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POST OFFICE LTD CONFIDENTIAL: INVESTIGATION, LEGAL
POLTD/0809/0082
Theft, Embezzlement, and Money Laundering
Name: WILLIAM JOHN QUARM
Rank: SUBPOSTMASTER Identification Code: 91
Office: PAIBLE SPOB Branch Code 147869
Age: Date of Birth:
Service: 14 YEARS 5 Date Service Commenced: 28 FEBRUARY 1994
MONTHS
Personnel Printout: At Appendix: C
Nat Ins No:
Home Address:
Suspended/Contract for 23/7/2008 ON AUTHORITY OF Brian Trotter Contracts
Services Suspended: Manager
Handed into custody: n/a
At: na
Charged: n/a
To be prosecuted by: Crown Prosecutor
Designated Prosecution Dave Pardoe , Fraud Strand Senior Security Manager
Authority:
Discipline Manager: Brian Trotter Contracts manager
Corporate Security Criminal Law Team
The following report relates to an incident at Paible SPOB Branch code 147869 Bayhead Shop
North Uist HS6 5DS. The incident was identified by Doug Heed of Post Office Audit team. The
audit had been requested because of the risk generated by a higher than normal level of cash
being held at the Branch. This had been identified earlier in the year during Operation Cupid
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+ because of the remoteness of the Branch no physical attendance had taken place. However
due to the diligence of Alex McKenzie Audit officer this Branch was once again put in the
headlights. Mr McKenzie brought the matter to the retail line’s attention which in turn led to the
intervention. A copy of the email trail is associated at Appendix “B”. Consequently the audit took
place on Wednesday 23 July 2008.
Financial assets to the value of £3943.84 were physically verified compared to the amount due
to Post Office® of £44221.60.
The difference between these figures is broken down as follows:
€ 40264.54 (-) Identified as a difference in cash figures
£ 0.12 (-) Identified as a difference in stock figures
£ 13.10 (-) Shortage declared in previous balance period of present
trading period
£ 40277.76 Total shortage
There were discrepancies found in stock unit AA where the stock unit was understated and the
ATM stock unit was overstated. Cash declarations did not match the actual figures on hand.
The figures were double checked at the time and the results recorded onto a P32 audit report.
This is held by Doug Heed Audit Officer. At the time of the audit no explanation was given by
Mr Quarm. All cash and stock were removed from the Branch and a final account produced.
The results were cascaded to the contracts manager and the Fraud Strand security team. Mr
Quarm’s contract for services was precautionary suspended on the authority of Brian Trotter
Contracts Manager. A copy of the auditor's written report is associated at Appendix “B”.
Subsequently the case was allocated to Raymond Grant for further enquiries to be made
Contact was made to arrange an interview with Mr Quarm. This interview took place at Paible
SPOB on Thursday 7th August 2008. Those present were Raymond Grant, Robert Daily and
Jonathan Bisset form Post Office Ltd and Mr William Quarm and William Macdonald.
The interview was tape recorded and commenced at 1050hrs. Mr Quarm was cautioned prior
to any questions being asked. He requested that his friend Mr William Macdonald be allowed to
be present. Form GS 003s was completed. A copy of which is associated at Appendix “C”. Initial
discussions took place about office procedures and other staff members responsibilities during
which Mr Quarm stated that he was the sole person who was responsible for producing daily
reports, cash declarations and producing the Branch Trading statements. Mr Quarm was
shown a copy of a letter dated 28" July 2008 which he had sent to Brian Trotter Contracts
Manager. After being allowed to read this letter he was asked if he was its author, he
acknowledged that he was. A copy of this letter is associated at Appendix “B”. Mr Quarm was
then asked to comment on its content. He restated that in autumn 2007 his private retail
business was in financial difficulty, he decided to sell some property assets that he had. Due to
planning delays the sale was not going though as fast as he would like and in January 2008 he
approached the bank with a view of borrowing money on anticipation of the sales going ahead.
He was given agreement in principle from the bank. Further delays meant his financial position
had worsened, Mr Quarm then used money from the Post Office to support his private retail
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2 of the business. He needed to pay for stock for his grocery business from his main
supplier who by this time was insisting on a weekly payment of around £4200. During the
course of this discussion Mr Quarm appeared to be in a bit of a daze and was not
understanding the questions put to him. He was asked if he was OK, he replied that because of
the interview he had not taken his daily medication. Raymond Grant allowed him time to do this
and confirmed that he was in a fit state to continue. Mr Quarm acknowledged that he was fine
and.wished to.cantinue. It.was explained to Mr Quarm
1... GRO_ ____} interview could be suspended. He advised Raymond Grant that
he was fit to continu hen asked how he removed the money from the Post Office Mr Quarm
was very hesitant to give details of how the £40277.76 came to be missing. He gave an
explanation that he would credit his Alliance and Leicester account no 1864947 with sums of
money equivalent to around £4200 every week without putting the cash in the till. He would
then use this money by means of drawing on this account by cheque payments to pay his
suppliers. He was shown various Bank Trading Statements and asked if these were signed by
him. He stated they were. He was then asked if they were an accurate reflection of the cash
and stock at the Branch at the time of their production he said they were not as he had inflated
the cash on hand figure to match what the Horizon system said he had on hand. This was done
to disguise the fact that he had taken the money. No one else knew of his actions. He knew
that he did not have permission to use Post Office money for his personal use. He stated that
he always intended to replace the cash on completion of the sale of his property. When asked if
he was in a position to repay the missing cash he stated that although the loan from the bank
had now been received he had decided to use this money to pay other creditors as they had
been pushing him for payments, indeed one supplier who supplied Mr Quarm with fuel for his
forecourt business had demanded payment prior to delivery. Once these creditors had been
paid there was insufficient funds left to pay back the money stolen from the Post Office. Mr
Quarm pointed out that he had had several mini strokes last summer and wished this to be
taken into consideration. Mr Quarm also stated that it was his intention to sell another piece of
property in order to provide funds to repay Post Office Ltd. The interview concluded at 1314
hours. Tape seals 071081,071078 and 071082 were signed by all present. The tape
transcripts have not yet been prepared. Copies of the tapes are available for examination and
are associated at Appendix “B”.
A notebook entry was made by Robert Daily at this time. A copy of which is associated at
Appendix “B”.
Due to the health condition of Mr Quarm and the inability to contact anyone in authority
because of the remote location of Paible SPOB it was decided by Raymond Grant following a
discussion with colleagues present that it would not be appropriate to conduct searches of Mr
Quarm’s home address. Mr Quarm gave assurances that he would forward copies of all his
bank, mortgage, and credit card accounts within one week of the interview.
Mr Quarm has admitted that since at least January 2008 he has taken advantage of his
position as sub-postmaster to use Post Office money for his own personal use and continued
doing so until the audit on 23 July 2008.
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ere are Post Office documents available for production which support the charges of theft
and embezzlement in addition to that is the letter dated 28 July 2008 which contains a
statement which says”! had no right to use Post Office money to prop up my business, I have
lived for the past six months in day to day expectation of a Bank Loan to make good any Post
Office shortage” The Branch Trading statements for these six months do not show any
shortages. In effect Mr Quarm is admitting to the production of false Accounts.
Mr Quarm lives on a remote Scottish island within a close knit community his status as sub-
ing i t him. In his letter dated 28 July 2008
L he cites this in mitigation of
him making improper judgements. He has self declared assets of around £300k and has
commissioned the sale of these in order to repay Post Office Ltd.
All Post Office witnesses are deemed to be reliable
The loss to Post Office Ltd is £40277.76.
This loss has been posted to the final account team at Chesterfield by Doug Heed on 23 July
2008.
Since the interview Mr Quarm has disclosed details and provided 12 months worth of
statements of his bank, credit card and mortgage accounts. These have still to be examined. Mr
Quarm has sent another letter dated accompanying these documents which declares that his
house and properties are on the market. Expected value £305k. These are in the possession of
Raymond Grant. In view of their volume they have not been photo copied but can be made
available for examination on request.
No NPA or Antecedents forms have been completed as this is a case for review under Scots
Law.
A typed copy of this report is associated at Appendix “C’”. In addition to this a typed copy of the
conduct report is also associated at Appendix”C’”.
This office was identified as being at risk in February 2008 under “operation cupid” however
it was deemed to be of a lower risk than other offices which were also identified at the time.
The office should have been subject to either telephone enquiries or rescheduled for a visit
later in the year but this did not happen. The matter was again brought to the attention of
the retail line in July 2008 by Alex McKenzie Audit Officer who highlighted the level of cash
holdings to his supervisors who in turn reacted swiftly to rectify the issue of ONCH levels of
risk. This led to early intervention and identification of the offender. Mr McKenzie should be
acknowledged to having played his part.
Mr Quarm has admitted to having abused his position as Sub-postmaster and taking
advantage of this position by crediting his personal bank account without putting money in the
till. He then went on to spend this money on goods which allowed his retail business to survive
It is clear that he gained a material advantage in doing so.
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In view of the admissions made by Mr Quarm and the sufficiency of evidence available to
support a successful prosecution, It is recommended that a report should be prepared and
submitted to the Procurator Fiscal’s department for its consideration as to what further future
action should be taken.
_ GRO
Fraud Advisor...
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