POL00307712
POL00307712
Initial Complaint Review and Mediation Scheme
Post Office Investigation Report
Branch Name: Winlaton Branch Code: 394329 Case Number: M056
Applicant Name: I Miss Kym Status of Case: I Mediation Date of 8 February
Elizabeth Application Appointment: I 2003
WYLLIE
Executive summary
Background
The Applicant was appointed as Subpostmaster at Winlaton Post Office on 8 February 2003. The
branch was audited on 10 September 2014 because the Applicant had declared shortfalls totalling
£33,142.96 (including £33,000 settled centrally on 28 July 2010) and the audit revealed a further
shortfall of £5,434.93. This led to the Applicant being suspended and the termination of her
contract on 21 October 2010.
Issues
The Applicant claims that the shortfalls and the termination of her contract were due to inadequate
training and various technical and equipment issues with Horizon, including a ‘phantom log on' issue.
The Applicant also refers to a lack of an audit trail within Horizon, a lack of support from Post Office,
unhelpful communications and a flawed investigative process.
Findings
Post Office's investigation process was fair and the Applicant was provided with adequate
opportunity to present her case, including at a conduct meeting with the Contract Advisor, an appeal
hearing (whereby more time was granted to gather information), and at an interview with security
investigators (as part of a separate investigation) during which she was legally represented.
There is no evidence that the Applicant was not appropriately trained or supported or that Post
Office's communications were unhelpful. There is no evidence in the Network Business Support
Centre logs (NBSC) of any intervention or ad hoc requests for training save for information on
training for a staff member.
The Applicant had hardware issues which resulted in equipment being replaced, including a base
unit in June 2008, but there is no evidence that equipment issues contributed to the loss.
Transaction and event logs for the period of the alleged ‘phantom log on' (on and around 29 July
2010, which the Applicant claims was because someone had logged on remotely) clearly show that
the error referred to by the Applicant was a result of User ID KWY001 remaining logged in on a
terminal for a period of 7 days, preventing her from rolling over her stock unit. Therefore there was
no phantom log on but simply an operator error by User ID KWY001.
There is evidence of unusual activity, incorrect procedures and multiple cash declarations made at
the Applicant's branch. This is contrary to the Applicant's assertions that her branch was well run
1
POL-BSFF-0145762
POL00307712
POL00307712
and that she followed all procedures including for balancing. Whilst those unusual practices could be
down to human error, it appears likely that they could have been used to conceal the losses in
branch. The evidence also shows that the Applicant was not carrying out cash variance checks on a
regular basis and this is evidence of a lack of adequate controls at the branch.
Post Office also considers that the Applicant's complaints about the audit process are unfounded.
The Auditors involved were adequately trained and had sufficient experience to carry out their roles.
Horizon does have an adequate audit trail and that is demonstrated by the clear audit trail that has
been used to address the alleged phantom log on as detailed above.
Overall conclusion
There is no evidence to suggest that the losses incurred by the Applicant were caused by any of the
issues raised in the Applicant’s CQR. Post Office concludes that the shortfalls incurred by the
Applicant were either the result of a series of operational errors or deliberate action. Horizon logs
show that the Applicant made cash declarations shortly after obtaining snap shots from Horizon
which suggests that the Applicant was concealing losses in the branch accounts.
The Applicant's complaint
The Applicant's Case Questionnaire Response (CQR) was accepted via Second Sight on 29 May 2014.
The COR raises the following issues:
Issue 1 Lack of Training and Support
© The Applicant claims that there was a lack of training on Horizon and a lack of support in
respect of the introduction and running of Horizon.
Issue 2 Monetary Discrepancies
The Applicant claims that a large misbalance of £33,000.00 in July 2010 could not be
explained and that she did not receive sufficient support from the NBSC when investigating
it.
«The Applicant says she declared £2,000.00 short on 9 September 2010 in good faith but this
had increased to a £5,000.00 shortage when the audit was completed on 10 September
2010. This shortage included stamps which the Applicant claims were very rarely used in the
branch.
Issue 3 the alleged lack of Proper Audit Trail and equipment issues
© The Applicant claims that there were “inexplicable problems with the technology with
respect to balancing and identifying how discrepancies occurred in the first place”.
© The Applicant claims that there were on-going problems during her period of tenure with
Horizon (particularly terminal 4) and after her precautionary suspension during the tenure of
the Temporary Subpostmaster who took over from her. She says these led to the terminal
2
POL-BSFF-0145762_0001
POL00307712
POL00307712
being removed and replaced.
The Applicant would like Post Office to consider the possible implications of equipment
failure as a contributory factor in the problems encountered at the branch. This includes:
‘Phantom Log On'
oc The Applicant claims that a 'phantom log on’ prevented her from completing the trading
period balance on 28/29 July 2010 In the Applicant’s initial application she does
acknowledge that she was advised to log on and out of every terminal (which Post
Office considers was the correct advice, as further detailed below).
Monthly Postage Labels Report Missing
© Labels produced on Horizon Terminal 4 were missing off weekly report for 4 weeks.
Issue 4 Audit of 10 September 2010 and Related Issues
e The Applicant claims that the audit was procedurally weak. In particular she claims
that:
o It was not conducted by ‘trained’ Auditors but by a Subpostmaster and a
Training Manager.
© The Applicant claims that the Post Office officers took the keys to her retail
premises thus preventing her deriving an income from the retail side of her
business.
© That Post Office assets were not properly accounted for and the Post Office
personnel entered her premises without her permission subsequent to the
audit.
Issue 5 Flawed Investigative Process
The Applicant claims that the investigative process conducted by Post Office was flawed.
She raises issues with the summary termination by Post Office of the Applicant’s contract for
services and costs and losses that have flowed from this.
Costs and Losses
The Applicant is seeking the following from the mediation process:
* Reimbursement of Applicant's Professional Advisors' costs (not quantified)
* Compensation for summary termination without cause iar
¢ Consequential loss -
POL-BSFF-0145762_0002
POL00307712
POL00307712
Case Review Actions
Summary of the information collated by Post Office
Information area Information provided with Information not available
this response for other reason
Customer Account
Correspondence
Network Business Support Centre Logs
Transaction Corrections
x
Horizon Service Desk Logs
Record of Audits
Transaction and Event Logs x
*Transaction Correction records are not available prior to 2 November 2005 **Records of
Horizon Service Desk Logs are only available from 12 September 2007 onwards and therefore there
>I ><) ><] ><] ><) ><
are only partial records covering the duration of the Applicant's tenure.
Customer Account
The current amount outstanding due to Post Office as of September 2014 is £38,518.32
Timeline of Correspondence and Meetings
10 September 2010 audit conducted (Doc 001 refers )
10 September 2010 Letter to Applicant confirmation of suspension of contract (Doc 002 refers)
20 September 2010 Letter to Applicant inviting for interview to consider summary termination of
contract for services. (Known as RTU (reasons to urge) interview (Doc 003 refers))
14 October 2010 RTU interview (Doc 004 refers)
21 October 2010 Letter to Applicant following interview advising of decision to summarily terminate
contract. (Doc 005 refers)
22 October 2010 Notification from Applicant stating willing to make premises available to a
Temporary Subpostmaster (Doc 006 refers )
25 October 2010 Notification from Applicant stating wish to appeal decision to summarily terminate
contract. (Doc 007 refers)
17 November 2010 Letter to Applicant notifying of date of appeal. (Doc 008 refers)
26 November 2010 Notification from Applicant that she will attend for appeal interview (date
amended from 30 November 2010 to 7 December 2010) (Doc 009 refers)
7 December 2010 Appeal Hearing (Doc 029 refers)
All correspondence sent to the Applicant was clear and provided the required information. Post
POL-BSFF-0145762_0003
POL00307712
POL00307712
Office does not agree that the Applicant's claim that correspondence was unhelpful is correct.
Network Business Support Centre call logs (Doc 010 refers)
During the period of the Applicant’s tenure (8/2/2003 -10/9/2010 730 calls were logged. Of these:
* 645 related to transaction or operational enquiries;
e 48 related to issues with Horizon and associated equipment;
¢ 27 related to contact request with Retail Line Manager (RLM) or later Business Development
Manager (BDM);
¢ 10 related to performance issues at the branch.
The calls made by year are listed below.
2003 (part year) 134 calls recorded
104 Transactional or Operational
14 Requested contact from Retail Line Manager
(RLM)
9 Related to performance issues in the branch.
7 Related to issues with Horizon or associated
equipment
2004 189 calls recorded
157 Transactional or Operational
11 Requested contact from RLM
1 Related to performance issues in the branch.
20 Related to issues with Horizon or associated
equipment.
2005 115 calls recorded
108 Transactional or Operational
1 Requested contact from RLM
6 Related to issues with Horizon or associated
equipment.
2006 76 calls recorded
74 Transactional or Operational
2 Related to issues with Horizon or associated
equipment.
2007 68 calls recorded
62 Transactional or Operational
5 Related to issues with Horizon or associated
equipment.
1 Requested contact from RLM
2008 57 calls recorded
56 Transactional or Operational
1 Related to issues with Horizon or associated
equipment.
2009 52 calls recorded
52 Transactional or Operational
2010 (part year) 39 calls recorded
32 Transactional or Operational
7 Related to issues with Horizon or
associated equipment.
POL-BSFF-0145762_0004
POL00307712
POL00307712
An analysis of call content can found in the source documents (Doc 011 refers)
Transaction Corrections (TCs) (Doc 012 refers)
TCs Applicant
A total of 56 TCs were issued to the Applicant during the period for which records are available,
being 3 November 2005 to 10 September 2010:
32 Invoice (amounts to be made good) total value £6,410.03
24 credit (amounts to be withdrawn) total value £ 2,991.42
Net amount £3,418.61 (-)
TCs Subsequent Subpostmaster
The following TCs were issued to the subsequent Subpostmaster during the period from 7 January
2011 to 19 March 2013
7 invoice (amounts to be made good) total value £480.26
2 credit (amounts to be withdrawn) total value £169.00
Net amount £311.26(-)
Horizon Service Desk (HSD) Logs (Doc 013 refers) HSD call analysis (Doc 014 refers)
HSD provides support to Subpostmasters for Horizon hardware and software issues as opposed to NBSC who
provided transaction and operational support.
HSD logs for the period 12 September 2007 to 22 June 2011 were examined. These include the
period of tenure of the Temporary Subpostmaster. Post Office no longer holds records of HSD logs
for prior to 12 September 2007 and therefore these records are not available for review.
During the Applicant’s period in office there were some equipment issues which resulted in engineer
visits on site, although some were resolved by HSD instructing the Applicant to perform a reboot.
The engineer on visit to site would either repair or swap out the hardware in question. Items
replaced during the Applicant’s period of tenure included printers, pin pads, a base unit and
monitors. The equipment removed from the branch would be returned to be repaired and cleaned
and then reused. This is standard practice across the Post Office network.
A call was made to HSD on 5 July 2010, close to the time of the Applicant declared a large
discrepancy. The call related to non-polling (polling was the method of transferring data to a central
point prior to the introduction of HOL). Records show that this issue was resolved unassisted (by
rebooting) and the call was closed on 6 July 2010. There was no cash variance declaration made for
stock unit AA on 5 July 2010; stock unit CAC declared a surplus of £14.51; stock unit JAN declared a
surplus of £59.56; and stock unit HCH declared a surplus of £288.08.
POL-BSFF-0145762_0005
POL00307712
POL00307712
Terminal 4 was replaced on 14 January 2011 (after the Applicant's period of tenure) due to a corrupt
disc and bad blocks showing. The corrupt disc would relate to the disc in the base unit that holds
information relating to HOL help and would not affect the functioning of the terminal, although HOL
help may not be available which could cause inconvenience. Bad blocks can prevent the counter
from functioning depending on which blocks are bad. This can range from ‘Blue screen-unable to
boot’ to products not being available when they should be. This would either make Horizon run
slowly or not at all but would not cause discrepancies in the branch accounts.
The Applicant also refers to "end point down" within her CQR, which she says could cause problems
sending communications from the terminal to the wider network. If the system shows messages that
‘end point is down' the impact of this would be that no Tivoli Endpoint Manager (TEM) processes
could be run. TEM application allows the Tivoli (sysman) management software and the counter to
communicate with each other. This could not create discrepancies as the terminals would close
down.
NBSC call logs show that in mid-2004 there were a number of issues at the branch with regard to
maintaining on line services. However HSD logs are no longer available for 2004 and, as stated
above, these issues would not have caused discrepancies in the branch accounts
Record of Audits (Doc 015 refers
10 September 2010
Cash £4,835. 76 (-)
Stock and Postage £294.09 (-)
Foreign Currency £279.08 (-)
Cheque Discrepancy £26.00 (-)
Shortfall held at Finance Service Centre (FSC) £33,000.00 (-)
Total £38,434.93 (-)
The £33,000.00 shortfall related to a balancing discrepancy transferred to FSC (settled centrally ) on
28 July 2010
Transaction and Event Logs June- September 2010 (Doc 016 refers)
Transaction and Event logs for the period June-September 2010 are shown within Doc 16.
Response to issues raised by Applicant
The responses below make reference to certain technical terms. Some technical terms are
explained in document 26 and these responses should therefore be read in conjunction with that
document.
Issue 1 Lack of Training and Support.
The Applicant claims that there was a lack of training on Horizon and this includes an allegation of
a lack of support provided by Post Office in respect of the introduction and running of Horizon.
POL-BSFF-0145762_0006
POL00307712
POL00307712
Horizon training in general
Records show that the Applicant received one week's classroom tuition at South Shields Counter
Training Office during the week commencing 27 January 2003 prior to taking up appointment as
Subpostmaster of Winlaton Post Office (not two days as claimed by the Applicant). On
appointment the Applicant received 10 days on- site support from 7 February 2003 to 18 February
2003 and one day additional balancing support on 19 February 2003 (Doc 027 refers). The
training would have included the use and functions of Horizon transactions, balancing and how to
deal with discrepancies.
The training would have been carried out by a Field Support Advisor (FAS). FSAs are part of Post
Office's Field Support Team which is responsible for induction and on-going transactional training
for all Subpostmasters. The FSAs are multi-skilled advisors who provide support to the network of
branches and this includes delivering training, dealing with Subpostmaster queries and auditing.
The standard training package was considered adequate for the role undertaken and the training
the Applicant received had more days’ onsite training than was included in the standard training
package (and therefore had additional training). However, there are no records to indicate why
additional training was supplied (ie as to why there were more days’ on site training than would
usually be the case if classroom training is undertaken). This is usually due to the size of the
branch, the complexity of the transactions undertaken and/or the number of staff to be trained.
The Applicant or the on-site FSA would also have been able to request additional training via NBSC
had either considered it necessary.
There was other support available to the Applicant at the time through three main channels-
1) Operational Instruction Manuals (paper based copies held in branch and updated
monthly), Operational Focus weekly updates and guidance on transactions and services and
Memo view- messages direct from the Horizon terminal.
2) the NBSC (a telephone helpline) and
3) Network Line management (RLM).
All of the above were available to the Applicant during her period of tenure.
NBSC logs have been examined for the Applicant's period of tenure. Although there are no
records of the Applicant requesting additional training, there is one request made for information
about training for a member of staff on 2 June 2004. There are no records of any other requests
for training either pre or post HOL introduction. There are no records to indicate if the requested
information was supplied to the Applicant but as no further requests were logged it is reasonable
to assume that it was.
There were several calls made by the Applicant regarding procedural errors made (9 in the first
year and 1 in the second year). Most relate to errors made when completing Post Office card
account applications. After reminders and intervention from the branch's Retail Line Manager the
POL-BSFF-0145762_0007
POL00307712
POL00307712
errors ceased.
Horizon Online
The Applicant also refers to the introduction of HOL in her CQR and appears to suggest its
introduction may be relevant to the loss uncovered in her branch. The introduction of HOL was a
phased programme of software upgrades and Winlaton Post Office was migrated to HOL over the
evening/night of 21/22 July 2010.
Records show that a migration officer was present to deliver on site support during the migration
procedure on the afternoon/ evening of the 21 July 2010 and was present the following morning
to ensure the Applicant and her staff were conversant and confident with the changes in
processes. The migration process also included a physical check of cash on hand in the branch.
The £33,000 shortfall referred to in the Applicant's CQR was noted by Post Office during this visit.
Prior to the migration a DVD and workbook was supplied to all branches to aid in the transition
process. After migration, the paper based Horizon operation manuals were replaced with HOL
help, a computerised version of the paper manuals.
Conclusion
Post Office considers that the training delivered was adequate and proportionate for the role the
Applicant undertook and the Applicant appears to have had a longer period of training than the
standard package. Additionally, other support was available to the Applicant and NBSC call logs
show that the Applicant made limited use of this facility. Training materials were provided to the
Applicant when HOL was introduced.
Issue 2 Monetary Discrepancies
The Applicant states that in early July 2010a large discrepancy of £33,000.00 arose in stock unit
AA. The Applicant believes the shortfall was unexplained and complains about the support she
received in relation to this.
The Applicant declared a shortfall of £2,000.00 on 9 September 2010 but this had increased to
£5,000.00 when the audit was completed on 10 September 2010. This shortage included stamps
but the Applicant claims stamps were very rarely used in the branch.
The balancing records that are available for the Applicant’s period of tenure are limited (Doc 017
refers). The records available show that the following discrepancies were declared:
Date Loss/Gain Amount
30 July 2009 Gain £133.98
27August 2009 Gain £790.22
24 September 2009 Gain £88.73
29 October 2009 Loss £439.81
26 November 2009 Loss £94.17
24 December 2009 Loss £395.86
9
POL-BSFF-0145762_0008
POL00307712
POL00307712
25 February 2010 Gain £11.88
25 March 2010 Gain £391.12
29 April 2010 Gain £115.91
27 May 2010 Gain £33.05
24 June 2010 Loss £162.64
29 July 2010 Loss £33,142.96
25 August 2010 Loss £90.35
10 September 2010 (Final Loss £5,434.93
account discrepancy)
After the Applicant’s suspension a Temporary Subpostmaster was appointed to operate the
branch from the same premises with the same Horizon terminals and staff.
The Temporary Subpostmaster declared the following discrepancies.
Date Loss or Gain Amount
25 November 2010 Gain £43.54
22 December 2010 Loss £132.70
26 January 2011 Loss £2.02
23 February 2011 Gain £147.63
24 March 2011 Loss £50.29
27 April 2011 Loss £60.12
25 May 2011 Loss £16.68
22 June 2011 Loss £32.93
27 July 2011 Loss £287.03
24 August 2011 Gain £30.03
21 September 2011 Gain £20.22
26 October 2011 Gain £8.17
23 November 2011 Loss £11.83
21 December 2011 Gain £2.52
25 January 2012 Gain £1.03
22 February 2012 Gain £11.19
21 March 2012 Gain £3.12
Total Gain £267.45
Total Loss £593.60
Net Loss £326.15
Due to the risk of human error, the volume and variety of transactions branches may not reach an
exact balance. Apart from the two discrepancies declared on 29 July 2010 and discovered in the
audit on 10 September 2010 the balancing results declared by the Applicant are not considered by
Post Office to be unusual.
As part of this review Post Office contacted the Temporary Subpostmaster appointed following
the Applicant’s precautionary suspension. The Temporary Subpostmaster reported no issues with
the Horizon equipment and she could not recall any terminals being replaced during her period of
10
POL-BSFF-0145762_0009
POL00307712
POL00307712
tenure. The Temporary Subpostmaster employed the two members of staff who had previously
worked for the Applicant and found no cause for concern over their performance. She did report
one occasion on which she could not roll over a stock unit but this was resolved by logging out a
user who had been left logged in on the system. This account contradicts the Applicant’s claims
regarding the Temporary Subpostmaster’s tenure.
HSD logs show that terminal 4 was replaced on 14 January 2011 (4 months after the audit of 10
September 2010 and six months after the Applicant’s reported cash shortfall) due to an issue
detected at HSD. The branch was contacted and advised of the need to swap base units. There
were no reported issues in the branch at that time and the next trading statement completed
after the base unit was swapped on 26 January 2011 revealed a shortage of £2.02.
The Applicant reported a discrepancy of £33,142.96 on completion of the trading statement of 29
July 2010. The transaction and event logs for June and July 2010 have been examined as part of
this review. In particular the AA stock unit that the Applicant states was the stock unit the
discrepancy arose in and was held by her as referred to at the RTU and investigation interviews
(Docs 016 023 024 and 025 refer)
Although there is evidence that cash declarations were made daily by the user of AA stock unit a
variance check (which details the discrepancy between the amount reported as being on hand by
the User and amount Horizon expects to be on hand based on transactions completed since the
last balance) was not always performed as part of the process. Although this is not mandatory it
is considered good practice and variance checks were completed on some occasions which would
indicates that the operator knew how to perform them. There are instances when a balance
snapshot has been produced immediately before the cash has been declared. By doing this the
user would be able to identify any discrepancy without recording the actual discrepancy revealed
on the Horizon data retained. It would also allow the user to identify how much cash was
required to make the stock unit appear to be holding the correct amount of cash without
completing a physical count.
Examples of the activity described above for the period 1 July 2010 to 20 July 2010 (taken from
Doc 016)
Date Balance Cash Declaration Stock Unit User ID
Snapshot Made
produced
30/6/2010 11:51:40 11:56:14 CAC LLAOO1
30/6/2010 16:34:41 16:35:02 ATM Kwy003,
30/6/2010 15:37:32 16:17:35 JAN Kwy003,
30/6/2010 16:40:16 16:40:17 HCH Kwy001
1/7/2010 16:32:38 16:40:38 HCH Kwyo01
1/7/2010 16:33:25 16:34:24 ATM KWwyY003
2/7/2010 16:32:19 16:43:19 ATM Kwyo01
2/7/2010 15:52:39 15:54:49 JAN Kwy003
2/7/2010 16:32:53 16:41:31 HCH Kwyoo1
11
POL-BSFF-0145762_0010
POL00307712
POL00307712
3/7/2010 11:03:53 11:47:12 JAN Kwy003
3/7/2010 11:39:03 11:58:49 HCH Kwy001
3/7/2010 12:12:38 12:27:31 AA Kwyo03
5/7/2010 16:36:24 16:38:48 ATM Kwy003,
5/7/2010 16:45:55 16:53:28 HCH kwyo01
5/7/2010 17:06:31 17:13:45 AA kKwyo01
6/7/2010 16:26:27 16:30:10 JAN Kwy003
6/7/2010 16:37:50 16:39:02 ATM Kwy003
6/7/2010 16:41:10 17:16:36 AA Kwyo01
7/7/2010 16:27:59 16:34:49 JAN kKwyo003
7/7/2010 17:28:56 17:29:17 ATM Kwyo03
7/7/2010 16:46:49 16:58:26 HCH Kwy001
7/7/2010 17:30:58 17:31:13 AA Kwy003
8/7/2010 15:41:41 16:19:14 JAN Kwy003
8/7/2010 16:21:18 16:32:31 AA Kwy003
8/7/2010 16:38:39 17:02:30 HCH Kwyo01
9/7/2010 16:35:16 16:44:25 AA Kwy003
9/7/2010 16:15:57 16:18:18 JAN kwyo003
9/7/2010 16:33:06 16:34:26 ATM Kwy003
9/7/2010 16:34:32 16:53:29 HCH Kwy001
10/7/2010 11:35:14 11:41:29 HCH Kwyo01
12/7/2010 16:31:56 16:44:47 AA Kwy003
12/7/2010 16:42:20 16:48:09 HCH kKwyo01
13/7/2010 15:58:02 16:19:48 JAN Kwy003,
13/7/2010 16:35:50 16:39:23 ATM KwyY003
13/7/2010 16:42:41 16:49:32 AA KWyY003
13/7/2010 16:50:09 16:59:01 HCH Kwy001
14/7/2010 16:23:45 16:25:06 JAN kwyo03
14/7/2010 16:25:06 16:33:50 AA Kwy003
14/7/2010 16:38:03 16:49:16 HCH Kwyoo1
14/7/2010 16:38:40 16:40:01 ATM Kwy003
15/7/2010 15:45:34 16:50:06 CAC Kwyo01
15/7/2010 16:34:39 16:34:56 ATM kwyo03
15/7/2010 16:37:08 16:43:33 HCH Kwy001
16/7/2010 16:35:34 16:35:53 ATM kwy003
16/7/2010 16:38:13 16:45:06 HCH Kwy001
17/7/2010 11:37:14 11:47:28 HCH Kwy001
19/7/2010 15:53:54 16:07:55 JAN Kwy003,
19/7/2010 16:34:22 16:37:14 ATM Kwy003.
19/7/2010 16:40:11 17:15:31, HCH kwyo01
19/7/2010 16:52:36 17:05:01 AA kwyo03
20/7/2010 10:49:28 15:34:37 JAN Kwyo01
12
POL-BSFF-0145762_0011
POL00307712
POL00307712
20/7/2010 16:13:24 16:23:41 AA Kwyo01
20/7/2010 16:35:03 16:38:17 ATM Kwy001
20/7/2010 16:49:31 16:56:05 HCH kwyo01
Although the branch was operating individual stock units, on the majority of occasions the
Applicant declared the cash in all stock units. The Temporary Subpostmaster has advised
that when she took control of the branch she had to instruct the staff who had previously
worked for the Applicant on how to declare cash and perform a variance check.
In the period examined above there are also two unusual multiple entries and it is possible
that these entries were made to achieve a more favourable cash position within a stock
unit. They could be due to simple keying errors i.e. an incorrect amount entered but
would seem unlikely particularly when the entries for 8 July 2010 are examined.
The entries in the next table were made on 5 July 2010 by User ID KWY003 on JAN stock
unit:-
Time Declare cash Variance
16:26:40 £2,355.80 110.90 (+)
16:27:22 £2,354.61 109.71(+)
16:29:19 £2,354.61 109.71 (+)
16:29:39 £2,304.61 59.71 (+)
All the entries in the next table were made on 8 July 2010 by User ID KWY001 on HCH
stock unit
Time Declare Cash Variance
16:56:25 £5,239.89 32,624.79 (-)
16:59:59 £49,019.83 £11,155.17(+)
17:00:53 £39,019.85 £1,155.17
17:02:30 £38,019.85 £155.17 (+)
There are anomalies in the figures reported. On 30 June 2010 at 16:24:22* User ID KWY003
KWY003 (also believed to be the Applicant) as £91,458.83 and again no variance check was
30 June 2010 and 16:10:41 on 1 July 2010:
(believed to be the Applicant) declared cash on hand in AA stock unit as £11,758.83 and there was
no variance check performed. On 1 July 2010 at 16:10:41 cash on hand was declared by user ID
completed. There were two transactions completed on the AA stock unit between 16:24:22 on
1 Transaction and Event Logs do not take account of BST
13
POL-BSFF-0145762_0012
POL00307712
POL00307712
1) Production of the Postmasters Daily Record (facing sheet) for Green Giro cheques which
would have no effect on the cash on hand figure.
2) Cash remittance (money sent to the branch by Post Office’s cash centre to enable the
branch to supply cash to the customers) of £85,000.00 accepted.
In the absence of any other transactions, the cash on hand figure should have risen by £85,000.00
(remittance) to take account of the cash received. However the difference between the two
amounts £11,758.83 declared at 16:24:22 on 30 June 2010 and that declared at 16:10:41 on 1 July
2010 of £91,458.83 is £79,700.00, which is £5,300.00 less than what would be expected. Given the
limited data available this could be a simple error but it could also indicate that the cash was
previously inflated and now correctly declared.
The following cash declarations were made on stock AA in July 2010:-
Date Terminal Time Amount Declared £ Variance £
1 July 2010 3 16:10:41 91,458.83 None performed
2 July 2010 3 16:03:17 91,458.83 None performed
2 July 2010 3 16:20:36 81,458.83 None performed
3 July 2010 4 12:27:31 53,724.38 43,690.60 (-)
5 July 2010 4 17:13:45 40,826.38 None performed
5 July 2010 4 17:17:12 40,826.38 None performed
6 July 2010 3 17:16:36 39,711.48 None performed
7 July 2010 3 17:13:10 28,089.36 45,859.20 (-)
7 July 2010 3 17:31:13 28,089.36 34,049.20 (-)
7 July 2010 3 18:02:04 28,089.36 34,049.20 (-)
8 July 2010 3 16:32:31 12,265.57 None performed
9 July 2010 3 16:44:25 12,359.86 70.50 (+)
10 July 2010 3 08:52:40 12,459.86 None performed
10 July 2010 3 11:15:12 12,359.86 None performed
12 July 2010 3 16:41:47 10,578.52 None performed
13 July 2010 3 16:49:10 22,346.99 None performed
13 July 2010 3 16:49:32 12,003.99 1485.37(-)
14 July 2010 3 16:33:50 12,410.56 21.20(+)
15 July 2010 3 15:28:11 12,431.56 None performed
16 July 2010 3 16:14:18 14,931.56 None performed
17 July 2010 3 09:47:13 14,931.56 None performed
19 July 2010 3 17:05:01 15,472.86 583.50 (+)
20 July2010 4 16:23:41 17,670.58 18.78 (-)
22 July 2010 4 16:59:37 17,733.95 44.59 (+)
23 July 2010 4 16:29:34 17,733.95 None performed
24 July 2010 4 11:50:17 17,864.19 None performed
24 July 2010 4 11:50:40 17,864.19 None performed
24 July 2010 4 11:50:48 17,864.19 166.13 (+)
14
POL-BSFF-0145762_0013
POL00307712
POL00307712
26 July 2010 4 16:48:47 17,893.51 None performed
26 July 2010 4 16:48:58 17,864.19 18059.64 (+)
27 July 2010 4 16:07:48 15,864.19 18059.64 (+)
27 July 2010 4 16:09:49 15,864.19 None performed
27 July 2010 4 16:10::09 15,864.19 18059.84 (+)
28 July 2010 3 17:36:32 16,300.34 None performed
28 July 2010 3 17:36:53 16,300.34 None performed
28 July 2010 3 17:44:58 16,300.34 18,265.60 (+)
28 July 2010 3 17:47:39 16300.34 None performed
28 July 2010 3 17:47:57 Nil 17893.51 (-)
28 July 2010 3 17:58:25 16300.34 None performed
29 July 2010 3 16:25:49 16175.99 None performed
29 July 2010 3 16:25:58 16175.99 124.35(-)
31 July 2010 3 11:12:26 16175.99 None performed
31 July 2010 3 11:46:55 53472.50 None performed
31 July 2010 3 11:47:05 53472.50 5722.16 (+)
In Summary
It is evident that there was only 19 cash variance checks performed on AA stock unit during July
2010. Many days are missed and multiple checks are made on other days. There was alsoa
substantial amount of cash stated to be held within the AA stock unit on 1 and 2 July 2010.
Transaction logs also show that between 16:10:41 on 1 July 2010 (time and date of cash
declaration see above) and 16:03:17 on 2 July 2010 (time and date of cash declaration see above)
there was a transfer of £10,500.00 but the cash declared on each occasion was the same. This
would suggest that cash declarations were not being accurately completed.
The Applicant cites that postage stamps were reported as missing and as postage stamps were
very rarely used this casts doubt on the audit result.
Stock and stamps are categorised as 1p to £5, definitive postage stamps are classed as postage
stamps and other stock items (e.g. stamp books) are classed as volume stock.
The actual discrepancy reported for 1p to £5 postage (i.e. postage stamps) at the audit on 10
September 2010 was a surplus of £70.99. For the purposes of the audit report this has been
added to the shortage reported in the volume stock and recorded as one shortage figure of
£294.09 in stock. (Doc 015 refers)
The discrepancies in the volume stock were as follows:
Product Amount I Product Amount
1* class stamps £38.95 (+) I Air Letter Pkts £3.99 (-)
1* class large stamps £2.64 (+) I Stamp Books 4 x 1st Large £7.92 (-)
Xmas Air Letters £1.58 (+) I Stamp Books 4 x 2nd Large £293.76(-)
15
POL-BSFF-0145762_0014
POL00307712
POL00307712
Recorded Signed For £18.40 (-) I First Day Envelopes £16.80(-)
1 Class Stamps
24 Class Stamps £8.64(-) Lest We Forget Presentation Packs £32.70 (-)
2" Class Lrg Stamps £2.04(-) Darwin Presentation Packs £24.00(-)
These amounts were verified with the Applicant on the day of the audit. All cash and stock was
subsequently defunded from the branch and would have been subject to a further verification
upon receipt in the cash and stock centres. Any discrepancies found would have been processed
via the late account process
Subsequent to the audit on 10 September 2010 which revealed a shortage of £38,434.93 there
were no corresponding errors found to explain the shortfall.
Conclusion
The Applicant was not carrying out cash variance checks on a regular basis which, if carried out,
would have enabled her to identify and investigate losses. Rather, the Applicant printed snap
shots and then made cash declarations shortly afterwards which suggests that she was aware of
losses and made false declarations to conceal them.
Issue 3 the alleged lack of a Proper Audit Trail and equipment issues
The Applicant claims that there were “inexplicable problems with the technology and audit trail of
Horizon in respect of balancing and identifying how discrepancies occurred in the first place”.
There are a number of tools on Horizon that can assist Subpostmasters with tracing or identifying
discrepancies. For example, transaction logs can be run which show the transactions that have
taken place and these logs can be searched using parameters such as product type, user and time
of the transaction. Event logs also provide information about user activity and a balance snapshot
shows what Horizon believes is the state of the branch accounts at that point in time.
Therefore Subpostmasters can ascertain what transactions have taken place in branch and the
amount that has been recorded against that transaction. Pre Horizon Online (pre 2010) Horizon
reports were available in branches for 42 days. Now these reports are available in branch for 60
days.
Support and assistance was also available and accessed by the Applicant’s husband, from FSC and
the Contracts Team.
The Applicant claims that there were on-going problems with Horizon (particularly terminal 4 in
her branch) including during the period after her precautionary suspension when the branch was
run by a Temporary Subpostmaster, which led to terminal 4 being removed and replaced.
Post Office’s response in relation to this issue is set out under Issue 2 above. In short, terminal 4
was replaced due to an issue that was not capable of causing discrepancies in the branch
accounts.
16
POL-BSFF-0145762_0015
POL00307712
POL00307712
The Applicant says she would like Post Office to consider the possible implications of the following
issues as a contributory factor in the problems encountered at the branch.
‘Phantom Log On”
The Applicant claims that a phantom log on prevented her from completing the trading period
balance on 29 July 2010 (Post Office records show that the issue she refers to was 28 and 29 July
2010 but there was no “phantom log on” as explained below).
Examination of the event logs for July 2010 reveal that there were 22 unsuccessful attempts made
to “roll” stock unit HCH from trading period 4 to trading period 5 on the 28/29 July 2010. Eleven
attempts on 28 July 2010 and eleven further attempts on 29 July 2010 before user ID KWY001 was
able to roll stock unit HCH successfully at 07:54:51 on 29 July 2010 (Doc 016 refers ).
On each occasion that the stock unit HCH failed the same error message was displayed by Horizon
as “balance of SU HCH failed. Another user is signed on / awaiting recovery.” The Applicant claims
this as evidence of a phantom log on and says she believes that this was being conducted
remotely.
Records show that on 22 July 2010 User ID KWY001 (presumed to be the Applicant) logged on to
Horizon terminal 1 at 07:19:12 at which point a password change was enforced. Once completed
user ID KWY001 successfully logged on and the User ID was attached to HCH stock unit at
07:23:12.
At 07:29:38 User ID KWY001 declared cash in HCH but crucially did not log out on terminal 1.
At 07:31:18 user ID KWY001 attempts to log onto terminal 4. An error message advising the user
that there is a concurrent log in has been detected for user KWY001 awaiting user response to
continue or cancel is ignored and the continue icon pressed at 07:31:28 as detailed in the event
logs and counter 1 is marked as failed at the same time as KWY001 logs on. There is no log out
recorded at this point on terminal 4. (Doc 016 refers)
The effect of the above is that KWY001 would have been simultaneously logged in to terminals 1
and 4.
At 07:32:54 User ID KWY001 attempts to log onto terminal 3. An error message advising the user
that a concurrent log on has been detected for user KWY001 awaiting user response to continue or
cancel is ignored, the continue icon was selected at 07:33:42 and User ID KWY001 is logged on
and counter 4 is marked as failed (07:33:42). User KWY001 logs out for terminal 3 at 07:34:03
At 07:37:54 User KWY001 logs onto terminal 4 at 07:37:54 and serves all day. At 17:00:52 user ID
KWY001 is logged off this action corrects the earlier failure noted on terminal 4. However, the
same user ID remained logged in to terminal 1.
On 28 July 2010 at 07:39:20 user ID KWY001 logs on terminal 4 the user remains on terminal 4 all
day serving and successfully ‘rolls’ stock unit ZZZ at 08:28:15. At this point there is one remaining
stock unit to balance and ‘roll’ which is HCH. As all other stock units had been successfully ‘rolled’
17
POL-BSFF-0145762_0016
POL00307712
POL00307712
On 28 and 29 July 2010 there are 22 attempts to balance and ‘roll’ stock unit HCH as follows; all
attempts are made on terminal 4:
28 July 2010 29 July 2010
17:22:27 17:52:07 07:14:18 07:38:28
17:22:42 17:55:20 07:18:19 07:43:38
17:24:32 17:55:32 07:20:35 07:44:26
17:24:40 17:59:50 07:27:58 07:47:31
17:26:02 18:00:58 07:30:04 07:49:50
17:27:14 07:30:41
On 28 July 2010 there are no recorded telephone calls requesting assistance with balancing made
to NBSC or HSD. There is one call to NBSC made at 09:30:04 re postage reports (see monthly
postage labels below).
On 29 July 2010 at 07:13:40 User ID KWY001 logged onto terminal 4 at 07:13:40 there are then
eleven unsuccessful attempts to ‘roll’ stock unit HCH (as listed above). At 07:47:01 User KWY001
moved to terminal 1 and logged on. At 07:49:57 User ID logged off at terminal 1 which cleared
the failed session from 22 July 2010 and corrected the failure to log out of terminal 1 from 22 July
2010. At 07:50:25 user ID KWYO001 logged on at terminal 4 and was able to successfully ‘roll’ HCH
stock unit at 07:54:51.
Accordingly, the reason that the Applicant was seeing a message on terminal 4 saying she was
already logged on was she had remained logged on to terminal 1 since 22 July 2010. Once she
logged out of terminal 1 she was able to roll over.
Two calls related to this issue are recorded by NBSC both on 29 July 2010.
Call 108:23:43 from the Applicant was reported as “trying to balance keeps getting a recovered
session”. There is no record of the advice given by NBSC other than they referred to their
knowledge base (the knowledge base is a reference system used by NBSC operators to ensure
they offer the correct advice to Subpostmasters).
Call 2 08:40:48 from the Applicant was reported as “group A, meant to balance yesterday saying
stock unit cannot roll over attached user session not done or not logged in. No recovered sessions
There is no one else logged in spoke to Horizon said he has come across this before said need to
take people off the system nothing on suspended session report. Tried all units and all the same
group A meant to balance”. Response is recorded as referred to HSD.
The HSD logs examined for the 29 July 2010 show two recorded calls made on that day. The first
at 08:27:42 it is recorded as inappropriate help desk and should not have been referred by NBSC.
The Applicant agreed to call NBSC back. The call was closed at 08:30:45.
The second later related call was made at 08:41:59, the call log was annotated inappropriate
helpdesk and the advice given is to talk to NBSC. The call was closed at 09:34:06.
18
POL-BSFF-0145762_0017
POL00307712
POL00307712
The Applicant states in her CQR that the first call to NBSC was escalated to the second line. The
NBSC call logs do not reflect this.
Whilst it is not clear exactly what advice was given to the Applicant when she sought assistance
on 29" July 2010, it is clear that the Applicant felt she was not assisted by the advice delivered.
The advice to “try logging in and out” (as referred to in Appendix 6 of the CQR although in the
CQR the Applicant also states the NBSC “provided no assistance whatsoever”) was the correct
advice. In the Applicant's i
ial complaint on page 3 the Applicant states “advised to login and out
of every terminal in the office and ensure all users are logged out”. When this advice was
followed the issue was resolved and Post Office therefore believes that the Applicant was given
adequate support.
Appendix 6 of the Applicant’s CQR refers to a visit made to the branch by a Field Change Advisor
(FCA). An FCA's role is to maintain provision of post office services at branches when issues such
as suspensions and resignations occur. They will also provide as in this instance support such as
rolling over branches when required. The Applicant claims that the FCA who attended after her
suspension had to telephone for assistance with Horizon. Records show that a FCA did attend the
branch on 26 October 2010 to ‘roll’ the branch into the current or next appropriate Trading Period
in readiness in case branch should reopen. The telephone call the Applicant refers to was to
obtain a one shot password from HSD to enable the FCA to access Horizon to perform the task he
required. This is not, therefore, evidence of a failing of Horizon.
As part of this review the temporary Subpostmaster who was in post 2 November 2011 to 30
March 2012 was asked verbally on 30 June 2014, if she had experienced any issue with “phantom”
logging on issues. The former temporary Subpostmaster stated that she had no issues or
concerns with Horizon during her period of tenure.
Conclusion on “phantom log on” issue
Post Office findings are that there were no phantom users or anyone accessing Winlaton’s
Horizon terminals remotely undertaking transactions. The User who was attached to terminal 1
was user ID KWY001 who is believed to be the Applicant and the problem arose because user ID
KWY001 failed to log off successfully on terminal 1 on 22 July 2010. Had the correct procedures
been followed and a correct log out performed on 22 July 2010 the issue which delayed the HCH
stock unit ‘rolling’ on 28/ 29 July 2010 would not have arisen.
This also counters the Applicant’s assertion that remote access was being gained to Horizon and
creating shortfalls at the branch. In any event, a failure to roll over would not cause losses.
Monthly Postage Labels Report Missing
The Applicant also states that labels produced on Horizon Terminal 4 were missing off the weekly
report for 4 weeks.
The Applicant has not supplied any evidence of this within the CQR submission. A call was made
to NBSC on 28 July 2010 at 09:30:04 (Doc 10 refers) and although the log refers to postage
stamps, it is considered that the call concerned postage labels. The log states “user is not showing
19
POL-BSFF-0145762_0018
POL00307712
POL00307712
on the office weekly report for postage stamps.” There is no response recorded other than the
knowledge base was used to provide the advice given.
It is believed that the Applicant is referring to the weekly report of postage labels which would
include rejected labels. The report is produced to enable a Subpostmaster to reconcile rejected
labels and, whilst not being able to perform this task may have been inconvenient, it could not
create any discrepancies in the branch provided no postage label fraud was taking place. The
purpose of this report and the reconciliation undertaken by the Subpostmaster is to highlight to
them any high volumes of spoilt labels being processed by their staff which could be potential
staff fraud.
If, as the Applicant suggests, this created a loss of £1,700.00 then when the items were returned
as the Applicant states then at that point a £1,700.00 surplus should have been created. In reality
this was not the situation: the report in question is only used for reconciliation purposes and
could not therefore make any difference to monetary value of stock held in branch. However it
should be also be noted that if the £1,700.00 of postage labels had not been accounted for via
Horizon as the Applicant appears to be suggesting this would have created a surplus in the branch
as the payment of the labels would have been taken at the time of the transaction.
Appendix 9 of the Applicant’s CQR refers to cash discrepancies reported by Subpostmasters being
a “significant driver” to replacing Horizon with HOL. In 2010, Post Office rolled out HOL as part of
its Horizon Next Generation programme (often referred to as HNG-X) to provide a simplified
network based on the centralised processing of data. The main changes were “behind the scenes”
along with a new “user interface” and principally affected the way each terminal communicates
transaction data to the central Post Office data centres. The programme was several years in
planning and was an improvement rather than a major change. The roll out was completed in
September 2010. This was a planned improvement and not due to reports by Subpostmasters.
Conclusions
Horizon does offer an adequate audit trail and this is supported by the fact that there is an audit
trail which has been used to respond to the “phantom log on” issue referred to by the Applicant
(as detailed above).
The issue cited by the Applicant relating to stamps could not cause a loss in the branch accounts.
Issue 4 Audit and Related Issues
The Applicant claims that:
the audit was procedurally weak and was not conducted by ‘Auditors’ but a
Subpostmaster and a Training Manager;
© the Post Office officers took the keys to her retail premises thus preventing her deriving
an income from the retail side of her business; and
Post Office assets were not properly accounted for and the Post Office personnel
20
POL-BSFF-0145762_0019
POL00307712
POL00307712
subsequent to the audit entered her premises without her permission.
The Applicant claims that the audit was procedurally weak and was not conducted by Auditors but
by a Subpostmaster and a Training Manager.
The purpose of audits undertaken is to verify Post Office assets and confirm compliance with a
range of business processes, procedures and regulatory requirements.
The audit on 10 September 2010 was conducted after the Applicant's Contracts Advisor became
aware of the Applicant having reported via NBSC a large cash discrepancy on 9 July 2010. On 29
July 2010 on completion of the trading statement (a verification of the branch accounts
completed by the Applicant or branch staff) a shortfall of £33,142.96 was transferred to FSC, the
Post Office’s accounting headquarters. The effect of this action would be to bring the branch back
into balance, however the Applicant’s personal account in FSC would hold the sum due to allow
time for the Applicant to make further investigations or for a transaction correction to be issued
to correct an error made.
On 2 September 2010 records show that an amount of £142.96 was made good by cheque. This
reduced the amount held at FSC in relation to the settled centrally amount to £33,000.00. (Doc
018 refers)
The Applicant states in her CQR that she was aware on 9 September 2010 that there was a
£2,000.00 shortfall which she intended to look for the following day. There are no records of the
shortfall being reported to NBSC on that day.
Audit Result 10 September 2010
Cash 4835.76(-)
Cheques on hand 26.00 (-)
Stock 365.08 (-)
Postage 70.99 (+)
Foreign Currency 279.08(-)
Shortfall held at FSC 33,000.00 (-)
Total 38434,93 (-)
For the purposes of the audit report, the postage stamp surplus of £70.99 and stock shortage of
£365.08 were netted off to £294.09(-) (Doc 015 refers)
Both auditors on the day were experienced and trained FSAs. The FSA role is referenced in factfile
included as part of this submission. Both FSAs would have received training on conducting audits,
are subject to Line Manager control and audits performed are periodically assessed under a
quality review programme and feedback given. Post Office therefore considers that they were
appropriate personnel to conduct an audit.
The FSA the Applicant refers to as being a Subpostmaster is an employee of Post Office in the
capacity of an FSA. The FSA is also a Subpostmaster, but does not operate his Post Office branch
21
POL-BSFF-0145762_0020
POL00307712
POL00307712
ona daily basis due to his employment with Post Office. It is not uncommon for Subpostmasters
to have other distinct roles in which they are employed by Post Office. The fact that one FSA was
also a Subpostmaster and the other had been a training manager previously is not relevant to
their ability to conduct the audit.
At the commencement of the audit a TC for £20.00 was received in the branch. This had been
issued by FSC via Horizon the previous day. There was a corresponding amount held in the
branch suspense account. Records show that the auditors obtained permission from the
Applicant to process the TC and redeem the £20.00 from the suspense account. By redeeming the
corresponding amount no cash discrepancy would be generated. (Docs 001 and 026 refers)
Apart from these issues the Applicant does not explain her term ‘procedurally weak’ so Post
Office is unable to comment further other than to say that all audits undertaken by Post Office
follow strict external guidelines and are themselves subject to periodic external audits.
The Applicant states that the Post Office officers took the keys to her retail premises thus
preventing her deriving an income from the retail side of the business.
Post Office branch keys are retained as part of the audit process when Post Office assets are left
onsite. As part of this review the auditor who retained the keys on the day was contacted on the
8 and 9 June 2014. It has been confirmed that the retail keys were retained. The auditor on the
day asked the Applicant if she required the retail keys. The Applicant replied that as most
customers only came into the shop to use the Post Office, there was no point in her opening up
the retail and therefore did not require the keys. Hence the retail and Post Office keys were kept
together.
The Applicant claims that Post Office assets were not properly accounted for and that Post Office
personnel subsequent to the audit entered her premises without her permission.
Whilst conducting the audit on 10 September 2010, a cash remittance for the branch was
delivered. The remittance was accepted and signed for by members of the audit team. As this
cash did not form part of the audit findings for that day it was secured in the safe. On completion
of the audit the auditors secured the cash in the safe but did not enter it on Horizon.
Arrangements were made, subsequently, to return to the office to accept the cash into Horizon to
maintain cash management records as the branch had not reopened with a Temporary
Subpostmaster.
The auditors did return to the branch the following Monday to record the remittance received
during the audit into Horizon. This avoided a surplus being declared or the cash needing to be
remitted at the next balance. Had the auditors not taken this action then a transaction correction
would have been issued to correct the error made which would have brought the balance back
into surplus (and have had no impact on the Applicant). However, Post Office does recognise
that the premises should not have been accessed without the authorisation of the Applicant.
The Applicant stated during her RTU that the audit shortfall revealed on 10 September 2010 could
relate to an outward remittance doubling when scanned. Records show that on 9 September
2010 an outward remittance was prepared for £4,110.00. If Horizon had doubled this amount
22
POL-BSFF-0145762_0021
POL00307712
POL00307712
and only £2,000.00 was intended to be despatched then this would have created a surplus not a
shortfall as the Applicant claims. Horizon would deduct the remittance value of £4,110.00 from
the cash on hand total assuming it was sent and therefore require £2,000.00 less to balance the
branch. (i.e. half the amount). This would then generate a TC from FSC which on acceptance
would bring the branch back into balance. (Doc 026 refers). There was no TC issued relating to this
issue.
In any event, the Applicant was present during the audit and checked the auditors’ figures (Doc
001 refers).
Conclusion
Post Office's view is that the audit was properly conducted by experienced and trained FSAs.
Further it should be noted that the Applicant checked and agreed with the auditors' figures on the
day.
Issue 5 Flawed Investigative Process
The Applicant claims that the investigative process conducted by Post Office was flawed. The
Applicant claims that there were issues with the summary termination by Post Office of the
Applicant’s contract for services and costs and losses that have flowed from this.
The Applicant was suspended on 10 September 2010 following the audit which revealed a
shortfall of £38,434.93. A letter was sent to the Applicant on the day to advise of the
precautionary suspension and indicating that agreement had been given for the use of the
premises to provide service for customers. This was to be provided by a temporary
Subpostmaster if one could be sourced.
There were two separate processes: a conduct investigation and a security investigation and these
are dealt with under separate headings.
Conduct investigation
The Applicant was invited to a meeting to provide her with an opportunity to present reasons why
her contract for services should not be terminated, (as described above this is known as an RTU)
by letter on 20 September 2010.
The RTU was held on 14 October 2010 (Doc 4 refers). The meeting was held at Durham Crown
Office and present were the Contracts Advisor, the Applicant and a representative from the
National Federation of Subpostmasters. (NFSP). The Applicant had a full opportunity to state her
case at that meeting.
At point 55 in the CQR the Applicant states that she found the support and guidance offered by
the NFSP unhelpful and negative. As an external body Post Office is unable to comment on the
actions of the NFSP or its representatives.
At the interview the Applicant agreed (page 3 point 30) that the Contracts Advisor had
precautionary suspended her by telephone on the day of the audit. This is contrary to the claim
23
POL-BSFF-0145762_0022
POL00307712
POL00307712
made by the Applicant in her CQR (page 13 point 120) that she was notified of her suspension by
the Auditor.
A letter was sent to the Applicant on 21 October 2010 stating that, after full consideration, the
decision was to summarily terminate the Applicant’s contract for services with effect from 21
October 2010. The rationale was that the Applicant had failed to manage the branch to the
satisfaction of the Post Office resulting in an unexplained shortage identified at audit of £5,434.93
in addition to an unexplained shortage of £33,000.00 which had previously been settled centrally
making a total shortage of £38,434.93.
The Applicant's CQR does not set out what further investigation she believes Post Office should
have undertaken in this stage of the process.
The Applicant notified Post Office that she wished to appeal in a letter dated 25 October 2010 and
an appeal hearing was arranged for 30 November 2010.
The appeal hearing took place after a slight delay on 7 December 2010. It was conducted by an
Appeals Manager who was experienced (having conducted appeals for over 13 years) and
therefore competent to perform that role. The meeting was concluded and subsequently the
Appeals Manager endeavoured to locate some documents that the Applicant had requested. In
particular balance snapshots for 30 June, 1 and 2 July 2010. After a search, a letter was sent to the
Applicant stating that all reasonable efforts had been made to locate the requested paperwork
and therefore to proceed on the basis that they were not available. The letter further requested
that the Applicant provided a written submission which could be treated as an addendum to the
appeal hearing of the 7 December 2010. The addendum should explain how the information
regarding the three days' data that Post Office could not supply would have added to the
Applicant’s appeal.
Following the Applicant’s precautionary suspension on 10 September 2010, the Applicant was
provided with available paperwork to enable her to perform the checks that she wished to
complete. It is regretted that some of the paperwork requested namely balance snap shots for 30
June, 1 and 2 July 2010, could not be located despite checks being made.
However, it should be noted that event logs available for the 30 June, 1 and 2 July 2010 indicate
that no balance snapshots were produced in branch for the AA stock unit on 30 June, 1 or 2 July
2010. (Doc 016 refers ) Records do show that balance snapshots were produced on 30 June 2010
for stock units CAC, ATMx3, JAN and HCH. On 1 July 2010 balance snapshots were produced for
stock units CAC, HCH and ATM and on 2 July 2010 for CAC, ATMx2, JAN and HCH. It is unclear
from the CQR exactly which balance snapshots the Applicant required but, given the discrepancy
was reported to have originated in stock unit AA, then the likelihood is that the snapshots of most
interest to the Applicant would have been for that unit. However events logs show that they did
not exist (Doc 016 refers).
Awritten statement dated 25 February 2011 was received from the Applicant, which was taken
into account by the Appeals Manager.
24
POL-BSFF-0145762_0023
POL00307712
POL00307712
Subsequently the Appeals Manager wrote to the Applicant and advised that the appeal had been
rejected. The Appeals Manager outlined that he had focused on the losses in the branch which
were significant and the transfer of ATM cash to a stock unit without following correct accounting
procedures. The conclusion was that the “failure to manage Winlaton Post Office branch to the
satisfaction of Post Office Ltd led to an unexplained shortage of £5,434.93 and an unexplained
shortage settled centrally of £33,000.00 in total £38,434.93.This being in accordance with section
1 paragraph 5 and section 12 paragraph 5”. (CQR Appendix 8 refers)
It is Post Office’s view that the appeal hearing was properly conducted and the decision to reject
the appeal was independent and unbiased.
Security investigation
Separately, a security investigation was also conducted following the audit on 10 September 2010
with a view to considering whether there was any suspicion of criminal conduct on the Applicant's
part.
An interview was arranged for 7 October 2010 but the Applicant requested that this was
postponed whilst she took legal advice.
A visit was made to the branch by two security managers on 12 October 2010 with the Applicant
in attendance to remove required documents from the branch. These included branch trading
statements, Horizon reports including final balances and cash declaration.
The Applicant was subsequently contacted several times in an attempt to arrange an interview
date. Point 162 in the CQR states that the Applicant was advised by telephone on 13 January
2011 by the security manager that there was “pressure on him from London to push the case
forward”. As part of this review the experienced security manager was contacted by telephone
on 30 June 2014. Although he cannot recall the specific conversation with the Applicant he stated
that it was very likely that he did inform the Applicant that the case should be progressed but that.
he would not have been under any pressure from London or anywhere else to progress the case.
It is important that interviews are conducted as soon as practical after an event so that any
information supplied and events recalled are as fresh in the memory as possible. The telephone
call was made four months after the audit at the branch, which led to the precautionary
suspension of the Applicant and six months after the discrepancy of £33,142.96 was first declared,
thus the security manager in the interest of being fair to all parties would have been keen to
conduct the interview as swiftly as possible.
On 30 March 2011 security managers conducted a taped and under caution interview with the
Applicant. The interview was conducted under the terms of the Police and Criminal Evidence Act
1984 and a copy of the code was provided and the Applicant was advised that she was entitled to
read it. The right to legal representation and the right to speak to a Solicitor were explained and
recorded. (Docs 023-025 refer)
In addition to the security managers and the Applicant, also present during the interview was the
Applicant’s Solicitor.
25
POL-BSFF-0145762_0024
POL00307712
POL00307712
The security managers who interviewed the Applicant had 6 and 10 years' experience respectively
of carrying out security investigations and Post Office therefore believes they had sufficient
experience and were competent to perform their roles.
The Applicant stated that she had no knowledge of how the losses occurred and believed a
mistake would be found. At the end of June the Applicant confirmed that she received a letter
advising her of her migration date to HOL. The Applicant could not recall if the letter advised her
that as part of the migration process a cash check would be performed but she stated that she
was aware the check would be undertaken. The Applicant also stated that she was aware that she
was liable for losses. The Applicant denied theft and false accounting and cast doubt on the
integrity of Horizon blaming it for the error. She said she thought the shortage could be in the £1
coins because she had received a lot of these. As she had to go out on the evening of the shortage
she decided to declare what she thought was there and, because she thought she knew where the
problem was; she would come in early the next morning to double check it. That was on the 9"°
September; the day before the audit and so, on the day of the audit she had not had the
opportunity to check the figures for error. As for the ATM stock unit shortage, she said was short
of notes in the office and so had taken notes from the ATM to use across the counter. The
Applicant denied having reintroduced cash during the HOL migration process.
During the course of her interview the Applicant was asked to provide details of all of her bank
accounts and to permit investigators access thereto. Subsequent inquiries revealed that she failed
to identify all of her accounts.
Following the Security Investigation the Applicant was charged with two offences of theft. She
appeared before the Newcastle Magistrates Court on 12" June 2012. The Applicant then
proceeded through the criminal justice system, appearing at the Newcastle Crown Court on the
19" September 2012. Trials were fixed for the 17° December 2012, 4** March 2013, both of which
were postponed for reasons of disclosure and relating to HOL.
In June 2010 the Applicant received a letter from POL informing her that the office was shortly to
be migrated to HOL. On the 9" July 2010 and prior to migration, the Applicant reported a
substantial shortage in TP 4. On the date appointed of migration the HOL Advisor attended to
confirm the cash on hand figure with the previous evening’s balance. He reported that, whilst he
was physically counting the cash the Applicant reintroduced cash he had already counted in the
hope that he would inadvertently ‘double-count’ the re-introduced cash. On 10‘ September 2010
an audit was conducted; this revealed a further deficit which the Applicant explaining that she
“...must have declared the wrong figures.”
A perusal of the NSBC logs going back to 2011 and dealing with calls from the Winlaton Post Office
reveals that calls relating to Horizon defects only appear after receipt of the Horizon migration
letter. Thereafter such calls became increasingly common.
Other Action relating to branch following suspension
Following the Applicant’s precautionary suspension on 10 September 2010 Post Office attempted
to appoint a temporary Subpostmaster. The Applicant agreed to the use of her premises to
26
POL-BSFF-0145762_0025
POL00307712
POL00307712
operate the service. The terms for the use of the premises are a matter between the temporary
and the suspended Subpostmaster. Difficulties in reaching an agreement over rent and utility
payments delayed the branch reopening. The delay resulted in the branch being defunded (cash
and stock removed) on 24 September 2010. On 2 November 2010 a temporary Subpostmaster
was appointed and the branch reopened. (Docs 006, 021 and 022 refer)
The Applicant submitted a letter dated 11 February 2012 to the National Consultation team as she
was unhappy with the Post Office’s plan which was under consultation at that time to move the
Post Office to the Spar Shop and that she had not been advised. (Doc 028 refers )
When a Subpostmaster's contract is terminated they are asked to indicate their intentions
regarding the premises they occupy. In this case the Applicant failed to respond to that letter.
Consequently the Post Office advertised the vacancy for a Subpostmaster on a ‘near’ i.e. within
reasonable distance of the current site. It is acknowledged by Post Office that the Applicant had
made her premises available to a temporary Subpostmaster to maintain customer service. Had
the Applicant indicated that the premises were on the market then it would have advertised the
vacancy ‘at or near’. Thus her failure to notify Post Office that the premises were up for sale led
to Post Office exploring other sites. It is acknowledged that the Applicant did state at her RTU
interview that the branch had been up for sale for two years.
It is usual practice to notify a Subpostmaster whose contract has been terminated when a new
Subpostmaster had been appointed. Records show that attempts were made to contact the
Applicant but Post Office was unable to do so prior to the consultation process commencing. (Doc
019 refers).
Conclusion
There is no evidence that any investigation process conducted was flawed. Whilst it is regrettable
that not all the documents the Applicant requested could be made available to her, Post Office
does not consider the missing documents to be of material importance. Additionally, it is possible
that the reason the documents in question could not be obtained is that the Applicant had not
created them in the first place.
Transaction logs were shown to the Applicant at her security investigation detailing transactions
undertaken and there were no transactions for the value of £30,000.00 so if the loss had related
to errors made it would have had to be multiple transactions involved. There were no significant
transaction corrections received as would have been expected if genuine errors had been made.
The Applicant had access to transaction logs in branch for 42 days and therefore would have been
able to check for issues at the time of the alleged shortfall of £33,000.00.
Overall, Post Office considers that the Applicant was provided with sufficient opportunity and
relevant documents to state her case and it is also relevant to note that she had legal
representation during the security investigation. Post Office believes its procedures were fair and
adequate. (Doc 030 refers)
Additional Issues/Findings
27
POL-BSFF-0145762_0026
POL00307712
POL00307712
Disparities
The Applicant gave different explanations in relation to the audit shortage at various stages:
e Inthe RTU interview the Applicant stated (page 11, Doc 4) that the shortage could be
related to £1 coins or a remittance out that the Applicant has completed or something
within “the system”.
© Onthe day of the audit the Applicant advised the auditors that the discrepancy was due
to her declaring the wrong figures.
@ The Applicant also stated during the RTU that the ATM stock unit shortage of £2,600.00
was due to her taking cash from the ATM to serve customers as the branch was running
low on cash prior to the expected cash delivery the following day but that she failed to
account for the transfer via Horizon. If this had occurred then the Applicant is quite
correct that the ATM stock unit would reveal a £2,600.00 shortage when subject to
physical check (cash declared as on hand but transferred to the AA stock unit). However
when the AA stock unit was subject to physical check this stock unit would be £2,600.00 in
surplus (cash physically on hand but not transferred). This was not the case when the
audit was conducted on 10 September 2010.
Examination of the audit papers completed on 10 September 2010 indicate that in
addition to the ATM stock unit at the audit there were £5,855.00 of notes on hand in the
branch, this would suggest that there was no need to transfer any cash from the ATM as
the Applicant cites. During the security interview (tape 1 Doc 023) the Applicant stated
that she had created a ZZZ stock unit for use when completing the trading statement
balance. She said this stock unit was to hold the final loss or gain in the branch prior to
settlement. This stock unit would not usually have held any cash or stock. To perform its
functions this stock unit must be the last unit to be ‘rolled’ when the trading statement
balance is performed. This is common practice in a branch of this size. On the 28 July
2014 the ZZZ stock unit was ‘rolled’ at 08:28:15 whilst stock unit HCH was not ‘rolled’ until
the following day. The Applicant stated at security interview (tape 2 Doc 024) that she did
not perform spot checks in the staff stock units unless there was a loss reported, as “you
have to have some trust”. However in the RTU interview page 18 point 347 the Applicant
stated that she did these on a weekly basis. In the Applicant’s CQR point 67 the Applicant
further states that she did surprise checks
Financial Position
The Applicant stated during her security interview (Tape 1 Doc 023) that she was experiencing
some financial difficulties. The credit cards held by the Applicant had reached their limits,
borrowing £15,000.00 cash on them and making reduced payments on them. The Applicant was
also being supported financially by her partner and her parents. The Applicant also confirmed
that her parents had been providing financial support over a number of years with several
thousands of pounds.
The Temporary Subpostmaster stated that on appointment there were posters in the branch
advising customers that they could only withdraw certain amounts of cash and that the assistants
28
POL-BSFF-0145762_0027
POL00307712
POL00307712
were not allowed to declare their own cash. Additionally, the Applicant's staff informed the
Temporary Subpostmaster that the Applicant would regularly borrow cash from the ATM to top
up the counter positions.
The Applicant should not have needed to use ATM cash to provide additional funds to operate her
branch. Cash holdings are monitored using the cash declarations made by the branch to
determine how much cash is required on a week to week basis. Should the need arise due to an
unexpected occurrence (i.e. a branch in the area closing due to unforeseen circumstances) then a
special cash delivery could have been requested. The fact that the Applicant was required to
access the ATM cash to service the branch suggests that the cash on hand was not being
accurately declared.
Additional Findings
In her CQR (page 4 and 5) the Applicant refers to dates to be noted in respect of terminal 4: 6
October 2010, 24 November 2010 and 14 January 2011. As part of this review Post Office
contacted the Temporary Subpostmaster who operated the branch after the Applicant’s tenure
and the Temporary Subpostmaster advised that there were no issues with any of the Horizon
terminals whilst she operated the branch (whilst terminal 4 was replaced as stated above the
Temporary Subpostmaster did not recall this and may not have seen it has a Horizon issue).
Points raised in CQR not already addressed above.
Point 18
The Applicant states that she was not advised to seek legal advice at her interview with Post
Office.
Post Office is not obliged to provide such advice to prospective Subpostmasters.
Point 36
The Applicant states that there was no training delivered on the settle centrally function.
Whilst Post Office does not have records of the exact training provided, the settle centrally
function would be explained as part of the standard training package. As part of the training
package, hand outs are left with Subpostmasters including a balancing guide. A step by step work
aid to take the Subpostmaster though the balancing process. The following is an extract from the
current hand-out and one very similar would have been supplied to the Applicant during the
classroom course. The on-site trainer would use the hand-out to coach the Applicant through the
balancing process.
At the End of Trading Period the discrepancy settlement screen appears on the last stock to Roll
Over into next TP. Horizon will ask how you are going to settle the discrepancy, i.e. Cash, Cheque
or provide you with an option to settle the discrepancy centrally if over £150. If this option is
selected, then you will receive a statement from our accounting team in Chesterfield which
provides you with the additional option of paying by credit or debit card. If the discrepancy is due
to a known specific error made at the branch, then contact NBSC with the details to enable further
29
POL-BSFF-0145762_0028
POL00307712
POL00307712
accounting investigations to be made and appropriate accounting corrections to be issued.
You do not need to ‘make good’ after each weekly balance, but you MUST make good at the end
of your Trading Period.
Point 38
The Applicant states that the Contract Advisor only became known to her personally once Post
Office decided to take issue with her.
The Contract Advisor’s role is to deal with contractual matters and as such it does not involve
regular contact with or visits to any branch. The appointment of new Subpostmasters i.e.
Interviews and conducting interviews after precautionary suspension (RTU’s) are their primary
responsibilities. The contact point for branches experiencing balancing, procedural and
transactional issues would be the NBSC. It is not normal practice for a Subpostmaster to have
contact details for Contract Advisors as they would not routinely require them. There are no
records of the Applicant attempting to make contact with her Contract Advisor prior to 10
September 2010.
The Applicant did have the support of a retail line manager (RLM) whose primary function was to
promote sales within the branch but would have been a contact point for many issues. There is
evidence that the Applicant did have contact with her RLM as NBSC logs show requests made for
the RLM to contact the branch. Whilst records do not give specific information about the reason
for the contact request, there are indications that matters such as late arrival of the branch's cash
delivery were raised.(Doc 010 refers)
Points 44,76 and 77
Point 44 of the Applicant’s CQR states that she followed the instruction on the screen and settled
the £33,142.96 loss centrally (to FSC) on 29 July 2010 and heard nothing more until the audit on
the 10 September 2010. Contained within the CQR at appendix 3 is a request for payment
statement from Post Office dated 2 August 2010, which details the loss transferred and requests
payment be made by 12 August 2010. The Applicant responded to this letter on 5 August 2010
(appendix 4). At appendix 13 there is a further request for payment issued by Post Office dated
24 August 2010. In addition, appendix 13 contains a letter from the Applicant related to the loss
dated 1 September 2010 requesting more time to investigate. Therefore the assertion that the
Applicant heard nothing further about the loss settled centrally until the audit which led to her
suspension is not correct.
The Applicant also refers to these documents on page 9 Point 76 of her CQR where she refers
incorrectly to the request for payment as a “transaction error correction”. Transaction corrections
are issued electronically via Horizon so the Applicant is mistaken with this title. The Applicant
refers to being shocked by the receipt of this document, however the amount relates to the
shortfall that she settled centrally on the 29 July 2010 which was four days prior to the date of
the request for payment. Further the Applicant stated at her RTU interview on 14 October 2010
following correspondence she received from FSC they were “actually quite helpful with me”.
30
POL-BSFF-0145762_0029
POL00307712
POL00307712
Post Office's view is that the documentation was suitable and there is no indication that the
Applicant did not understand the documentation sent in either her letters of 5 August 2010 or 1
September 2010 which were in response to requests for payment of the outstanding sum due
made by FSC.
Point 54
The Applicant states in her CQR point 54 that NBSC was limited in its support, particularly after it
reduced its operating hours from 9pm to 6pm. As part of this review the NBSC Relationship
Manager stated that NBSC since introduction in 1999 has always closed daily at 6pm with the
exception of Wednesday when it originally closed at 10.00pm but, after the introduction of
branch trading which meant that not all branches were balancing every week and the consequent
lower call demand, the decision was taken to close at 8pm on Wednesday.
Transaction and event logs were examined from June 2010 to September 2010.
In June 2010 there were no occasions when Horizon is accessed by the Applicant outside NBSC
opening times.
In July 2010 there were six occasions when Horizon is accessed by the Applicant outside NBSC
opening times. 5 July, 6 July, 8 July, 19 July, 22 July and 26 July. The NBSC call logs were examined
to establish if any calls were made the following morning on any of these dates. Three calls were
made: 6 July at 10:46:15 9 July at 13:21:05 and 23 July at 13:18:28. That these calls were not
made early the following morning would suggest that they would most likely have not been made
the previous evening had NBSC been open to receive the call.
In August 2010 there was one occasion when Horizon was accessed by the Applicant outside NBSC
opening times on 2 August. There were no calls made to NBSC on 3 August 2010.
In September 2010 there was one occasion when Horizon was accessed by the Applicant outside
of normal NBSC opening hours on 2 September. There was one call recorded the following day at
11:36:13.
Point 64 The Applicant states that she “often ended up staying until 8pm or later to check
everything with a slow computer”.
Examination of the transaction and event logs for the period June —-September 2010 have been
examined. The latest time at which Horizon is accessed during each month of the period
examined is listed below.
Month Time Time with BST adjustment
June 10 18:21:47 19:21:47
July 10 18:14:17 19:14:17
August 10 17:34:38 18:34:38
September 10 17:18:27 18:18:27
31
POL-BSFF-0145762_0030
POL00307712
POL00307712
Whilst this is only a 3 month sample it does cover the period of transition to HOL when it would
be expected that balancing would take a little longer due to the unfamiliar process. Post Office
suggests therefore that this sample period does reflect the normal balancing practices and there
is no evidence of the Applicant staying at the branch until 8pm as she cites. However Post Office is
unable to determine how soon the Applicant left the branch after Horizon was last accessed.
Points 69 and 72
At point 69 the Applicant states that the £33,142.96 shortfall first appeared around early July,
possibly the first or second. No cash variance checks were performed on the AA stock unit on
either 1 or 2 July 2010 although cash was declared by User ID KWY003 on both days. A cash
variance of £43,690.20 (-) was declared on 3 July 2010 by User ID KWY001 on the AA stock unit.
At point 72 of the CQR the Applicant states that she immediately called NBSC. Records show that
the first call recorded at NBSC related to this issue as on 6 July 2010 by the Applicant at 09:46:15.
In June 2010 only two cash variance checks were performed in the AA stock unit, on 23 June 2010
the variance check revealed a shortfall of £1,251.47 and on 24 June 2010 a surplus of £1,080.00
was reported.
Point 78
The Applicant states that she contacted FSC and was advised that FSC would look into the
reported £33,000.00 shortfall.
At the Applicant’s request FSC allowed additional time for the Applicant to make further checks,
however the onus is on the Subpostmaster to perform checks in branch not FSC, as accounting
records are retained in the branch. Post Office has mechanisms in place via its settlement process
with clients to check documentation submitted by the branch. Had any errors been located a
transaction correction would have been issued to the branch to correct the error made. Post
Office can confirm that TCs were not issued or were not due to be issued.
Point 82
The Applicant states that no auditors came to the branch after the reported shortfall of
£33,142.96.
It would not be considered necessary for auditors to attend the branch. However, the later audit
was prompted by Post Office becoming aware of this shortfall. The £33,142.96 discrepancy
became known to the Applicant by 3 July 2010. The audit of the branch took place on 10
September 2010 this allowed the Applicant over two months to investigate the discrepancy
outstanding.
Point 87
The Applicant states she initially had misgivings about HOL because it all ran from one 4-plug
extension which included the modem for the online system. The HOL migration process did not
involve any major installation works within the branch. Post Office does not consider this relevant
as any power failure would have resulted in Horizon becoming non-operational and this is not
32
POL-BSFF-0145762_0031
POL00307712
POL00307712
logged. (see point 88 below)
Point 88
The Applicant further asserts that “if the extension were to fuse, I would image there would have
been terminal problems”. There is no evidence in any call logs examined that the four way gang
extension ever fused. It is noted that the Applicant makes use of the word ‘if’ and therefore Post
Office do not believe it has any relevance or bearing on this complaint.
Point 116
The Applicant states that the last "standard retail audit" at the branch was in March 2004 and
there had been an interval of 6 years between audits until the audit in September 2010. The audit
on 10 September 2010 was as a result of the discrepancy settled centrally on 29 July 2010 and
followed on from suspicions raised by the migration officer following his visits on 21 and 22 July
2010. (Doc 020 refers) There was no standard time elapse between audits in order to maintain
the element of surprise required for a snap check.
Point 117
The Applicant questions why the branch had gone six years without an audit. This is not an
unduly long period of time.
Point 119
The Applicant asserts that on the day of the audit, one of the audit team referred to a problem
with Horizon. As part of this review the experienced FSA who conducted the audit has been
contacted and does not recall making the statement. She also states that she does not believe
that she would have made a statement to this effect. The FSA who delivers training as well as
conducting audits is fully conversant with the workings of Horizon and has no issues whatsoever
with operating the system.
Point 164
The Applicant requests all transaction and event data for 30 June 2010, 1 and 2 July 2010.
Transaction and event logs for the period requested are included with this review (Doc 16 refers).
Point 169
Transaction data is transmitted from branch terminals to central Post Office data centres where it
is securely stored using digital tamper seals. Although Post Office can access this data (which is
not unusual as Post Office has an obvious need to be able to review transaction data at a branch
level) it cannot edit this data.
Where Post Office needs to correct an error in branch, this is done by way of a transaction
correction. The effect of the transaction correction is to send another transaction into the branch
accounts, not to edit previous transaction data. The transaction correction is notified to the
branch through Horizon and must be accepted by the branch before it has any effect on the
33
POL-BSFF-0145762_0032
POL00307712
POL00307712
branch's overall accounting position. Having reviewed the data for this branch, Post Office
concludes that the “phantom log on” cited by the Applicant was in fact due to the Applicant
already being logged on to Horizon as explained above
List documents (if any)
M056_POL_001_Extra Audit Report_JB
Extra Audit Report dated 10 September 2010
M056_POL_002_Confirmation of
suspension_JB
Confirmation of suspension letter dated 10
September 2010
M056_POL_003_Invite to RTU_JB
Letter of invitation to RTU dated 20 September
2010
M056_POL_004_RTU interview notes_JB
Interview notes from RTU of 14 October 2010
MO056_POL_005_Decision Letter_JB
Decision Letter to Applicant dated 21 October
2010
M056_POL_006_Premises available_JB
Letter re availability of premises 22 October
2010
M056_POL_007_Appeal request from
Applicant_JB
Letter from Applicant to request appeal 25
October 2010
M056_POL_008_Letter of acknowledgment re
appeal_JB
Letter to Applicant acknowledging request for
appeal
M056_POL_009_Notification of appeal date_JB
Letter to Applicant re date of appeal 17
November 2011
M056_POL_010_NBSC call logs_JB
NBSC call logs 8 February 2003-10 September
2010
M056_POL_011_NBSC call log analysis_JB
NBSC call log analysis
MO056_POL_012_Transaction Corrections_JB
Transaction corrections issued 3 November
2005-19 March 2013 (to include subsequent
Subpostmasters)
34
POL-BSFF-0145762_0033
POL00307712
POL00307712
M056_POL_013_HSD Logs_JB
HSD logs 12 September 2007 to 20 June 2010
M056_POL_014_HSD analysis_JB
HSD log analysis
M056_POL_015_Audit Report_JB
Audit Report from 10 September 2010
M056_POL_016_Transaction and Event Logs_JB
Transaction and Event Logs June September
2010
M056_POL_017_Balancing Records_JB
Balancing records 30 July 2009 to 10 September
2010
MO56_POL_018_Customer Account _JB
Customer Account
M056_POL_019_Email change re premises_JB
Email change re premises
M056_POL_020_Migration officer letter_JB
Migration officer letter
M056_POL_021_Temporary Subpostmaster_JB
Email re problems to secure a Temporary
Subpostmaster
M056_POL_022_Defund Notification_JB
Email chain re branch defund following
Applicant's suspension
MO056_POL_023_Tape 1_JB
Record of taped interview 1 30 March 2011
M056_POL_024_Tape2_JB
Record of taped interview 2 30 March 2011
MO056_POL_025_Tape 3_JB
Record of taped interview 3 30 March 2011
M056_POL_026_Explanation of terms_JB
Explanation of terms used in report
M056_POL_027_Training Records_JB
Record of on-site training
M056_POL_028 Applicants letter 11022012_JB
Letter from Applicant re transfer of branch
M056_POL_029_Appeal Notes_JB
Notes of Appeal Hearing on 7 December 2010.
M056_POL_030_Appeals Manager letter to
Applicant_JB
Letter to Applicant to confirm paperwork
supplied.
35
POL-BSFF-0145762_0034