when you were an AFI?

David Posnett: I don’t recall.

Mr Beer: How would you describe it now, looking back at it?

David Posnett: One element or one focus is to recover monies owed.

Mr Beer: Was that the principal purpose of the criminal litigation strategy?

David Posnett: I’m not sure it was the principal reason. Again, my recollection was that there was a policy to prosecute, if it was in the public interest and, you know, whatever rules or guidance that needed to be followed by primarily the Criminal Law Team. The recoveries were a significant part of that.

Mr Beer: Some organisations have or describe themselves as having a robust Criminal Investigation and Prosecution Policy. Some would say that they have a weak or a tolerant criminal investigation policy or strategy. Some might impose thresholds for investigation and prosecution that are exceedingly high, meaning that not much gets investigated or prosecuted.

Where, in the spectrum, did the Post Office sit, say, in 2000 to 2004, when you were an Investigation Manager?

David Posnett: I don’t know because I can’t compare to those. All I can say is recoveries were important and they grew more important as time went on.

Mr Beer: Was it explained to you why recovery of money was important, seen as important?

David Posnett: The only thing I can recall was that different parts of the Post Office generated profits for the business, whereas security investigations were more of a cost. So in order to redress that balance in some way, that’s why recoveries became more of a focus.

Mr Beer: So the recovery of debt, as you call it, from subpostmasters was seen as a way of contributing to the Post Office’s bottom line?

David Posnett: Yes.

Mr Beer: Thank you.

Sir, it’s 12.30. I wonder whether that would be an appropriate moment to break just for half an hour until 1.00.

Sir Wyn Williams: Yes, certainly.

Mr Beer: Thank you very much, sir.

(12.30 pm)

(A short break)

(1.00 pm)

Mr Beer: Good afternoon, sir, can you see and hear us.

Sir Wyn Williams: Yes, thank you.

Mr Beer: Thank you.

Good afternoon, Mr Posnett, can we turn to the issue of casework management and, in particular, the extent to which Post Office policies regulated the revelation of material that showed a procedural weakness in Post Office systems. Can we start by looking at POL00104777. If we look at the foot of the page, please, to get a date, October 2002. So this is whilst you would have been an Investigation Manager; do you see that?

David Posnett: Yes.

Mr Beer: If we go to the top of the document, please. It’s a Casework Management policy for England and Wales, part of “Investigation Policy”:

“The aim of [the]; policy is to ensure adequate controls are in place to maintain standards throughout investigation processes.”

Can we turn to page 2, please. Look at the last bullet point that we can see currently, the one beginning “The issue”. Thank you. The policy says:

“The issue of dealing with information concerning procedural failures is a difficult one. Some major procedural weaknesses, if they became public knowledge, may have an adverse affect on our business. They may assist others to commit offences against our business, undermine a prosecution case, bring our business into disrepute or harm relations with major customers. Unless the offender states that he is aware that accounting weaknesses exist and that he took advantage of them, it is important not to volunteer that option to the offender during interview. The usual duties of disclosure under the Criminal Procedure and Investigations Act 1996 still apply.”

Is the approach that is set out there one that you used when you were an Investigator?

David Posnett: I believe so, yes.

Mr Beer: You’ll see it refers to “major procedural weaknesses, may … undermine a prosecution case”, if they became public knowledge –

David Posnett: Yes.

Mr Beer: – and that unless the offender states they’re aware and took advantage of them, don’t volunteer them in interview. Is that the approach that you took?

David Posnett: I don’t recall that’s the approach I took but, if this was the policy at the time I was an Investigator, I would have thought, by and large, I would have adhered to that policy.

Mr Beer: Do you know why it was the Post Office’s policy not to reveal major procedural weaknesses to people accused of crime?

David Posnett: Because, if word got out, others could commit the same crime with those weaknesses still in place.

Mr Beer: What about if the weaknesses were not about security or locks and barriers and screens and cash in transit and safes, and things like that, physical security issues, what about if they were weaknesses in the accounting integrity of the Horizon system?

David Posnett: I can recall that, on the discipline reports, I would sometimes note weaknesses. In terms of the Horizon accounting, I don’t recall any of my cases having that.

Mr Beer: So that issue didn’t arise for you because you believe there were no weaknesses in Horizon?

David Posnett: That’s what I believe but I don’t recollect any of my cases where Horizon was cited anyway.

Mr Beer: Can we look, please, to the distinction between the discipline report and the offender report, by looking at a different policy, POL00118101. You’ll see this a guidance document or a guide to the preparation of Red Label Case Files. Can you just help us with what’s a Red Label Case was?

David Posnett: If a case was going to go up for legal advice, there was a Red Label we used to put on the case file that said, “Urgent today, must be prioritised during the course of transit”.

Mr Beer: So it was a signal that it was going for legal advice?

David Posnett: Yes.

Mr Beer: Thank you. Can we took, please, at page 10, please, at the foot of the page. Can you see paragraph 2.15, “Details of failures in security supervision, procedures and product integrity”:

“This must be a comprehensive list of all failures in security, supervision, procedures and product integrity [and] it must be highlighted in bold in the report. Where the investigator concludes that there are no failures a statement to this effect should be made and highlighted in bold.”

Then over the page:

“Significant failures that may affect the successful likelihood of any criminal action and/or cause significant damage to the business must be confined, solely, to the confidential offender report. Care must be exercised when including failures within the Discipline Report as obviously this is disclosed to the suspect offender and may have ramifications on both the criminal elements of the enquiry, as well as being potentially damaging to the reputation or security of the business. If you are in any doubt as to the appropriateness of inclusion or exclusion you must discuss with your team leader.”

Do you understand the distinction that’s being drawn there between a discipline report and the offender report?

David Posnett: Yes.

Mr Beer: Do you understand that any failures that might affect the likelihood of successful criminal proceedings were not to be included in the report disclosed to the offender?

David Posnett: Yes.

Mr Beer: Why was that?

David Posnett: I don’t know but with – this particular document doesn’t relate to when I was an Investigation Manager. I think the previous document you showed, POL00104777, was applicable during the time frame that I was an Investigator and, on that policy, I believe it says something like weaknesses to be put on the report that goes to Legal Services.

Mr Beer: That’s the same as this: include weaknesses in the confidential report –

David Posnett: Yes.

Mr Beer: – that goes to Legal Services; don’t include them in the one that goes to the suspect?

David Posnett: Yes, but on the one that would be more applicable to me when I was an Investigator, I’m sure it says in there somewhere the failings, it would be up to Legal Services to decide whether that should be disclosed.

Mr Beer: So do you know why, if a list or a narrative description of failures that might affect the successful likelihood of criminal action against a suspect, were not to be disclosed to them in a report which they would receive?

David Posnett: No, other than, as we’ve mentioned, if it’s a weakness in Post Office procedures or policies and word got out, it could mean other people could commit the same act. That’s what I understood that to be. I didn’t understand it to be “We need to keep this quiet because” – you know, in terms of disclosure.

Mr Beer: Who was responsible for deciding what should be disclosed and what should not be disclosed in criminal proceedings?

David Posnett: Again, when I was an Investigation Manager, there was a Royal Mail Group Policy and Standards Team and all these things came out from them. As the years went by, Post Office became more independent and we had our own people drafting policies or reissuing policies.

Mr Beer: Who, when you were an Investigation Manager between 2000 and 2004, in an investigation, was responsible for deciding what fell to be disclosed to a defendant?

David Posnett: The Criminal Law Team.

Mr Beer: Did the Investigator have any role?

David Posnett: Yes, the Investigator would record all the information on the relevant schedules, unused material. Then it went to the Criminal Law Team and it was up to them to say yea or nay, or this should be on that form rather than that form. So, ultimately, they were responsible for disclosing to the defence that the Investigator recorded all the items that they had.

Mr Beer: So it was a joint venture in which the Investigator was responsible for gathering the material together and scheduling it?

David Posnett: Yes. The Investigator had to do their part and then, ultimately, it was the Criminal Law Team who decided what was –

Mr Beer: Who decided on which schedule a document should appear or whether it should not appear on a schedule at all, and were responsible for giving physical disclosure of that to the defence; is that right?

David Posnett: Pretty much, yeah. I mean, for example, I can remember one criticism I received. I can’t remember the name of the lawyer but they – I remember them phoning me up, because I used to include post notes and bits of paper and all sorts on my unused material, and they said to me “Dave, it’s only relevant material you need to disclose”, and my view was “Well, who is to determine what’s relevant and what’s not?”

So if the only criticism for me was to disclose too much, then I was happy to take that criticism. But that’s what I mean about I would submit the forms and then Criminal Law Team would decide what gets disclosed.

Mr Beer: Getting back to the report issue, do you understand why it was that significant failures that might cause damage to the business should not be included in a report that was disclosed to the offender?

David Posnett: No, other than what I’ve said.

Mr Beer: Can we move on to POL00031005. This is a Conduct of Criminal Investigations Policy and we can see that it came into force in August 2013. Was there a policy like this beforehand, that you’re aware of? Maybe you want to just flip through some of the pages to see what it looks like, its topics. If we scroll to – that’s it, the table of contents.

David Posnett: I think there possibly was but I don’t recall.

Mr Beer: Okay. Can we look, please, at page 16, right at the bottom, please, paragraph 5.11.6. This is dealing with interviews. The policy tells Investigators:

“Should the recent Second Sight review be brought up by a suspect or his representative during a PACE interview the Security Manager should state: ‘I will listen to any personal concerns or issues that you may have had with the Horizon system during the course of this interview’.”

Was that a policy that you’re aware was followed, that a pre-prepared script, in accordance with that sentence there, was read out to suspects?

David Posnett: I wouldn’t be aware as to whether that occurred in every case of relevance. What date was this document?

Mr Beer: August 2013.

David Posnett: Right. So I think this may have been on the advice of Cartwright King, perhaps.

Mr Beer: You picked up the role of an Investigation Team Leader in 2014 and in 2015, where I think this policy will still have been extant, and, plainly, the Second Sight review was something that suspects may raise. Would you agree?

David Posnett: Yes.

Mr Beer: Was voluntary disclosure given to a suspect of the Second Sight Report?

David Posnett: I don’t know.

Mr Beer: Was there any sense in which the Post Office were seeking to shut down a suspect in interview by reading a pre-prepared line like this back to a suspect who raised the Second Sight Report?

David Posnett: I don’t know but, on reading that again, I don’t think so because, if a suspect raises Second Sight, this is saying that I will listen to any personal concerns or issues that you may have had. It doesn’t sound to me like it’s shutting it down.

Mr Beer: Okay, thank you. Can I move to the extent to which you understood the Horizon system could be afflicted by system integrity issues. You tell us in your witness statement that, when you were the Casework Manager at Croydon – so I think we’re talking between 2008 and 2010; is that right?

David Posnett: I thought Casework Manager was 2007 and 2008 but, yeah.

Mr Beer: So I think 2004 to 2007, Investigation Team Manager; 2008 to 2010, Fraud Risk Manager, quite right.

David Posnett: Yes.

Mr Beer: In what job was one of your responsibilities – I’ll ask it the other way round – the obtaining of ARQ data?

David Posnett: So that was – Post Office Investigators would email in to the Casework Team a request for primarily transaction and event logs. Myself or one of the team would complete an ARQ form and send that to Fujitsu.

Mr Beer: So this is when you were working as a Casework Manager at Croydon –

David Posnett: Yes.

Mr Beer: – you had that responsibility for a couple of years?

David Posnett: My recollection – and bear in mind I seem to have got the date wrong on my testing analyst thing – I thought I was a Casework Manager between ‘07 and ‘08, a number of months, so I’d say it was a few months between ‘07 and ‘08.

Mr Beer: So you held a responsibility for a period of time as a Casework Manager for obtaining ARQ data from Fujitsu?

David Posnett: Yes.

Mr Beer: What training did you have to assist you to understand the nature of ARQ data before you took up that role?

David Posnett: I don’t recall any training in respect of that.

Mr Beer: Did you have any training about the nature and extent of the data held by Fujitsu, which could potentially assist the Post Office in its investigations and prosecutions, before you took up the role?

David Posnett: I don’t recall.

Mr Beer: When you carried out this work as the person responsible for obtaining the ARQ data from Fujitsu, did you understand the difference between what might be called standard ARQ data and enhanced ARQ data, the latter of which included data that could show where an action in the system had been generated by the system, rather than being generated at the counter?

David Posnett: Not that I recall, no.

Mr Beer: So you didn’t know there was a difference between two species of ARQ data?

David Posnett: I don’t think so, I don’t recall. What I do recall is whatever the Investigator wanted via the email they sent was what I would put in the ARQ request.

Mr Beer: Did you get a handover from the person who was doing the job before you?

David Posnett: Yes.

Mr Beer: Did they explain to you that, “Look, there are different levels of ARQ data available”?

David Posnett: Not that I recall.

Mr Beer: You were the main point of contact between the two organisations, is this right, in relation to obtaining ARQ data?

David Posnett: Anyone in the Casework Team could act in getting the data but I was the liaison point liaison in terms of the relationship between Post Office and Fujitsu.

Mr Beer: So you knew how the system worked for getting data from Fujitsu?

David Posnett: Yes.

Mr Beer: You knew the forms that needed to be filled in, in order to get that data from Fujitsu?

David Posnett: Yes.

Mr Beer: Was the Post Office ever reluctant to request ARQ data from Fujitsu because it would incur cost?

David Posnett: Yes.

Mr Beer: Did you ever feel that commercial considerations overshadowed the desire to investigate shortfalls thoroughly and consistently?

David Posnett: I don’t recall making that link.

Mr Beer: Was there a difference, from case to case, as to the extent of the ARQ data obtained?

David Posnett: The extent, as in what –

Mr Beer: The time period covered.

David Posnett: Yes.

Mr Beer: Was that sometimes based on cost?

David Posnett: I would say yes.

Mr Beer: We’re going to get into the detail on this in a minute but can you give us your overall impression of how significant an issue this was?

David Posnett: From recollection, I don’t think it was a significant issue; I think there were a couple of occasions where the volume of information being requested seemed excessive. So, if the quota or, you know, the volume of requests per month was eaten into to an extent, it could have affected Investigators’ requests, so that was a sort of juggling act.

Mr Beer: Was some data not sought because of cost?

David Posnett: In part, I would say, yes.

Mr Beer: Can we just turn to – a bit before we get into the detail of ARQ data – a view expressed on Post Office’s duties to verify through evidence the existence of a shortfall. Can we look at POL00140164. This is an exchange of emails concerned the Glenmoriston branch from November 2014 and, if we can go to page 3, please – and scroll down, please, and keep scrolling.

It’s an email exchange between you and Angela van den Bogerd and I needn’t, I think, introduce the context for it but she says:

“Dave,

“Thanks for letting me have sight of this. I’d be interested to see the response we have sent to the letter as we need to ensure we are replying in a reasonable yet robust way.”

Then this:

“The verification of stock and cash should be evidence enough that there is a shortfall and if we have evidence of falsification of accounts this will add further weight. We should be drawing our legal colleagues also [I think it should be ‘drawing on our legal colleagues also’] as it is not for [the Post Office Limited] to demonstrate where the shortfalls have occurred just that they have.”

So this is a discussion about what evidence is needed to prove a shortfall. Can you see that Ms van den Bogerd says:

“The verification of stock and cash should be evidence enough that there is a shortfall …”

Was that a commonly held view?

David Posnett: I don’t recall.

Mr Beer: Is it a view that you would subscribe to, as an Investigator?

David Posnett: As an Investigator:

“The verification of stock and cash should be evidence enough that there is a shortfall …”

Mr Beer: Essentially she’s saying, if, at audit, a shortfall is shown between what the system says should be there in terms of stock and cash and what is there in stock and cash, that’s as far as the Post Office needs to go?

David Posnett: Yes, that would have been evidence of a shortfall.

Mr Beer: Would it be sufficient evidence of a shortfall in the context of criminal proceedings?

David Posnett: I don’t know. There would be other parts or information relating to the case but then, ultimately, it’s a decision for people higher up.

Mr Beer: I don’t think you’re answering my question at the moment. Would it be your view that, in order to prove a loss in a shortfall case against a subpostmaster, it’s sufficient just to show at audit there was a difference between what the system showed ought to be there in terms of cash and stock and what was there in cash and stock?

David Posnett: I think when I was an Investigator, that was pretty much it.

Mr Beer: Would that apply to the period of 2000 to 2004 and when you came back to investigations later in your career?

David Posnett: I didn’t come back to being an Investigator. I don’t think that changed. If a cash amount has been declared, which is different to the system, that was a big part. But it’s possible that an error notice could come back to explain the loss.

Mr Beer: This is saying how far the Post Office needs to go or doesn’t need to going proving its case: “All we need to show is the difference”, as I’ve said, “between what the system shows and what’s there on the ground, as displayed at audit”; was that a view, essentially, that was held commonly?

David Posnett: I would think so but I can’t recall.

Mr Beer: Was it a view that you held: “I can prove a case, I can put a case before the criminal court, fit for the criminal courts to consider, of a subpostmaster stealing money if there’s a difference between what the system says should be in his cash and stock and what’s in his cash and stock”?

David Posnett: When I was an Investigation Manager, yes, but there would be other things, as well, to consider.

Mr Beer: Were the other things, as well, to consider necessary things to consider?

David Posnett: Yes.

Mr Beer: What were the other things that were necessary to prove a case?

David Posnett: The points to prove on a particular offence.

Mr Beer: What would be the points to prove on a theft case?

David Posnett: A theft case would have been the dishonest appropriation of property belonging to another with the intention to permanently deprive.

Mr Beer: So that’s the definition of theft?

David Posnett: Yes.

Mr Beer: How would that be translated into a subpostmaster shortfall case? What evidence would you need in order to prove those, depending how you cut them, four or five elements to of the offence of theft?

David Posnett: His responses or answers to relevant questions put to him or her during interview.

Mr Beer: Ie it would be necessary to have an admission from him?

David Posnett: It would be necessary to tick off those points to prove, yes.

Mr Beer: I don’t understand what you mean, I’m afraid, Mr Posnett. This email tends to suggest that “We think we can get a case home to port by showing a shortfall at audit”.

David Posnett: Yes.

Mr Beer: I’m asking: is that your view?

David Posnett: I think that would have been my view at the time I was an Investigator –

Mr Beer: The other stuff is just trimmings; is that right?

David Posnett: Well, I would say they were important but – not just trimmings, but, yes, I think when I was an Investigation Manager, if the cash and stock physically there was different to what had been declared, that would have gone a long way to –

Mr Beer: Proving a case of theft?

David Posnett: Yes, but that wouldn’t be us; that would be up to the people above. And, also, it’s if the Auditors had contacted various people to get the Investigation Team involved. So it’s not just there’s a shortage, we’re there, it has to go through certain channels.

Mr Beer: That’s the people who need to look at it and investigate it from a matter of process?

David Posnett: Yes.

Mr Beer: I’m asking, from an evidential point of view, and I think we’ve reached the position that you say that it was your view when you were an Investigator that shortfall at audit was a sufficient basis to make an allegation of crime and the crime being of theft?

David Posnett: Yes.

Mr Beer: Would you subscribe to the other parts of Ms van den Bogerd’s email, that, if there is any evidence of falsification of accounts, that’s just additional weight, that’s just what I’ve called trimmings?

David Posnett: Yes.

Mr Beer: That’s something nice to have but not necessary to have?

David Posnett: Yes.

Mr Beer: Would you subscribe to the other part of her email at the end there: it’s not necessary for the Post Office to demonstrate where the shortfalls have occurred – ie to prove on which day, through which transaction or by which means the shortfalls have occurred – just that there is a shortfall?

David Posnett: I would disagree with that now.

Mr Beer: Why would you disagree with that now?

David Posnett: Because of what we know now.

Mr Beer: You wouldn’t have disagreed with at the time, I take it?

David Posnett: I don’t know.

Mr Beer: So we, Post Office, don’t have to show, by reference to records, that the subpostmaster took the money out of the account by overstating the amount of stamps sold or undervaluing the amount of cash received?

David Posnett: Yeah.

Mr Beer: All we have to do is show that, at cashing up, at the audit, at the stocktake, there’s a difference between what Horizon shows should be held and what is, in fact, held?

David Posnett: Yeah, I would say that’s wrong.

Mr Beer: You would say that’s wrong now.

David Posnett: Well, it was wrong at the time as well.

Mr Beer: Why was it wrong at the time?

David Posnett: Because it says it’s not for POL to demonstrate where the shortfalls have occurred, just that they have.

Mr Beer: Just that they have.

David Posnett: So there could be a genuine error that could be explained by an error notice that comes back. Yeah.

Mr Beer: So how was it to be investigated how the shortfalls have occurred? If it was wrong at the time, what Ms van den Bogerd wrote, and presumably wrong in 2000 and 2004 too, how did the Post Office go about demonstrating where the shortfall occurred?

David Posnett: Via interview.

Mr Beer: That’s asking the subpostmaster?

David Posnett: Yeah.

Mr Beer: What about by reference to any other evidential source?

David Posnett: Like Horizon?

Mr Beer: Yes. Was that done?

David Posnett: I don’t recall it being done in my cases but I am aware that Investigators did obtain transaction event logs.

Mr Beer: Is that where the suspect raised an issue as to Horizon integrity?

David Posnett: I believe so.

Mr Beer: Was that seen as the touch point for whether Horizon needed to be investigated or interrogated or not, depending on whether the suspect raised an issue of Horizon integrity?

David Posnett: I think transaction event logs were obtained by Investigators (1) to counter what may be claimed by a subpostmaster or counter clerk or (2) to back up the Investigator’s view as to what’s happened.

Mr Beer: Do you remember that the standard request for ARQ data included, amongst the additional requirements that could be made, could be ticked, “confirmation that there are no reported system matter of law functions during the date range period”?

David Posnett: I don’t recall that.

Mr Beer: Can we look, please, at POL00051793. This is an ARQ request in Seema Misra’s case, completed by you. Can you see that?

David Posnett: I can, yes.

Mr Beer: It’s dated 9 June 2009 and is this in fairly standard format?

David Posnett: I don’t recall but yes.

Mr Beer: You can see that it asks the question whether a witness statement is required, yes or no. What would determine whether a witness statement was required?

David Posnett: If the Investigator has asked.

Mr Beer: Yes, that’s a bit circular. But why would an Investigator ask for a witness statement and why might an Investigator not ask for a witness statement when asking for ARQ data?

David Posnett: I don’t know. I mean, at this stage, if they’re requesting data during an investigation, they wouldn’t know at that stage whether a witness statement would be required, so I don’t know –

Mr Beer: Why might it be required in some cases and not in others?

David Posnett: It may be required if a person was going to plead not guilty or to cover off any challenges that a person may make.

Mr Beer: Does the opposite of that apply, that it wasn’t required if it was thought the person was going to plead guilty?

David Posnett: I don’t recall but, yes, it could.

Mr Beer: Why might that be? Why might a witness statement not be required if it was believed that the person might plead guilty?

David Posnett: Well, I think if someone is going to plead guilty, then it would be a bit of a waste of time doing a witness statement because it won’t be required.

Mr Beer: What about giving them all of the evidence so they can judge whether to plead guilty or not?

David Posnett: It would be relevant in that situation.

Mr Beer: In any event, the form continues “Standard Format Requirements”. Can you help us as to what that meant? Were they pre-printed, those standard format requirements?

David Posnett: I don’t recall but I would say yes.

Mr Beer: It asks for:

“A report of all transactions and events (including inactivity logout, log on/log off information) for the office including remittances received, transfers between stock units and error notices. Information to be provided in Excel 97 format with each category in a separate column.”

Then “Column headers as follows”, then scroll down, please.

Then “Additional Requirements”, and you would mark this up “Yes” or “No”?

David Posnett: I would say yes.

Mr Beer: Yes, ie you would mark it up “Yes” or “No”?

David Posnett: I think so, yes.

Mr Beer: What would determine what information you asked for or didn’t ask for?

David Posnett: What the Investigation Manager is requesting on the email.

Mr Beer: So there wasn’t a form for the Investigator to fill in like this, was there?

David Posnett: I don’t believe so, no –

Mr Beer: How – sorry, I interrupted you.

David Posnett: I don’t think so because Fujitsu would only deal with the Casework Team. They shouldn’t really have dealt directly with the Investigator.

Mr Beer: So how would you decide what information to seek and not to seek?

David Posnett: Purely based on what the Investigator is requesting.

Mr Beer: In the second box down here, the words:

“Please could you obtain a standard statement from Fujitsu that confirms the Horizon system for the above [Post Office] was functioning properly between 30 June 2005 [and] 14 January 2008. The statement should state that they have reviewed and summarised all call logs during this period; however, these do not need to be produced.”

Just breaking that down, why was it necessary to obtain a statement that said the Horizon system was functioning properly?

David Posnett: I don’t know.

Mr Beer: To what extent were the call logs seen as a measure of whether Horizon was functioning properly at a branch?

David Posnett: I suppose the call logs may identify if a subpostmaster or clerk believed that the system wasn’t functioning properly.

Mr Beer: Did you understand whether any additional work was carried out by Fujitsu in the provision of a witness statement, which addressed anything other than the call logs?

David Posnett: Not that I recall.

Mr Beer: So you understood that the Fujitsu statement was based on and only based on an analysis of the call logs?

David Posnett: Well, I don’t know what they – I mean, the bit here that the – if the system was functioning properly, I don’t know, only Fujitsu can answer that, but I don’t think you should just look at the call logs to determine whether the system was working correctly.

Mr Beer: Why should you not just look at the call logs to determine whether the system was working properly?

David Posnett: Because the call logs can’t definitively tell you whether the system was working correctly.

Mr Beer: But, as a matter of fact, you don’t know whether they looked beyond the call logs in the provision of this standard statement that says that it was functioning properly?

David Posnett: Correct. I mean, I assume that they did look at the system because that was the key part of their witness statements, to confirm or not, although confirm mainly, that the system was working correctly.

Mr Beer: The request says that the call logs do not need to be produced. Why did the call logs not need to be produced?

David Posnett: I’m assuming that this is what the Investigator has requested.

Mr Beer: Well, I think we may see that this is a standard form of request that’s marked “Yes” or “No”, and that the date range is altered depending on a range of factors?

David Posnett: Yeah, I – I mean, this part and the top part of the form, I mean, there’s no way on earth I can imagine I’ve completed all these questions, so I think you’re right, although I can’t recall, that there’s text already in these boxes and they may need to be tweaked to reflect a particular office or a particular time frame.

Mr Beer: Why did you understand that it wasn’t necessary for Fujitsu to produce to Post Office, the prosecutor, the call logs?

David Posnett: I don’t know.

Mr Beer: They might contain weekly or monthly or sometimes, as we’ve seen, even daily complaints by a subpostmaster?

David Posnett: Yes.

Mr Beer: Aren’t they relevant information?

David Posnett: Yes, I guess so.

Mr Beer: So I just ask again: do you know why the Post Office was asking or saying that they needn’t be produced?

David Posnett: I don’t know why.

Mr Beer: Can we look, please, at FUJ00155830. You can see that the form appears to have changed a little bit in terms of the way it’s printed but it contains the same sort of information?

David Posnett: Yeah.

Mr Beer: If we can just scroll down, please, and again. Yes, you can see that this is a form, version 4, dated November 2007, right at the foot of the page?

David Posnett: Yes.

Mr Beer: If we scroll back up, please. The year is not completed. You see that it was completed by you on 2 July?

David Posnett: Yes.

Mr Beer: This is for the Cowleymoor branch with some date ranges between July ‘05 and January ‘06. You’ll see the standard format hasn’t changed; can you see that?

David Posnett: Yes.

Mr Beer: Then if we scroll down, you’ll see that the previous standard wording has been removed and it seems to have been replaced by analysis of Horizon Helpdesk call logs. Can you see that in the second box down?

David Posnett: I can, yes.

Mr Beer: Do you know why that was?

David Posnett: I don’t know why it’s changed. I don’t recall the form actually changing either, but yes.

Mr Beer: Who was responsible for the design of these forms, ie the information that Post Office, as a prosecutor, was seeking from Fujitsu, as a third party provider of material?

David Posnett: I assume that the Casework Team back in 2000, or even before that, drafted these forms and policies ready for when Horizon came in.

Mr Beer: You would agree that the standard wording on the ARQ form that we saw before this one supports an understanding that any large computer system could suffer system malfunctions and, therefore, checks needed to be made to exclude at least those that had been reported?

David Posnett: Yes.

Mr Beer: Here, the position is changed. It’s just asked for an analysis of the call logs. Again, do you know why that change was made –

David Posnett: I don’t know.

Mr Beer: – rather than asking for a positive statement, confirmation that there are no reported system malfunctions –

David Posnett: I don’t –

Mr Beer: – that Horizon was working properly to an analysis of the call logs?

David Posnett: I don’t know the reason why it’s changed.

Mr Beer: In any event, you didn’t ask for that in this case; you’ve marked it up as “No”?

David Posnett: Correct.

Mr Beer: Why wouldn’t you want to know in a particular case whether a subpostmaster had made calls to the Horizon Helpdesk about Horizon?

David Posnett: Again, it’s what the Investigator is requesting.

Mr Beer: Why might an Investigator not want to know that his suspect or her suspect has made calls to the Horizon Helpdesk?

David Posnett: I don’t know.

Mr Beer: What did you understand the purpose of all of this was, seeking this data, as the person responsible for seeking it?

David Posnett: So the purpose was for the Investigation Manager to advance the investigation. That’s what this was designed for in the beginning.

Mr Beer: But can you maybe look at it a bit deeper than that? What was the purpose of seeking this data from Fujitsu?

David Posnett: To back up what was happening in branch, to assist the case.

Mr Beer: Again, did you have any deeper understanding than that or were you just sort of filling out forms?

David Posnett: Well, at this stage, filling out forms. We were just the interface between the Investigator and Fujitsu. So the email came in, we’d complete this form or the other version and off it goes to Fujitsu.

I mean, if I go back to when I was an Investigation Manager, the only time I can recall obtaining logs was to demonstrate that certain transactions had gone through the system when they shouldn’t have, things like that. I don’t actually remember any audit shortages where I would have obtained logs.

Mr Beer: If we go back to POL00051793 and look at that box a bit further down, please:

“Please could you obtain a standard statement which confirms the Horizon system for the above post office was functioning properly.”

Can you see that?

David Posnett: I can, yes.

Mr Beer: Did you not think that in each and every case it was a necessary element of a prosecution to prove that?

David Posnett: Back then, no.

Mr Beer: Why not?

David Posnett: Because if Horizon hadn’t been mentioned, or there were no concerns by other either party about Horizon, it, in my mind, I think, would have been superfluous to the nitty-gritty of the case.

Mr Beer: So you didn’t consider it a necessary element of the investigation, everything else being equal, to prove that the system that produced the data that you relied on was functioning properly?

David Posnett: That was the assumption, in much the same way that, prior to Horizon, you had ECCO in Crown Offices, Capture or Jackson I think, in sub post office but I don’t think we got any, as a matter of course relevant logs from those systems.

Mr Beer: Was there any policy or guidance on this? You’re a criminal investigator, you’re seeking to prove a loss by computer-produced evidence. You either do or don’t need to produce some evidence of system reliability and the reason that you do need to produce evidence of system reliability is as follows, and the reason you don’t need to prove system reliability is as follows.

David Posnett: I don’t recall a policy outlining that.

Mr Beer: Again, we can see, although the forms are differently worded, in one case some such data was to be sought and in another it was not.

David Posnett: Yeah.

Mr Beer: What accounted for the difference of approach? Why might it be needed in some cases and not others?

David Posnett: I mean, it partly depends on the case. I notice one of the things there is barcode and car licence details. So primarily that would be nothing required but, if the case did relate to –

Mr Beer: I’m thinking more about the system integrity box.

David Posnett: Oh, system integrity. I don’t know, it’s whatever the Investigator indicated.

Mr Beer: Yes, that can come down. Thank you.

In paragraph 58 of your statement you say that the Post Office was required to pay Fujitsu for ARQ data over a certain amount of annual requests.

David Posnett: Yes.

Mr Beer: I think you say that the figure was around 720 requests in 2006?

David Posnett: Yes.

Mr Beer: Can we look, please, at FUJ00002033. Can we look at page 16, please.

I’ve done that far too quickly. I should show you the front page first.

This is a Fujitsu document dated 28 August 2006, headed “Security Management Service: Service Description”. Can we just please look at page 16. If we scroll down, please, to 2.4, it says this table, Table 2, defines the limits on new and old data requests.

If we look at the box on the far right, the limit per year shall be the first of the following to be reached, 720 ARQs, yes –

David Posnett: Yes.

Mr Beer: – or 15,000 query days. Do you know what the query days related to, do you remember? There is, in fact, a definition in here but do you remember?

David Posnett: I don’t remember.

Mr Beer: Can we look, please, at FUJ00080107, and if we just scroll down, please, for the date, 2008, bottom right, December 2008. Scroll up to the top, please. Same title “Security Management Service: Service Description”, and go to page 17, please.

Similarly, in the box on the right-hand side, 720 ARQs or 15,000 query days.

David Posnett: Yes.

Mr Beer: What happened when that limit was reached?

David Posnett: I think, if that limit was reached, we would then have to have paid extra. So we paid for these services as part of the contract. If we went over those, I think we got charged extra.

Mr Beer: What was the amount that you were charged? Can you remember?

David Posnett: I can’t remember.

Mr Beer: Was it seen as a sum of a level that it acted as a disincentive to seek ARQ data beyond the limits?

David Posnett: I don’t remember but, yes, possibly.

Mr Beer: We’ve heard evidence in the Inquiry, it was on 19 October this year, from Alison Bolsover who was a Debt Recovery Manager; do you remember her?

David Posnett: I do, yes.

Mr Beer: She said that it would have been worthwhile for the Post Office to obtain ARQ data before commencing action against subpostmasters, ie before suspension or termination, and certainly before the initiation of any criminal proceedings but that the quotes that were being given by Fujitsu for doing that were astronomical. Do you remember that?

David Posnett: Yes.

Mr Beer: Was cost essentially the reason that this data was not sought as a matter of course, before suspension and termination?

David Posnett: Cost was one of the factors.

Mr Beer: What were the others factors?

David Posnett: The other factors were whether we reached the limit of requests, which would adversely impact on investigations. So, for example, in previous years, I think it was something like 350 a year or 30-something requests a month, and I can remember Investigators sending in requests and say it was, I don’t know, 20 October, we’d already reached the maximum, so we used to ask the Investigator “Can you wait ten days and submit it on 1 November?” That way we could not exceed our monthly requests. That was alleviated more when it increased to 720 but, yes, the costs were a part of that as well.

Mr Beer: At the time, did it feel like cost for the provision of ARQ data was a significant issue for the Post Office?

David Posnett: I would say yes, on the basis that costs and money spent throughout the Post Office was not frowned upon but they want to, you know, keep a tight rein on every penny spent.

Mr Beer: The judge that heard the Group Litigation in 2019 found that audit data should have been sought in every case where a subpostmaster was possibly going to be suspended or have their contract terminated, that the Post Office acted unreasonably in failing to seek such data before those events occurred, and that the commercial arrangements between the Post Office and Fujitsu did not justify the failure to seek the audit data, which was the best evidence of what had occurred and whether any bugs, errors or defects were operative.

Was that something that you were aware of, obviously not the judge’s view, but the essence of what he was to find when you were carrying out this work?

David Posnett: No.

Mr Beer: Putting it another way, was there an awareness by you and within your team that postmasters were being suspended and their contracts terminated without the full suite of data being obtained first and that that was potentially unfair?

David Posnett: I wasn’t aware of that because I don’t know what Investigators would have requested Horizon data and when. I believe it wasn’t every single case, so what you’ve said makes sense.

Mr Beer: You must have been aware of what Horizon data Investigators sought and didn’t seek because you were the gateway through which it had to pass?

David Posnett: The Casework Team were but we never sort of said “Right, there’s been 100 cases this year or we’ve had 100 ARQ requests, so that marries up”, you know. We didn’t reconcile cases against data requests like that.

Mr Beer: Was there a view ever expressed within your team or a view that you heard that the Post Office regarded Fujitsu as an organisation which saw the Post Office as a cash cow?

David Posnett: I don’t recall that but, personally, I thought Fujitsu were doing quite well out of the relationship.

Mr Beer: Specifically in relation to ARQ data?

David Posnett: Partly in relation to ARQ data. I mean, I always found it a bit strange that we – if it came to the crunch, we had to pay a lot of money for, in effect, our own data. But that’s contracts for you. But, also, I seem to remember I think Fujitsu – I might be wrong – got a penny for every transaction across the Post Office Network, which is worth a lot of money.

Mr Beer: Can we turn, please, to FUJ00152212. You can see that this is a document, if we scroll to the foot, please, dated 2009. If we go to the top, please, “Management of the Litigation Support Service”. Were you aware of something within Fujitsu called the Litigation Support Service?

David Posnett: No, I didn’t – I didn’t view it as a group of people, but just as the – what they would provide us from a litigation perspective.

Mr Beer: If you had to name people that provided litigation support to the Post Office within Fujitsu, who would you have named?

David Posnett: Penny Thomas, Peter Sewell, Gareth Jenkins and Andy Dunks.

Mr Beer: Anyone else?

David Posnett: Not that I can recall, no.

Mr Beer: Can we go to paragraph 7.1, please, in this document – I’m sorry, my note omits the page number – under the heading “Additional Litigation Support”, Fujitsu’s policy states:

“Where additional information to that described in the standard litigation support service is requested, RMGA shall view each request on a case-by-case basis, and in accordance with the Change Control Procedure.”

Were you aware that, other than the standard provision of ARQ data – which we can see was regulated by those two documents that we just looked at, the 720 or 15,000 query days – there were litigation support services outside of that.

David Posnett: I don’t recall. Yeah, I don’t recall.

Mr Beer: This document says that Fujitsu were going to view each request on a case-by-case basis. Would you understand that to refer to the provision by Fujitsu of witness statements and the attendance of witnesses at court?

David Posnett: Yes, on reading that.

Mr Beer: It refers to the Change Control Procedure. Do you know what a Change Control Procedure is or the Change Control Procedure was?

David Posnett: No.

Mr Beer: You didn’t know about a formalised mechanism by which a document was drawn up that contained a specification for the service required, provided limitations on the service to be provided and gave a cost or cost assumptions for the provision of the service, so it seemed like an amendment to the contract, essentially, for a bespoke activity?

David Posnett: I don’t remember that but …

Mr Beer: Did you ever receive any of those, or ask to comment on any of those, a change control notice?

David Posnett: I don’t recall. I mean, I notice at the top of this document Jane Owen from Security is mentioned.

Mr Beer: Yes.

David Posnett: I’m not in there. The previous one you showed, I think, Sue Lowther was the Post Office person, and the one before that was dated August 2006 which was before I was –

Mr Beer: You were doing something else then?

David Posnett: Yes. So I may have seen these documents or equivalents but I don’t recall them.

Mr Beer: I’m thinking more about the outcome of them, namely if something outside the standard was required, certainly Fujitsu thought that a rather specialised or rarefied change control notice procedure needed to be undertaken?

David Posnett: I don’t recall.

Mr Beer: We haven’t seen any evidence of that. What we’ve seen is some emails being exchanged between people asking for things.

David Posnett: Yeah.

Mr Beer: Can we look at paragraph 7.2, “Expert Witness Evidence”, Fujitsu’s policy says:

“Expert, in-depth analysis detailed ‘expert’ witness statements (as opposed to witness statements of fact) are rarely required.

“However, in the event of such a request, RMGA will endeavour to provide ‘expert’ witnesses who are able to give more detailed and specific evidence to support Post Office’s litigation activity. This ‘expert’ activity shall be provided on a case-by-case basis and shall be dealt with in accordance with the Change Control Procedure.

“Again, RMGA shall use reasonable endeavours to meet dates notified by Post Office limited for the production of this material and support.”

First off, I think you can see that this policy draws an explicit distinction or difference between the provision of evidence of fact and expert evidence.

David Posnett: Yes.

Mr Beer: Was that a distinction with which you were familiar at the relevant time?

David Posnett: Not that I recall, no.

Mr Beer: Were you aware that Fujitsu drew a distinction between the provision of evidence of fact and expert evidence?

David Posnett: Not that I recall, no.

Mr Beer: Were you aware that – I think I know the answer – that Fujitsu said that this specialised change control procedure needed to be brought into effect if expert evidence was required?

David Posnett: I don’t remember that.

Mr Beer: Was that distinction between expert evidence and evidence of fact ever something that you saw in practice in administering these ARQ requests or other litigation support requests?

David Posnett: Not that I recall. If a statement was required, Fujitsu would provide that statement. I didn’t see any distinction between what’s written down here.

Mr Beer: So when we saw that ARQ request you filled out earlier, the Misra one, asking for a witness statement which said that the system was working properly at all material times – I’m summarising – would you have seen that as a witness statement of fact or expert evidence, or an expert witness statement?

David Posnett: Hopefully both.

Mr Beer: Why both?

David Posnett: Because we would want the statement to say it was working correctly, if it was working correctly, and whoever provided the statement would be the expert providing that view.

Mr Beer: Did you expect any such statement from Fujitsu to contain an analysis to support a suggestion that Horizon was functioning correctly or with integrity?

David Posnett: Yes.

Mr Beer: Did you expect any such statement to explain what enquiries had been undertaken in order to be able to make a statement that Horizon was functioning correctly or with integrity?

David Posnett: Yes.

Mr Beer: What analysis would you expect, as an Investigator, to have been undertaken, if any, in response to a request for a statement which said that Horizon was functioning correctly or with integrity?

David Posnett: If that was in the statement of the person from Fujitsu, I would expect them to explain, not that I would understand it, what they’ve actually done to verify that the system is working correctly.

Mr Beer: Putting it another way, was the request for ARQ data seen by you and your colleagues to be a request for Fujitsu to perform, essentially, an administrative task, ie harvesting data from the system and providing it to you, or was it also a request for their qualitative analysis of what that data showed?

David Posnett: I would say both, given their knowledge and experience. Yeah, both.

Mr Beer: At the time that you were either an Investigation Manager or you were working in the Casework Team, or when you were working as an Accredited Financial Investigator, so in any of those roles, did you have the technical skill and knowledge to be able to subject audit data, ARQ data, to detailed technical analysis?

David Posnett: No.

Mr Beer: Did any Investigator have such expertise?

David Posnett: Some were more IT literate or au fait with technical things than others.

Mr Beer: That’s a slightly different issue. Did any of them have sufficient skills or training to be able to analyse the raw ARQ data?

David Posnett: I don’t know. I don’t think so. I mean, I don’t think we relied on colleagues for that purpose.

Mr Beer: Were you aware of any colleagues doing that function themselves, ie getting the data and trying to read it, trying to analyse it, and themselves come to a view as to what it showed?

David Posnett: I think the only person I can recollect who would get involved to that depth would probably be the Crime Risk Analyst, which was Helen Rose, at the time.

Mr Beer: What time was that?

David Posnett: That would have been well between 2008 and 2010, and probably earlier.

Mr Beer: Did she, in fact, carry out analysis of raw ARQ data?

David Posnett: I don’t know if it was raw ARQ data but I’ve obviously seen a document where she’s looked at something and come up with the report or a view.

Mr Beer: Had you, as an Investigator, been trained to analyse ARQ data?

David Posnett: No.

Mr Beer: Had you and your colleagues received any training to spot any errors, bugs or defects disclosed in ARQ data?

David Posnett: Errors, bugs or defects, no. I can’t answer for them but I don’t think so.

Mr Beer: Would you have been able to identify within the ARQ data whether sufficient information had been provided to you, ie the dataset that you received, to be able to judge whether or not a transaction had been completed by the clerk or an SPM, a subpostmaster, as opposed to being a system-generated transaction?

David Posnett: In the cases I can recall that I dealt with myself, I had received adequate information from the transaction logs I’d requested.

Mr Beer: What does that mean?

David Posnett: Well, if I can give you an example of a case. A subpostmaster has got stolen pension books and he cashes five of them. Well, I used to get transaction logs and all five would have been cashed within the space of a minute, whereas ordinarily, if they were genuine, you would have customers queueing up and being paid out, and you would see the time of the encashments might be 7.00 in the morning, which was two hours before the Post Office even opened.

So that’s the extent to which I would get transaction and event logs, to prove that stolen foils had been cashed before the office is even open.

Mr Beer: I think in one of your earlier answers you said that you didn’t know or understand the distinction between what I’ve called standard ARQ data and enhanced ARQ data.

David Posnett: Yes.

Mr Beer: The latter of which had the facility to show that a transaction had been system generated rather than SPM generated?

David Posnett: I wouldn’t know.

Mr Beer: So I think it followed that you didn’t have the facility to be able to look at the ARQ data you received and say “Ah, that’s type A, not type B data”?

David Posnett: Correct. I’d see the data, I wouldn’t know which of those streams it came from.

Mr Beer: Can I turn to address an issue concerning problems identified with ARQ data between 2007 and 2009, which led to the proposal to make changes to the standard, as it was called, statement. You deal with this in paragraph 69 to 73 of your witness statement.

That document can come down from the screen.

So we’re dealing here with a problem that has been spotted by Fujitsu with the ARQ data that’s being produced and what was done about it, okay?

David Posnett: Yeah.

Mr Beer: Can we start, please, with FUJ00155399. Can we scroll down to Wendy Warham’s email, so this is 7 January 2009 – you’re not on copy at this time – directly to Sue Lowther and David X Gray, subject “Security Incident”:

“Sue, I have left you a voicemail as I need to update you on a recent issue that has occurred and been resolved but does have some short-term impacts. In summary the issue as follows:

“In December 2007 …”

Just note the time there, December 2007 –

David Posnett: Yeah.

Mr Beer: – and this email is being sent in January 2009:

“In December 2007, an occurrence was reported in one office where a stock unit rollover coincided with the end of day process running. This led to a previously unseen database lock where an administrative balancing transaction failed to be written to the local message store database. This generated a generic and non-specific software error which went unnoticed in the monitoring of events. A financial imbalance was evident and was subject to investigation by Fujitsu Service Support Centre and Post Office Limited. The financial imbalance has been resolved.

“A software [condition] was applied across the estate in early November 2008 to ensure that any such event generated would be monitored. Testing of that correction has established that the unmonitored error does not occur elsewhere in the system.

“Impact

“We need to work with the Post Office Limited to recheck the ARQs and reconfirm the data integrity during the period of May 2007 to November 2008 – Penny will do this.

“We need to discuss how we disclose the issue on the witness statements and we have some words which may be appropriate – both need to discuss and agree the words.

“Identify which witness statement we have supplied and are still awaiting court to confirm whether or not the data provided was May ‘07 to November ‘08 to (a) ensure events have been checked and (b) to recall and replace witness statements – Post Office and Penny.

“Further action

“Automate the message store alerts on the system so that no manual intervention is required …

“Education to ensure that this type of incident is raised as a Major Incident in the security stack so we can communicate and manage this in accordance with incident timescales.

“Apologies that this has not been communicated earlier but the review to security incidents should improve this issue.”

So, if we just scroll back up, please, this is talking about an historic problem with Horizon –

David Posnett: Yeah.

Mr Beer: – that may have had an impact from May 2007 onwards –

David Posnett: Yes.

Mr Beer: – which was discovered in 2007, December 2007, yes? An occurrence was reported –

David Posnett: Yes.

Mr Beer: – in respect of which a change was made in 2008, yes? But witness statements had been prepared for the purposes of criminal investigations and criminal proceedings which did not disclose this database lock, which affected balancing.

David Posnett: Yes.

Mr Beer: Correct? Is that a fair summary of this?

David Posnett: I think so.

Mr Beer: This was quite a serious issue, wasn’t it?

David Posnett: Yes.

Mr Beer: Can we turn, please, to FUJ00155400. Can we turn to page 3, please. If we just scroll, thank you, it’s your email of 7 January to Rob Wilson; can you see that?

David Posnett: I can, yes.

Mr Beer: It’s in relation to that same security incident, and you say:

“Rob,

“In relation to the standard witness statement Fujitsu provide:

“1) The following addition has been inserted (see bullet point 11 on page 5). This addition seems okay (it’s just another check that Fujitsu conduct – to ensure the ‘security incident’ doesn’t occur again).”

The addition is:

“Windows Events generated by the counters within the branch/time frame in question are checked to ensure the counters were functioning correctly.”

Then 2:

“The following additional paragraphs have been inserted, (page 7).”

If we just read that, the insertion:

“In December 2007, an occurrence was reported in one office where a stock unit rollover coincided with the end of day”, et cetera, et cetera.

You’ll see that’s drawn from the earlier email we looked at; can you see that?

David Posnett: Yes.

Mr Beer: So that was proposed to be inserted in the standard Fujitsu witness statement, ie revealing to people that there was a system fault which affected balancing transactions and which had not been spotted at the time. You say:

“I personally do not see the need for these. If there are no problems identified with the data relating to the case in question. Why inform anyone about a problem we have had within the network but possibly at one branch, if it bears no relation or relevance.”

Why did you form that view?

David Posnett: Because at the time, if it didn’t impact on post offices once Fujitsu had done their investigations, what was the point of putting it into a witness statement?

Mr Beer: Do you not agree that the exchange that we’d looked at alerted you to the fact that there could be bugs in the Horizon system, which impacted on financial integrity, including the integrity of audit data and they weren’t picked up by the system?

David Posnett: Again, I can’t put myself back there but I’ve mentioned previously that all computer systems have issues. I thought – I presume at the time I thought this was a localised issue that had been flagged up, so I looked at the details, as far as I could understand them, and my view is communicated to Rob Wilson, the Head of Criminal Law.

Mr Beer: But surely, Mr Posnett, you realise that this wasn’t concerning because it affected or potentially affected a small number of branches; the concern was it was an unseen that meant that part of a balancing transaction had not been recorded in the local message store and Fujitsu’s systems had not picked it up?

David Posnett: I can only repeat what I’ve just said.

Mr Beer: Do you agree, on reflection, that that’s a serious issue, that not only there’s a problem, all computer systems have problems, but the Fujitsu systems to identify it at the time did not identify it at the time?

David Posnett: In hindsight, given what we know now, I would change that paragraph.

Mr Beer: But even without what we know now, reflecting on it, is it not a considerable concern that what’s described as a “previously unseen” database lock had operated without the safety nets identifying it?

David Posnett: I can any say that what I’ve written there represented my personal view at the time, and that’s what I communicated to Rob Wilson, for his stance on it.

Mr Beer: Putting it another way, it revealed that there could be unseen bugs in Horizon?

David Posnett: Yes, but I didn’t look at that – I saw that as one localised problem.

Mr Beer: But why?

David Posnett: Well, perhaps, at the time, that’s the only particular problem that’s been referred to me. I didn’t look at that and think, “Oh, there’s bugs all over the place”.

Mr Beer: I’m not suggesting that it meant there are bugs all over the place. What it meant was that Horizon was a system that could have bugs that affected financial integrity and balancing and the system did not reveal itself to have them.

David Posnett: I understand that but, again, I can’t put myself back there, but to me it reads as though it was a one-off issue that had been flagged up to me, and I’ve given my view and Rob Wilson has given his view.

Mr Beer: Thank you.

We’ll end it there, sir. I think we’ll have to pick that up tomorrow.

Sir Wyn Williams: All right. So we begin again at 10.00 tomorrow. I’m sorry that your evidence has been truncated in this way, Mr Posnett, but, I’m sorry, it’s unavoidable this afternoon.

I don’t suppose you’ll want to, but if you do want to talk about your evidence this evening, resist the temptation. All right?

David Posnett: Yes, sir.

Mr Beer: Thank you very much, sir. 10.00 tomorrow.

Sir Wyn Williams: Yes.

(2.28 pm)

(The hearing adjourned until 10.00 am the following day)