LCAS0000113 - Second witness statement of John Jones in HQ05X02706

Evidence on official site

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Filed on behalf of the: Claimant/Part 20 Defendant
Witness: John Howard Jones

Statement: 2

Exhibits: JHJ2

Date made: 06/10/06

IN THE HIGH COURT OF JUSTICE Claim No: HQO05X02706
QUEENS BENCH DIVISION
BETWEEN:-

POST OFFICE LIMITED
Claimant/Part 20 Defendant
-and-

LEE CASTLETON
Defendant/Part 20 Claimant

SECOND WITNESS STATEMENT OF JOHN HOWARD JONES

I, JOHN HOWARD JONES of Network Change, Post Office Limited, Sales and Service,
Upper Floors, The Markets DMB, 6/16 York Street, Leeds, LS2 7DZ WILL SAY AS
FOLLOWS:-

1. I am currently an Area Development Manager for the Post Office Limited (“the Post
Office”) and am also an Appeals Manager, with responsibility for hearing both agents
and employee appeals as part of Post Office’s independent Appeals Panel. I have
worked for the Post Office for 24 years and have been an Appeals Manager for the past
3 years.

2. I make this Witness Statement from facts within my own knowledge unless otherwise
stated. References to page numbers in this Witness Statement are to page numbers of
exhibit JHJ2 to this Witness Statement.

Background

3. Between 18 July 2003 and 23 March 2004, Mr Castleton, was the subpostmaster at the
branch of the Post Office at 14 South Marine Drive, Bridlington, YO15 3DB (the
Marine Drive branch). In that role, he was responsible for making good all losses,
whether caused through his own negligence or that of his assistants.

4. I understand that on or about 23 March 2004, Mr Castleton’s contract for services was
suspended because of large unexplained losses that had been reported occurring over
the preceding 12 weeks. An audit took place at the Marine Drive branch on 23 March
2004 which concluded that there were unauthorised losses at that stage of
£25,758.75. This was followed by a full investigation, during which time Mr Castleton

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was interviewed by Ms Catherine Oglesby, the Retail Line Manager (RLM) who was
dealing with the matter at that stage. On 17 May 2004, Mr Castleton was dismissed
and the dismissal was effective from 23 March 2004 (the date of his suspension). I
was responsible for dealing with Mr Castleton’s appeal against the dismissal. The
appeal was effectively a re-hearing of the entire case.

5. I wrote to Mr Castleton on 21 June 2004 to confirm that I had scheduled the appeal
hearing to take place on 1 July 2004 (pages 6 to 7).

of

Pre-Appeal Enquiries

6. Before hearing the appeal, I firstly obtained the Agent Case Summary from Lesley
Joyce, the Contracts Manager. (pages ‘4 ‘to 5). This set out the name of the
subpostmaster, address of the branch and brief details of the case.

7. I then made enquiries with Cheryl Woodward of the Post Office’s Transaction
Processing Section to check on the volume of error notices recorded prior to the losses
that occurred between weeks 42 and 51. I also checked the level of error notices that
had been received since the suspension on 23 March 2004. An error notice is a
correction statement. It is generated if the paperwork that is produced by the branch
for a transaction (for example, pension counterfoil, girobank slip or cheque) that is
sent off for processing does not match the information inputted by the counter clerk on
the computer, when the two streams of information are compared.

8. I noted that at that time for weeks 42 (the Cash Account week ending 14 January
2004) to 51 (the Cash Account week ending 17 March 2004), only one error notice
dated 17 March 2004 had been received for £1,256.88 for a customer called Dorothy

40), Which was charged to the Late Account. (The Late Account

is a holding account that is established following either the suspension or last day of

Constable (pages!

service of a Subpostmaster and records all previous errors that are recorded against
that branch, which have not been brought to account). I can now see from the Former
Subpostmaster Statement of Errors at page 11 that this particular error for £1,256.88
was reversed on 20 January 2005 and accordingly forms no part of this claim. Two
smaller error notices totalling £292 were also charged to the Late Account. I do not
have the dates and specific amounts for those errors totalling £292, but believe that
they actually occurred whilst Mr Castleton was the postmaster but had not been drawn
to the attention of the business until after he was suspended. As such Mr Castleton
was liable for the errors which occurred during his period of appointment.

I personally analysed each line of the Marine Drive branch Cash Accounts for the 17
weeks between 24 December 2003 and 14 April 2004 (i.e. account weeks, 39 to 03
inclusive). I examined every entry on the Cash Account over the critical period when

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10.

11.

12.

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the losses being incurred were at their greatest. The purpose of my analysis was to
check independently the arithmetical accuracy of those accounts, the average volume
and value of the transactions at the Marine Drive branch during this period, the
average cash usage, the cash ordering cycle and identifying any transactional areas
that were outside the mean average value for the bank i.e. whether there was
anything unusual for this particular branch. Basically, I was recreating the Cash
Accounts for each week, as best as I could, to ascertain whether the losses were real.

A spreadsheet showing the results of my analysis is at page 34. -\, aS

I visited the Marine Drive branch on 28 June 2004, to investigate those transactions
that I had already identified as being outside the average value for this period or which
might otherwise give rise to discrepancies. I analysed a Giro business customer's cash
deposits that were made into the branch. The customer was a car auction and made
large cash deposits each week. Each cash deposit was then cross referenced with the
entry that was recorded from the Horizon system. Each entry was recorded correctly in
line with our operating instructions and brought to account through the Horizon system
on the day the cash was deposited. I also carried out a number of further checks in
relation to the receipts available at the branch to prove that the final totals accurately
and correctly appeared in the end of week accounts. I checked a number of daily
records that were available in the branch to confirm their arithmetical correctness and
that they had been correctly recorded onto the Horizon system. Again, these were
proved to be correct.

After my visit to the Marine Drive branch, I reviewed the interview notes from 10 May
2004. On 25 June 2004, I emailed Ms Oglesby, then the Retail Line Manager, to ask
why the advice she had given to Mr Castleton to take up individual stock unit balancing
had not been followed by him and any reason as to why such losses, were consistently
dismissed by Mr Castleton as. being < A fault with the Horizon system (page 12). Ms
Oglesby replied later that day page 13). I followed my email up with a telephone
conversation with Ms Oglesby in which she said that she had advised Mr Castleton to
prepare balances every day. Ms Oglesby advised me that Mr Castleton was foath to
take her advice, dismissed any suggestion that there might be a problem that could
possibly be theft related and persisted with his belief that all shortages were as a
result of the computer system. I was surprised that Mr Castleton repeatedly dismissed
the advice of an experienced Post Office manager given that he was a relatively new
subpostmaster and significant losses were accumulating in the Marine Drive branch.

I also conducted a daily transactional analysis from both daily and weekly balance
snapshots in the cash accounts of weeks 46, A7 and, 50 in which there were losses of
£8,243.10, zero and £10,653.11 respectively abe: 35). My analysis showed that there
were anomalies between the cash contained in the balance snapshot for the Tuesday
of those weeks and the final cash declaration set out in final balance in the weekly

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Cash Account produced on the Wednesday. For example, I evaluated individual
transactions between Tuesday 10 February 2004 and Wednesday 11 February 2004 for
cash account week 46. My evaluation indicated that the actual transactional receipts
exceeded those payments that were declared by the Marine Drive Branch by
approximately £15,300. It can be demonstrated, by reference to a giro receipt, that a
cash deposit of £16,500 by the car auction (customer number 685 9461) was received
on Wednesday 11 February 2004, but this is not reflected in the Cash Account signed
by Mr Castleton at the close of business on the Wednesday. A cash declaration of
approximately £49,000 should have been made as opposed to the incorrect cash
declaration that was actually made of £33,100. In other words, my assumption at the
time was that the Marine Drive branch physically received approximately £15,300
more cash than the amount it actually declared for that week in the Cash Account. I
have no conclusive explanation for this other than that the paper records were

seriously inaccurate.

13.1 again visited the Marine Drive branch on 30 June 2004 to track the Giro Bank
business deposits that the branch received and to establish the flow of cash into the
branch. The Marine Drive branch permanently held the account book for the car
auction who regularly deposited significant volumes of cash each Wednesday. The
deposit pouch I examined from the company at my visit to the branch contained a
large amount of cash and was accompanied by a blank inpayment book and receipt
slip. I was advised by the Interim Subpostmaster that this was normal practice for the
branch to check the amount in the pouch and then complete the deposit and receipt
slip on behalf of the customer. The amount deposited was then processed without any
verification with the customer. The pouch would then be returned to the customer

with the receipt slip on their next visit to the branch.

14. I analysed all of that customer’s deposits since November 2003 to confirm that the
deposits had been brought to account. I double checked the cash account weeks of 46,
47 and 50 where I had carried out a daily transactional analysis, to establish whether
the levels of cash that had been declared had actually been received from this
customer. My analysis showed that erroneous cash declarations had been made,
because the cash usage that occurred in the weeks 46, 47 and 50 was not reflected in
the final cash declared by the Marine Drive branch upon completion of the weekly
balance. In other words, the cash that the giro receipts and balance snapshots
showed that the Marine Drive branch had physically received from this customer was
not reflected in the cash that Mr Castleton declared in the Cash Account for each of the
weeks examined. The cash physically deposited at the Marine Drive branch should
have been accounted for.

15.I made enquiries of Network Business Support Centre (NSBC) and the Horizon
Systems Helpline (HSH) and analysed the telephone records held by them to check

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what instructions had been given to Mr Castleton and also to check that the branch did
not close due to running out of cash. My enquiries revealed that tests had satisfactorily
been carried out on the Horizon system which confirmed its integrity.

The Appeal Hearing on 1 July 2004

16. Mr Castleton had been dismissed by Ms Oglesby because the Marine Drive branch had
incurred significant unexplained losses which he had not made good. Mr Castleton
blamed the Horizon computer system for these losses, but there was no evidence to
support his assertion. I presided over Mr Castleton’s Appeal Hearing on 1 July 2004.
Mr Castleton had a representative present, Mrs Julie Langham (from the Federation of
subpostmasters). Miss Paul Carmichael of the Post Office was also there to take a note
of the Hearing. U attach a typed note of the Case History and the Notes of Appeal at
NpageS 14°to 231! mr Castleton does not accept that the typed Note of the Appeal
hearing is accurate, so a copy of the handwritten note is at pices 24 to 33, ye Confirm
that so far as I am concerned, both the typed and handwritten notes are a fair

reflection of what was said.

17. During the Hearing, Mr Castleton blamed the Horizon computer system for the losses.
The Horizon System is an on-line accounting system that is integrated into over
17,000 Post Office branches which is intended to provide security and integrity for the
Post Office and our clients’ transactions. The system is like a sophisticated electronic
calculator for the Post Office. It provides for on-line reconciliation of all our customer
transactions and the Post Office weekly balance. It records all volume and values of
transactions taking place at the branch. These transactions must be physically entered
onto the system by the user when a customer presents a transaction at the Post Office

counter.

18. Each counter position has a computer terminal, a visual display unit, a keyboard,
barcode scanner and printer. This system records all transactions inputted by the
counter clerk working at that counter position. It can therefore only record what the
counter clerk types in. Each user has a unique pass word and identifier to enable the
system to have both internal and external security. Once logged on, any transactions
performed by the user must be recorded and entered on the computer. The system
reconciles the daily and weekly transactions and provides the weekly Post Office
balance. The onus is on the counter clerk to check and confirm the value of the stock
and cash that is on hand when completing the balance and accordingly is expected to
verify that the recorded transactions match the accompanying physical documents
(such as counterfoils) each day. The system also allows for information to be
transferred to the main accounting department at Chesterfield in order for accounts for
each Post Office branch to be balanced.

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19. However, Mr Castleton was unable to provide any evidence to support his assertion
that the computer system was responsible for the losses. Furthermore, neither Fujitsu
Services (who were responsible for designing, implementing and operating the Horizon
system), nor HSH had been able to identify any problems with the system. In any
event, Mr Castleton stated that the cash declarations he had made (i.e. the accuracy of
the cash that he declared onto the system and ultimately the weekly cash accounts
that he signed) were accurate “nine times out of ten”. Mr Castleton stated that he
knew how much to order based on amounts previously ordered and Chrissie’s (his
assistant) experience.

20. I had also carried out an analysis to track large bulk orders of usable cash moving in
and out of the branch to try to ascertain why the subpostmaster would order cash
outside the branch’s normal requirements. This particular analysis focused on he
period in which significant losses occurred, being cash account week 42 (the week
ending 14 January 2004) to cash account week 51 (the week ending 17 March 2004).
I was interested in Marine Drive branch’s bulk cash ordering and not their orders of
change because the orders for change were largely accounted for through giro change
orders and the small coin requirements to service every day transactions.

21. I explained to Mr Castleton that between weeks 42 and 51 inclusive the Marine Drive
branch had ordered significantly more cash from the Post Office than had normally
been the case. Mr Castleton stated that he only ordered what he felt was required. I
informed Mr Castleton that for this entire period (cash account weeks 42 to 51) the
actual cash usage for transactions at the branch did not differ from week to week and
he had only actually needed to order between £200,000 to £265,000 in cash. Instead,
Mr Castleton had £305,000 cash and of which only £20,000 usable cash was returned.

22. For clarification I should add that during that period it appears from the weekly Cash
Account that the Marine Drive branch actually ordered £316,590 and returned
£34,891.28, but this included unusable notes, foreign notes, Scottish notes and
coinage that is remitted on a weekly basis and the purpose of my analysis was to track
large bulk orders of usable cash moving in and out of the branch.

23. My analysis of the increases in cash ordered by the branch suggested that the branch
did not need to order these excessive amounts of cash, because they were not
required to serve the transactions that were being performed. Significantly, the orders
for extra cash were always in weeks where there was reported to be a significant loss
at the branch.

24. The Marine Drive branch never ran out of cash. If the Horizon system had been
incorrect and the cash shortfalls merely theoretical (i.e. computer generated), rather
than actual, there would always have been sufficient cash in the Marine Drive branch
to meet its requirements and no need to order more than £265,000 cash during weeks

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42 to 51. Crucially, it was only the ordering of the extra cash that ensured that the
branch was always able to remain trading. Mr Castleton was unable to explain why he
needed actual additional cash or where that additional cash had gone if there was only
a computer generated, theoretical shortfall.

25. If Mr Castleton’s assertion was correct, this would not have affected the physical
amount of cash at the Marine Drive branch or mean that Mr Castleton had to order and
use extra cash. Mr Castleton specifically stated that he only ordered the cash he felt
was required.

Post Appeal Hearing Enquiries

26. After the Appeal Hearing, I did a further check with Chery! Woodward of transaction
processing who confirmed that there were no other outstanding error notices in the
system.

27. At the appeal hearing, Mr Castleton requested that further analysis be conducted on
certain Horizon balance printouts. I wrote to him on 5 July 2004 to confirm that I

n would obtain the analysis and endeavour to confirm my decision on 14 July 2004
Nigagds ” 39 ‘and’ 40). Accordingly, I gave the Horizon final account declarations to the
Network Development Manager, Anita Turner, who had no previous knowledge of the
case and asked her to conduct her own independent analysis of the losses and
movements in the suspense account between cash account weeks 45 and 50. I wrote

to Mr Castleton on 8 July 2004 to confirm the result of Ms Tumer’s analysis (page 43

and 44). Her analysis showed that: MS ps

(a) For the week ending 12 February 2004 (cash account week 46), the Marine Drive
branch declared a shortage discrepancy of £8,243.10.

(b) For the week ending 19 February 2004 (cash account week 47), the Marine Drive
branch opened a suspense account and transferred the shortage discrepancy of
£8,243.10.

(c) For the week ending 26 February 2004, (cash account week 48) the Marine Drive
branch declared a shortage discrepancy of £3,509.18.

(d) For the week ending 4 March 2005 (cash account week 49), the Marine Drive

branch transferred the shortage discrepancy from week 48 of £3,509.18 to the
suspense account. The branch then declared a further shortage of £3,512.26.

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(e) For the week ending 11 March 2004, (cash account week 50) the Marine Drive
branch did not transfer the shortage discrepancy of £3,512.26 to the suspense
account, but it was instead rolled over to week 50 without being made good.

Total (for weeks 46 to 50): £15,364.54
28. In or about late June/early July 2004 and 9 July 2004, Mr Castleton wrote to me again

(pages 41 to 42 and 45 to 48). However, 1 do not recall seeing those letters at the
time, which may be because they were sent to the Darlington Area Office rather than

Calthorpe House, London where I was working at the time.
Factors affecting my decision to dismiss Mr Castleton’s Appeal

29. The decision to dismiss Mr Castleton’s appeal was not taken lightly. A list of the factors
affecting my decision are at pages 2b a and 21. 4 conducted extensive analysis on the
accounting documentation made available for the Appeal as well as the transactional
records at the Marine Drive branch. The Post Office’s Transaction Processing
Department only had three error notices, all of which were accounted for. The cash
ordered by the Marine Drive branch was significantly outside the mean average value
that it normally ordered. The cash ordered was systematically increased on four
occasions, following which a large cash discrepancy occurred.

30. The Marine Drive branch incurred unprecedented declared losses over a 12 week
period in respect of which Mr Castleton could only offer the explanation that it was the
Horizon System that was causing the errors. If the Horizon system was erroneously
declaring losses in the branch, there would have been no actual cash shortfalls and
there would always have been sufficient amounts of cash in the branch to service its
requirements without ordering extra cash. However, Mr Castleton actually ordered
extra cash (which was not returned) and it was only this extra cash which enabled the
branch to continue to trade without running out of cash. Mr Castleton was unable to
explain why he required additional cash if there was only a system error. His argument
that there was a system error was unfounded, but was in any event, academic. The
physical need for extra cash can only be explained by the fact that cash was lost.

31. My analysis of the weekly accounts show that the Marine Drive branch needed
approximately £200,000 to £265,000 to meet its transaction or requirements between
weeks 42 and 49, but had ordered £305,000 in cash to cover this period in respect of
which only £20,000 was returned. It was significant that additional cash was ordered
prior to a subsequent cash discrepancy being declared. Mr Castleton was not able to
explain why such sums of cash were ordered that were in excess of what was actually
required and where it had gone.

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32.

33.

There were not and have not since been any subsequent error notices for the branch
under Mr Castleton's operation, nor any similar experiences of large shortages by a
number of locum Subpostmasters who have all operated the same pieces of Horizon
kit, week in week out.

In the circumstances, I believed (and still believe) that the decision ultimately to
dismiss Mr Castleton was soundly based and that the arguments he advanced held no
credence whatsoever and accordingly I dismissed his Appeal. I wrote to Mr Castleton
on 9 July 2004 to confirm my decision (page 49).

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Filed on behalf of the: Claimant/Part 20 Defendant
Witness: John Howard Jones

Statement: 2

Exhibits: JHJ2

Date made: 06/10/06

Claim No: HQO5X02706
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
BETWEEN:-

POST OFFICE LIMITED
Claimant/Part 20 Defendant

-and-

LEE CASTLETON
Defendant/Part 20 Claimant

SECOND WITNESS STATEMENT OF
JOHN HOWARD JONES

BOND PEARCE LLP
Ballard House

West Hoe Road
Plymouth PL1 3AE
+44 (0)845 415 0000
DX8251 Plymouth

Ref: SJD3.348035.134

Solicitors for the Claimant/Part 20 Defendant
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Filed on behalf of the: Claimant/Part 20 Defendant
Witness: John Howard Jones

Statement: 2

Exhibits: JHI2

Date made: 06/10/06

Claim No: HQO5X02706
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
BETWEEN:

POST OFFICE LIMITED
Claimant/Part 20 Defendant

-and-
LEE CASTLETON
Defendant/Part 20 Claimant

SECOND WITNESS STATEMENT OF JOHN HOWARD JONES

This is the Exhibit marked "JHJ2” referred to in the Second Witness Statement of John

Howard Jones dated c* October 2006.
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“4

MARINE DRIVE INTERVIEW 10 MAY 04

Attendees: Mr Lee Castleton Subpostmaster
Mrs Chrissie Train Post Office assistant
Cath Oglesby RLM
Lesley J Joyce CM

Cath opened the interview by introducing everyone, explained the reasons for
the interview, the roles of those in attendance, read out the charge and said it
was LC’s opportunity to give any explanations or reasons as to why his contract
for services should not be terminated. (LC asked to tape the interview but was
informed he could not but could take notes and be copied these notes)

CO then went on to give a summary of events which led to the suspension of LC
on 23 March 04 due to an unexplained shortage of £25,758.75.

During the 12 weeks prior to audit LC had several large unexplained losses. LC
was suspended as a precautionary measure to try and investigate where the
losses were occurring. CO asked LC if he would allow his premises to be used to
conduct PO services and he agreed.

LC’s thoughts have always been that the Horizon system was to blame for the
shortages so the only thing that was changed in the office was the ‘people’. All
the current staff came out of the office and a temporary Postmaster, Ruth
Simpson, was allowed to run the branch, during the 4 weeks that RS was in place
the cash accounts showed no large losses.

The system did crash on her and was re-booted but this did not affect the
balance. She had problems with the AP card reader but was not allowed to
change the kit under the circumstances. No problems occurred while remming in
or with Lottery.

When RS finished Greg was appointed as temp Postmaster, again no problems
with balances or with any of the above.

CO Went on to discuss actions she had taken:-
Horizon-Asked for a system check twice
1-During the time of large losses—-—-everything okay

2-During RS time
3-Asked what upgrades had there been since week 39, the HSH said upgrades

happened all the time, to different offices and they were unable look at

individual offices.
4-All the events on the software system checked back to 1 March 04, no

abnormalities.

Chesterfield

1-Contacted them on a number of occasions regarding any outstanding error
notices

APS-None up to week 3

Lottery small error on prizes

Girobank
Checked all the weeks up to week 02-no issues

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LC Agreed with all of the above. He asked CO what she considered was an acceptable
amount for cash account losses.

CO Said it varied for different office’s but £20 per week was reasonable. CO
opened the discussion to LC to give reasons for the losses.

LC Said that he had not taken any money and that he trusted his staff 100% not to
have taken anything. He said that he had asked for 10 bits of information in the letter
he sent but only received 1 item. He had asked Fujitzu for help and the NBSC and no
one had got back to him, they were not prepared to help. He had spent hours each
night with CT looking at the balances. He said that a remote test would not turn up on
a software check, he understood there were a lot of problems with Horizon and the
system, he had a lot of problems at the office with re-boots etc, so why did this
happen if nothing was wrong with the system. No one would tell him what tests were
done, I don’t know what ‘clear desk top’ means. I have had a lot of e-mails from
Postmasters who have problems with Horizon.

CO Replied that she had only received his letter on the night of wed 5" May
which was only 2 working days prior to the interview and she was working on
getting him the information he requested. She had suggested several things for
him to do in the office such as individual balances and the idea that staff could be
responsible but he would not take any measures or listen to this point of view.
CO then said it would be helpful to go through the individual balances, week by
week methodically and look at the suspense accounts. CO clarified LC
understanding of how the cash account worked with regards to balances and
losses and gains. LC Confirmed he understood.

CO Then goes into detail with balances, error notices, losses etc and the evidence
she has with snapshots and declared cash. (Copies of all this information is
provided with a list of all the results of the balance)

CO Asked LC to clarify if he made the error notices good but he could not
remember. She clarified when the shortages were first put in the c/a. CO stated
that not all the information such as snapshots were provided and LC said they
were probably in the box.

CO refers LC to some of the cash declarations which have been manually altered
or written on, specifically to week 47 and the declaration on 12 Feb 04 which had
a figure of aprox £7000 written on the bottom of the cash declaration. Both LC
and CT looked but although LC said he thought it was CT writing she was not
certain. CO said this was very important as although the c/a for week 46 showed
a loss of £8243.10 the following snapshots and declared cash did not evidence
this. She explains:-

Snapshot at 17.27 on Fri 13 Feb shows you need £92095.36, cash declaration
shows you have £99128.40, a gain of £7033.44.

Sat 14 Feb shows you need £95896.59, cash declaration shows you have
£102706.10, a gain of £6809.51.

Mon 16 Feb snapshot shows you need £77958.28, cash declarations show you
have £84909.54, a gain of £6951.26

Tuesday 17 Feb snapshot shows you need £68163.08, cash declaration shows you
have £84909.54, a gain of £6776.77

HOWEVER The c/a on wed shows the cash is an exact match for the cash
required on the balance-Where has this surplus gone?

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LC Has no explanation and says it must be something to do with Horizon.

CO Goes on to give other examples where shortages in subsequent weeks do not
then match the snapshot and declaration. (Evidence provided)

CO and LC then have a long discussion about the discrepancies shown on the

snapshot and CO says she will clarify after interview.
CO asks again where the gains which are evident and which are hand written on

the cash declaration could have gone.
LC says he does not know but he has not taken the money.

CO Says that the Horizon system works as a double entry system and everything
she has looked at works through. Originally LC had said that the system was
doing something when the rems were put through but the evidence does not
shows this. She had asked LC to run a snapshot after close of business, input the
rem and then run another snapshot to see if figures were altered and asks LC if

he had done this,

LC Says that he did not have time to do this, it had been a nightmare, he feels it is a
computer problem and no-one has helped him. 5 months is a long time to try and
remember what happened and what went on. He mentions other offices that have told
him about problems with cheque listings and P&A dockets. He said that no-one had
visited from Horizon to look at his problems and balances.

CO Explained that Horizon would not attend his office due to poor balances,
they would need evidence of a problem which he was unable to provide, she also
mentioned that she had given him advice and spent hours and hours on this case
and his cash accounts. She asked LC if he could show her a figure that the
Horizon system had changed which did not make sense or could prove his

allegations.

LC Said no but he did know an office where it had changed a figure on Girobank
although the office did receive corresponding error notices.

CO asked LC to confirm he had not taken the money

LC No. He asks to see the c/a’s for weeks 1,2,3,4 which CO provides to him and says
he can have copies.

CO asks if there is anything else he wants to add.

LC says he would like the explanation on the discrepancies, which CO agrees to

provide.
CO told LC that she was still waiting for a response from Horizon regarding the

checks on the software.As soon as they were available she would let him know

the out come.
CO Ends the interview by thanking those in attendance.

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AGENT CASE SUMMARY

APPEAL AGAINST SUMMARY TERMINATION OF CONTRACT

FOR COMPLETION BY CONTRACTS MANAGER

LEE CASTLETON

1.__I Full Name of Agent
2. I Office Name & Address MARINE DRIVE,14 SOUTH MARINE
DRIVE,BRIDLINGTON,YO15 3DB __ _
Postcode YO15 3DB _I}
Telephone (STD) 10262 672025 _ -

3 I Private Address AS ABOVE
(If different from above)

Postcode
Telephone (Postline/STD)

4. I Brief Details of the Case LARGE UNEXPLAINED LOSSES AT THE
Note: If the case involves ination, OFFICE OVER A TWELVE WEEK PERIOD.PMR
harasements orany other significant fsue BLAMES THE HORIZON KIT AND SOTFWARE
conta ate authority level M PROBLEMS.NO ERRORS ON SYSTEM.NO
Employment Tribunal (ET) stage. The ET- ERROR NOTICES DUE.NO FIGURES COULD BE
Authority process should be referred toby I IDENTIFIED THAT HAD BEEN CHANGED BY
reaches the E'stage, For further information THE SYSTEM.CHECKS DONE BY HELPLINE,
on the ET process please contact Post Office I NBSC, HORIZON HELPDESK.GIROBANK,

Legal Services. POSTMASTERS RECORDS AND
CHESTERFIELD.REQUEST SENT TO FUJITSU
TO CHECK SUSPENSE ACCOUNT
SOFTWARE,AS YET NOT RECEIVED. PMR
SUSPENDED AS A PRECAUTION. HAVE HAD
THREE TEMPS IN THERE OVER THE LAST TEN
WEEKS , NO LARGE LOSSES.

5._I Details of Specific charge UNEXPLAINED LOSSES TOTALING £25758.75

6, _I Date of suspension 2380 MARCH 2004

7. I Brief summary of reasons for NO EVIDENCE TO SUPPORT PMR CLAIMS
making decision to terminate OF COMPUTER PROBLEMS.AS SOON AS THE
contract PEOPLE WERE REMOVED FROM THE OFFICE

THE LOSSES STOPPED.THE COMPUTER
EQUIPMENT HAS NOT BEEN
CHANGED.LOSSES REACHED A LARGE
AMOUNT IN A VERY SHORT SPACE OF TIME.

8. Date of decision to terminate 17 MAY 04
contract >

9. I Name & Contact No. of Retail Line I CATH OGLESBY GRO
Manager oo

10. I Name & telephone contact of LESLEY J JOYCE GRO
Contracts Manager Sr

11. I Date of submission to Appeals 7 June 2004
Allocation Duty - HRSC

12. I Name and telephone contact of N/A
Investigation officer (obtained
from investigation notes)

FOR COMPLETION BY APPEALS ALLOCATION DUTY

13. I Date received from Contract 07.06.2004

Manager

&

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14. I Appeals Manager appointed - I

date/name/location _

FOR COMPLETION BY CONTRACTS MANAGER _ _I

15. I Date Case Completed I

(i.e. date of notification to appellant of

outcome)
16. I Outcome
17. I Improvement Opportunities

Identified a ee
18._I Subsequent Action Taken I

Please ensure that all sections of this form are completed in full and
returned to the Appeals Allocation Duty as soon as possible. A copy of this

form should also be retained with the case papers.

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Personal ~ In Strictest Confidence

Mr Lee Castleton

14 South Marine Drive
Bridlington

YO15 3DB

21° June 2004

Dear Mr Castleton

I have been advised by the Contracts Manager (North East) that you wish to
appeal against the decision to summarily terminate your contract for service
as a Sub Postmaster, on the grounds of failing to run your Post Office ®
branch in accordance with your contract for services (Section 1 part 5 and

Section 12 para 12).

I will be hearing your appeal as a member of the National Appeals Panel.

I am writing to advise you that I propose to hold the appeal with you on
Thursday July 1* at the Area Office, Crown Street Darlington DL1 1AN.

I have scheduled the appeal hearing for 11.00am on the 1° July 2004.
During the interview, you may be accompanied by a friend who must be a
Subpostmaster/Subpostmistress, Sub-office Assistant, or Post Office

employee and who may be a representative of the National Federation of
Subpostmasters. Any such representation should be arranged by yourself.

The friend must not be involved in, or implicated by, the case.

Post Office Ltd
Registered in England Number: 2184540

Registered Office 80-86 Old Street

497
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London EC1V 9NN

The Post Office and the Post Office symbol are
Registered trade marks of Post Office Ltd in the
UK and other countries

Would you please confirm that the date and time are convenient for you to

attend.

If you are to be accompanied, I will need to know who will be attending with
you. This can be done by telephoning the National Business Support Centre
ol and leaving a message for myself, or by letter, using the

enciuséa addressed envelope.

Yours sincerely

John Jones
Appeals Manager
Calthorpe House
15-20 Phoenix Place
LONDON

WC1X ODG

~ I 498
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TP6
FORMER SUBPOSTMASTERS STATEMENT OF ERRORS
OFFICE NAME : SOUTH MARINE DRIVE. OFFICE CODE 2213337
DATE OF ERROR: 17/03/2004 WKIYRNo: 51/03 £ 1,256.88 ch
CASH ACCOUNT LINENo: 1103 LINE DESCRIPTION : Automated Products
CASH ACCOUNT ENTRY : £ SUPP. DOC. TOTAL : £ 1,256.88

Details of Error:

(PLEASE PROVIDE FULL WRITTEN HISTORY OF THE ERROR)

AS PER TELEPHONE CONVERSATION.

EASA ACCOUNT FOR 633625011400881587400002 FOR £1256.88

AS NOT PUT THROUGH THE AUTOMATED PAYMENTS SYSTEM ON 17/03/2004.

THEREFORE £1256.88 CHARGE OUTSTANDING.

~-REFAMB/EASAUP89/POCASE141

Please note that the previous and following weeks transactions have been checked before

issue of this error and no compensating errors were found.

NB. Attach all supporting documentation in support of the supporting document value.

FOR INTERNAL USE ONLY

Tick if manual JV required

NB A manual JV is needed when an error is
forced after the CLASS data has been archived.

Duty Holders Name : W SMITH

Duty Holders Signature

Authorised/Checked by (POA)

Error for REGION 85_ 7%

Ext:
Ext: ALO

2452

Date of authorisation : RQ -D “Oly.

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PKESMO1 CLIENT LEDGERING AND SETTLEMENT SYSTEM 28/05/04 06

SUPPORTING DOCUMENT CONTENTS PAGE 02 OI
OFFICE NO. 213337 YR/WK 03 51 LINE 0009
CURR. VALUE 11658.08 C/A VALUE 11658 .08
DOC. IN DOC. REF  REC/DESP DATE ADJUSTED AUTH IN
LINE VALUE TRAN / TYPE OFFICE BY / RSN BY
0266 373.00 27/03/04
0269 464.00 27/03/04
0304 246.10 27/03/04
0338 1256.88 EASAUP89 c141 13/05/04 CPVPB77 X  A/CPVPB7
0340 16.99 27/03/04
0400 2803.00 27/03/04
0402 200.00 27/03/04
0414 250.00 27/03/04
oF 15.00 27/03/04
05u4 600.98 27/03/04
PF7-PAGE BACK PF8-PAGE FORWARD PF3-LAST MENU CLEAR~MAIN MENU

PF2-AUTHORISE PF4-DISALLOW PF6-CONFIRM PF5==>C/A DETS. PF12==>ERROR DETS
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PKEDMO1 CLIENT LEDGERING AND SETTLEMENT SYSTEM 24/05/04 11:44
DETAIL ERROR SITUATION
~4Ck 213337 YR/WK 03 51 LINE 1103
CASH A/C SUPP. Doc. MISBALANCE CHARGE ERROR DATE
AMOUNT ADJ. AMOUNT ADJ. AMOUNT /CLAIM YY/wWw
1256.88 Y -00 1256.88 CHARGE 04/06
SUPERSEDED MAINTAINED CONTRA CONTRA DATE BTA ACCRUED (YY/MM)
4 o7/ / 7 /
LATE CLEARED REASON LATE ACCOUNT
SUPP.DOC. DATE CODE DESCRIPTN. DATE BY AUTHREQ AUTHID
/ / X FORCE ERROR / of
ERROR NOTICE ENQUIRY FORM
PRINT BY AUTHREQ AUTHID REMINDER PRINT TYPE REMINDER RETURNED
/ of / of J of / of J o7
RF2-AUTHORISE PF4-DISALLOW PF5==>C/A DETS. PF9==>SUPP.DOC.DETS.
PF8-PRINT ENQ.FRM/RMDR. PF10-PRINT E.N. PF11-PRINT E.N. RMNDR.
£61

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FO SACS Former Subpostmasters Accounts Page: 1
STATEMENT OF OUTSTANDING DEBT  asat: 11/02/2005 13:24

Name: LEE CASTLETON

Office: MARINE DRIVE Code: 213 337

Appointed: 19/07/2003

Account closed: 25/03/2004

Reason Left: — Suspension Reg Papers:

Error Date Error Type Charges Allowances

25/03/2004 Final Cash A/c balance 25,758.75

OTHER ERRORS

4710312004. © AUTOMATED PRODUCTS 1,256.88

24/03/2004 ~~ NAT. LOTTERY GAME SALES 176.00

24/03/2004 LOTTERY PRIZE PAYMENTS 75.80

SETTLEMENTS - CASHIERS CREDITS

Date Debit Credit

20/01/2005 1,256.88

Actual Balance Outstanding Due To SPMR_ Due From SPMR.

25,858.95
Vw
562

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John H Jones

To: Cath Oglesby/e/POSTOFFICE_..
25/06/2004 09:40 cc:
Subject: Marine Drive Appeal

Cath

I would be grateful if you could answer a number of questions regarding the events pre appeal for the Marine
Drive branch.

(i) What reasons did Mr Castleton give for not taking any preventative measures that you had advised him of
when incurring such account discrepancies.

(ii) What reasons did Mr Castleton provide for the snapshot discrepancies in C/a 47 show a surplus all week
except on the Wednesday when an exact match was declared.

(iii) When you asked Mr Castleton about making error notices good, what was his response.
many thanks

ohn
John Jones

Area Development Manager
_Post Office Ltd

FEISS ISO I IORI BISBEE IISA IORI SI OIE IORI IES IRIE AIE ISIE AAA IIE

This email and any attachments are confidential and intended for the addressee only. If you are not the named
recipient, you must not use, disclose, reproduce, copy or distribute the contents of this communication.

If you have received this in error, please contact the sender and then delete this email from your system.
JESSIE ISO IDOI OIE IS DIO IC OE ODIO REE ORE ERIC EAA IOI

503
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Cath Oglesby

To: John H Jones/e/POSTOFFICE
25/06/2004 17:14 ce:
Subject:

e: Marine Drive Appeal(Document link: Cath Oglesby)

John,
Answers to your questions:

(i) Mr Castleton said that individual balancing wouldn t work in his office as it was only two positions. explained
the benefits of doing this i.e.accountabllity, he didnt understand how to adapt the office into individual tills.I
offered help.He said that as there was really only him and Chrissie(full time assistant) most of the time and Ruth a
part timer and he trusted them , there wasnt much point.He also said towards the last few weeks that the staff
were frightened of going in the safe to get cash out in case they were thought of taking it.

When I suggested that he needed to look at all possibilities not just the computer he got very upset and said that
he trusted the staff 100% and it couldnt be them taking the money. He said that all the Post Office think is that
someone is taking the money.

He kept insisting that it was the computer and that when it all came to light "heads would roll " for all the
sleepless nights and stress they had been under.

I suggested daily snapshots to check the cash against.This was done several weeks into the losses.When asked
why he didnt do these earlier, he just said things like, we were checking transaction logs until eleven o clock at
night, we were under so much stress, we were sick with worry.

When he said it was the days when he remmed stock in that the cash seemed to go wrong, so it must be the
software for that program, I suggested that he check the invoice during the day, but not enter anything onto the
system.Then at close of business complete a snapshot and check the cash.Then enter the stock and repeat the
snapshot.Just to prove or disprove his theory.He never did this.When asked why.He said that Chrissie had been
on hoilday after I suggested it and he never got chance.

(ii) I suggested to Lee that during that week he had a surplus and that what I thought had happened was , on the
Wednesday he had produced a snapshot to see how much cash he should have had.1 suggested that he then
declared the exact amount of cash on that snapshot , to give him a "perfect " balance, he did not declare his
actual cash on hand.He looked a bit puzzeled at this and looked at the snapshots and cash decs.He could not
explain it and said he couldn t remember.I asked him and Chrissie who had written on the cash decs, as they
must have know about the surplus during the week.They both looked puzzeled, Chrissie thought one might have
been hers, they were not sure.I asked who would normally finish off and complete the days work.They said that
Chrissie would.

(iii)It was more the losses making good rather that error notices we discussed.When the losses had been rolled
for those first few weeks, I told him that this couldn t continue, and could he make them good?The amounts had
reached £8k.Lee said that he couldnt afford to make these good, so I told him to contact the helpline and ask for
a hardship form.He did do this, and the first amount was transfered into the suspense account.As the losses
continued the hardship form that had been sent wasnt any good.At interview when I asked him about making the
loss good and being his responsibility, he wouldnt answer directly but said lets see how this all comes out as the
money must be in the system somewhere.

— 504
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Mr Lee Castleton

14 South Marine Drive
Bridlington

YO15 3DB

Date of suspension: 23" March 2004.
Date of termination of contract: 17" May 2004.

Details of charge: The branch incurred a twelve week period of large
unexplained losses, which were not made good. The Subpostmaster blames
the Horizon computer system for these losses, however no evidence has ever
been forthcoming to support such claims and the contract for services was
terminated on the 17" May 2004 under section 1 paragraphs 5 and 10 and
section 12 paragraph 12.

1.Brief Case History

The Subpostmaster Mr Lee Castleton first reported that a large cash shortage
of approximately £1100.00 had occurred in week 39, although this loss was
made good prior to the cash account being produced. The next large shortage
of £4230.97 was reported in cash account week 43 and this was reported to
the Retail Line Manager.

Subsequently on each of the next three weeks the shortages in the account
are rolled over with each increasing loss being added to the rolling total. At of
cash account week 46 there was a total of £8243.10 in counter losses at the
branch.

This figure was then transferred to the suspense account for cash account
week 47. There were further losses in cash account week 48 of £3509.18 ,
this figure was added to the suspense account to give a total held in table 2a
of £11752.78.

The counter loss of £3512.26 in cash account week 49 was rolled over into
cash account week 50.

The final result in cash account week 50 produced another counter loss
£7140.85, which when added to the loss rolled over from week 49 gave a total
of £10,656.11.

The final rolling loss figure at the audit of the 23" March 2003 found there to
be £11,210.56 short in the accounts with £11,752.78 being held in the
Suspense account. The final figure posted to the late account duty totalled
£25,758.75.

Despite receiving advice from the Retail Line Manager and from the National
Business Support Centre Mr Castleton did not implement the advice on
introducing tighter managerial controls to identify the source of the ongoing

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problems, he repeated states that the problems all the fault of the Horizon
computer system.

The balance results that have been recorded by the interim Subpostmasters
since the date of suspension on the 23" March 2004 have in every week
replicated the results that would be expected at a branch that transacted the
level of business of Marine Drive. There have been no issues identified by the
Horizon System Helpdesk, Fujitsu nor have there been any corresponding
transactional error notices that could explain the losses that were reported
over the period in question.

2. Enquiries Pre Appeal

a) Enquires were made to Cheryl Woodward at Transaction Processing to
check on the volume of error notices recorded prior to the loss period
between weeks 42 and 51 as well as checking as the level of error
notices that had been received since the suspension on the 23
March. Only one error notice of note had been received and this was
for the sum of £1256.88 to be charged to the late account. Two smaller
error notices totally £292.00 were also to be charged to the late
account.

b) An analysis of seventeen weeks cash accounts were undertaken to
establish the following: The arithmetical accuracy of those accounts,
the average volume and value of the transactions at the branch over
this period, the average cash usage, the cash ordering cycle as well as
identifying any transactional areas that were outside the mean average
value for the branch.

c) A visit to the Marine Drive branch on the 28" June 2004 to investigate

all those transactions that had been identified as being outside the

mean average value. The transactions were proved against the

Horizon receipts on hand in the branch. A number of further checks

were conducted across the receipts on hand to prove the final totals

that appear in the end of week accounts. Again these were proved to
be correct.

Enquires were conducted with the Retail Line Manager as to why the

advice she had imparted had not been followed by the Subpostmaster

and any reason as to why such losses were consistently dismissed by
the Subpostmaster as being proper to the Horizon System.

e) A daily transactional analysis could be conducted from balance
snapshots in the cash accounts of weeks 46, 47 and 50. The
transactional analysis and cash usage that was conducted indicated
that there were anomalies between the cash declared on each
Tuesday and the final cash declaration on the Wednesday at the final
balance.

f) A further visit to the branch was made on the 30" June 2004 to track
the Girobank business deposits that the branch received to establish
the flow of cash into the office. The branch holds the account book for
a customer account 685 9461 and this customer regularly deposits
significant volumes of cash every Wednesday. Analysis of all the
customers’ deposits that had been made since November 2003 was
conducted to confirm the deposits had been brought to account. The

d

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cash account weeks of 46, 47 and 50 where daily transactional
analysis was being conducted were doubled checked to establish the
levels of cash that had been stated as being received from this
customer.

g) The analysis from the additional cash deposits confirmed as being paid
in by the customer 685 9461 demonstrated that false cash declarations
were being made as the cash usage that occurred in each week
examined (46, 47 and 50) was not reflected in final cash declared upon
the completion of the balance. The cash that was received from this
customer was not reflected in the cash that was finally declared in each
of the weeks examined.

h) Enquires were made to NBSC and HSH to ascertain and verify checks
that had previously been requested and conducted on the Horizon
system to confirm the systems integrity.

i) Analysis of all the telephone records held by NBSC and the HSH to
ascertain the detail of the calls, check the instructions issued to Mr
Castleton as well as check that the branch did not close due to running
out of cash.

3. Appeal Hearing

Notes of Appeal

Mr Lee Castleton
Thursday 1* July 2004 — Darlington Area Office

Present: Mr Lee Castleton (LC)
Mrs Julie Langham, Representative (JL)
Mr John Jones, Appeals Manager (JJ)
Miss Paula Carmichael (note-taker)

JJ made the necessary introductions and outlined the appeals process. He
explained that a decision would usually be made within seven days.

JJ began the interview by stating that LC’s contract had been terminated and
went on to ask him why he was appealing against this decision. LC replied
that he felt there had been computer errors at the branch and he wanted more
information.

JJ asked LC what cash declaration process he used. LC replied that he used
the cash declaration sheet and counted cash from the safe and drawers. JJ
asked if his cash declarations were accurate and LC replied that they were,
nine times out of ten. JJ asked about his process for ordering cash. LC said
that the car auction supplemented their cash requirement (garage which
makes a large daily deposit of cash) and he made sure they had enough cash
by placing an order before 2pm ona Tuesday. JJ asked LC how he knew
how much cash to order and LC replied that he based it on amounts

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previously used and Chrissie’s experience (assistant). JJ asked what he
would do if there was a discrepancy. LC said he would go through the usual
places to look such as Girobank cheques, re-check the cash and go through
all columns on the final balance.

JJ asked LC what his process was for dealing with error notices. LC replied
that he would work back through the paperwork and make it good before the
next balance.

JJ asked what action he took following the first discrepancy in Week 39. LC
said he made a call to the helpline to say he was short and began to work
through all the figures. LC stated he kept asking for help following
subsequent shortages, but his Retail Line Manager said it could be in the
system and would probably come back.

JJ asked if LC had taken any other action. LC said they had discussed
splitting the stock unit or running a manual week. LC said he had been in
favour of running a manual week to prove the system was wrong, but this had
not actually been done and he was then suspended.

JJ asked LC what system problems he thought were happening. LC said that
they constantly had to re-boot the system, the screen was freezing, ONCH
was quadrupling and there were so many other things. LC said he thought it
might be a software problem and at this point JL asked if it was not possible
for the hard disk from the computer to be taken away to be checked. JL went
on to say that she thought it appeared that there was no actual cash missing,
more that the figures had been misinterpreted on the lines.

JJ explained that the actual cash account adds up and that there was only
three things the computer could do:-

° Change balance forward figure
¢ Increase payments
e Increase receipts

JJ produced a report showing a 17-week cash analysis. He showed this to
LC and asked him if it surprised him. LC asked how the report was
generated, to which JJ replied that it was taken from the cash accounts. LC
then responded ‘no then’, indicating that the report didn’t surprise him.

JJ then produced a report showing a cash analysis for cash ordering which
showed rems inbound, average cash in hand, as well as tracking cash in and
cash ordered. JJ asked why extra cash had been ordered to which LC replied
‘l haven't got a clue’. JJ went on to talk about a figure from the report, which
showed that the branch already had £60K, but another £40K had been
ordered. JJ said there was a higher trend between weeks 42 and 49 of how
much cash had been ordered. The difference between payments and
receipts is around £25K-£35K, but the trend in weeks 42 to 49 still was that
Significantly higher amounts had been ordered. LC said he only ordered what
he felt was required. JJ said that for the entire period they actually needed

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between £200K-£265K, but had ordered £305K, of which £20K had gone
back.

JL said at this point that she felt her branch would be similar and went on to
explain that because of pre-planning, she had had to ring up for extra cash in
fear of running out, which had happened a couple of times. JL said it was
difficult to gauge how much cash you would need.

JJ went on to ask LC what had happened to all the extra cash. LC replied
that he didn’t know.

John then went on to talk about two snapshots from 10/2/04 and 11/2/04. On
11/2/04 there was £39K in receipts and £23K had been paid out. The cash
declaration from 11/2/04 stated £33K, when it should have stated £41K. On
that particular day, the auction had paid in £16.5K in cash. JJ asked LC to
explain these figures. LC said that it was a problem with Horizon not adding

up.

Looking at the cash declaration, JJ asked why this was not declared on
Wednesday 11/2/04. LC said that it must be within the Paperwork. Declare
£68,163 on Tuesday, differential £16K receipts and pay out £12K. Should lock
up £72K — declare £81K in office. Declared false figure.

JJ asked why in Week 50 did he declare exactly the same figure of £3,500
each night on the snapshot. LC said it was all generated within the office.
JJ said that LC had told him he had declared accurate cash figures. LC said it

was generated from the system.

JJ said that £16.5K had physically come into the office in cash, but that the
cash declarations did not physically reflect this. LC responded that all figures
are generated from the machine that, in his view, is not working. JJ asked LC
what evidence he had of this and explained that the same Horizon kit was still
in the office. LC asked JJ what happened as part of the audit upon
changeover. JJ explained that they would transfer the difference out and that
the incoming subpostmaster does not carry any loss. A figure of £25K would
be transferred to Chesterfield. JJ stated that since LC had been suspended,
there had been no discrepancies over £22.00 at Marine Drive.

JJ said that Fujitsu had looked at the system on two occasions remotely and
have constantly said that the cash declared does not match. LC said that
checks had only been done going back to 1% March 2004, whilst the problems
had started on 13" January 2004. LC asked why had they not checked back
to when the errors had first started. JJ said that Fujitsu cannot find any
problem with the system.

JJ went on to ask LC about his aversion to the possibility of theft when
mentioned by Cath Oglesby on a visit to his branch. LC said that he was
there most of the time and Chrissie was there all of the time. LC went on to
say that Chrissie had worked there for 17 years and there was no chance that
anyone was left unsupervised. JJ asked LC why he was averse to advice

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from Cath. LC said that in his opinion it was impossible for someone to steal
through that period of time. LC went on to say that he was averse to the
suggestion of theft after 8 weeks of reporting misbalances. LC said that all
figures are generated within the office and that they had been through all the
figures. He said he had tried to find the problem all along, but didn’t believe it
was due to theft as no one was left unsupervised. He said he had received
no support from Cath Oglesby from the start.

JJ said that checks had been done to test the integrity of the system. JJ
explained that Clear Desktop is an integrity system function that checks data.
LC confirmed he understood this.

LC said he could not understand why after week 1 or 2 someone couldn't
have come to support him. JJ explained that the Horizon system has to have

a high resolution of integrity.

JJ moved on to talk about snapshots taken on 9/3/04 (week 50) and asked
why the net discrepancy is the same throughout the week and different on the
final one. LC said it was because the machine is not working and that the
discrepancy should have showed on the top of the snapshot. At this point LC
handed JC the instructions manual.

Whilst JJ read this, LC said ‘John, you are a specialist aren't you?’. ‘Are you
not paid separately for Horizon?’ LC specifically asked for his two comments
to be included within these interview notes.

JJ said he would have to take all the information away and look at it
thoroughly, as well as taking advice from the Horizon team. JJ said suspense
account checks had been done and this was just one issue in a whole set of

issues.

JJ asked LC to show him cash declarations for weeks 45 and 46 and asked
him why he was doing a cashflow before his cash declaration. LC said he
was able to have a look at how it was showing up cash. Again, JJ asked LC
why he was doing his cash declaration after producing a cashflow. LC replied
‘haven't got a clue. NBSC said the facility was there’. LC said he didn’t
know what it was for.

JJ then referred back to why larger amounts of cash had been ordered. LC
replied that he must have needed it. JJ asked LC if he had taken the money.
LC replied ‘no, absolutely not, 100%’. LC said that two tests had been done
throughout this period and found nothing wrong, but obviously there was.

JJ asked LC if he wanted to add anything further. At this point LC handed JJ
a log of phone calls to the helpline etc. JL said she thought it had took a long
time for Cath Oglesby to get involved, especially as they were new to the
Office. JJ explained that the role of a Retail Line Manager has changed and
they are now not the first point of contact for subpostmasters, the helpline is.
JL asked JJ if he personally felt that LC had had enough support and JJ

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confirmed he felt the support he had been given mirrored the support given to
every subpostmaster in Post Office Ltd.

JJ closed the interview.

4, Post Appeal Enquiries

a) A further check was made to Transaction Processing late account duty
to confirm that there were no other outstanding errors notices in the
system.

b) The Horizon final account declarations were handed to Network
Development Manager, Anita Turner who has no knowledge of the
case to conduct an analysis of the losses and the movements into the
suspense account between cash accounts weeks 45 and 50. The
results of this analysis were communicated in a letter to Mr Castleton
on the 8" July 2004.

5. Factors affecting the decision

a) The branch incurred unprecedented declared losses over a twelve
week period , for which Mr Castleton could only offer the explanation
that it was the Horizon System that was causing the errors.

The Subpostmaster has not during any period both prior to his

suspension on the 23 March 2004 and the appeal hearing on the 1°

July 2004 provided evidence that could be used to further investigate

or corroborate the allegations that he continually makes.

c) The checks that have been conducted by Fujitsu indicate that the
branch makes false cash declarations, this analysis was further
corroborated with the daily account analysis that was conducted as
part of the pre appeal enquiries. Mr Castleton was unable to offer
explanations for this, other than it was a fault on the system.

d) The weekly analysis that was conducted identified that the branch
required approximately £265k to meet its transactional requirements
between weeks 42 and 49, however the cash remittances were
increased outside the normal previously ordered remittances. This
resulted £305k being ordered over the same period, with only £20k
being returned. In each case the additional cash is ordered prior to a
subsequent cash discrepancy being declared. Mr Castleton could offer
no explanations as to why such sums of cash had been ordered that
were in excess of what was actually required.

e) That no error notices are evident through Transaction Processing to
provide an explanation to the counter losses that have been declared.

f) The daily cash transactional analysis that was conducted identified in
cash accounts week 46,47 and 50 that there was clear evidence of
false cash declarations being made as the cash received from a giro
Customer was not reflected in the final cash declaration at the branch.
Mr Castleton was unable to offer any explanation for such
discrepancies, other than it ‘was the system’.

b

% 20

511
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g) That the branch has never incurred such large losses since the
suspension of Mr Castleton, despite a number of interim
Subpostmaster operating the branch. Mr Castleton could offer no
explanation as to why accurate balances are being recorded on the
system that he repeatedly alleges is corrupt.

h) That Mr Castleton when questioned denied ever taking the cash
himself.

i) The account declarations and movements into the suspense account
have been extensively examined by both the Retail Line Manager and
colleagues as well as an experienced manager in London to confirm
that the accounts declared by the Horizon system and the suspense
account are functioning correctly.

j) That the branch never ran out of cash and subsequently closed, if the
system was declaring spurious entries in the account there would
always be sufficient cash in the branch to meet its requirements. The
excess ordering of cash ensured that the branch always remained
trading, however Mr Castleton was unable to explain as to why the
additional cash was required in the branch if it was a system error as
any such system error would not affect the cash on hand as this was a
physical entity.

k) The accounting practices of Mr Castleton indicates that he chooses to
declare losses, make good error notices and declare the true position
of his accounts as he pleases. The evidence suggests that the
continuing practice of rolling losses together without seeking authority
to carry them even after the first amalgamated losses are introduced
into the suspense account in week 47, this practice continues from
week 49 until 51.

6. Conclusion

The case has a number of facets interrelated to the branches accounts apart
from the immediate headline issue of the large and unprecedented counter
losses declared at the branch.

The extensive analysis that has been conducted through the accounting
documentation made available for the appeal case as well as the cross
examination of transactional records at the branch indicate that the
transactions performed on the whole are done so accurately and in
accordance with operational guidelines.

This fact is corroborated by Transaction Processing who do not have
outstanding or waiting system adjustment error notices that could other wise
explain such discrepancies. There are only three error notices, and all of
these are to charge that have been added to the late account of the branch
and in each case they relate to a period immediately prior to the suspension
of Mr Lee Castleton.

The cash usage analysis and tracking of transactions that fall outside the

mean average value for the branch however indicate another factor to the
case. The cash that is ordered for the branch requirements is systematically

LU
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increased on four occasions, following the increases in the branch remittance,
their occurs a large cash discrepancy. Such trends are not in keeping with a
computer system error as Mr Castleton maintains, although he is unable to
provide any form of satisfactory answer as to why there is a need to keep
ordering extra cash for the branch.

The normal process for ordering cash at the Marine Drive branch is that the
branch contacts the Cash Centre prior to 14.00pm on a Wednesday to place
an order that will be delivered a day later on a Thursday. At this point of the
week the branch should be able to accurately estimate the actual cash the
branch requires. However in the weeks 42 through to 50 this appears not to

be the case.

The daily cash usage from cash accounts weeks 46, 47 and 50 present
another anomaly when the actual cash usage is compared with the actual
cash received from a Giro business customer, then the cash declarations
made on the Tuesday and Wednesday of each of these weeks has been
demonstrated to be false. Mr Castleton was asked on several occasions to
explain why such entries have been made and he was unable to offer any
treason other the same ‘it’s the system’ fault.

The printouts from the snapshots and final balances have been examined by
numerous managers all who have extensive experience in the use of the
Horizon accounting system as well as the functionality of the suspense
account, all have arrived at the same conclusion independently that the
system is functioning and not creating spurious entries.

Mr Castleton was given advice as to effective management of his accounts as
well as applying a proven methodology to identify either the losses or in the
event of misappropriation the person perpetrating such activity, it is
concerning that he chose to ignore such advice and blindly blame everything
on the computer system. Such an approach by Mr Castleton gives me cause
for concern as he is a relatively new Subpostmaster and is making definitive
statements about a computer system with out even considering any other
case for the account discrepancies.

To summarise, when Mr Castleton was presented with the factual
occurrences from the accounts he has produced that indicate that false
declarations and practices that do not equate to the normal tunning of his
branch he is unable to offer any explanation other than blaming the Horizon
system.

Mr Castleton has however failed to provide any evidence nor show any from
of trend within the branches accounts that would indicate that there was a
problem with the computer system.

He has spent much time and effort in asking irrelevant and unrelated
questions to the case and these I can only conclude are borne out of a wish to
distract away from the actual facts of the case and the unexplained counter

losses.

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It is my opinion that the losses incurred at the branch are genuine and that the
decision to initially suspend Mr Castleton as a precautionary measure and
ultimately terminate his contract for services were soundly based and
warranted in the circumstances.

7. Decision

Appeal Dismissed.

8. Recommendation

The case in respect of the losses was not investigated by Security and
Investigation, however I have considerable concerns over the in payment
practice operated by the Girobank customer (account 685 9461).

The customer leaves the in payment book in the branch at all times and
apparently entrusts the Subpostmaster to complete the deposit entry and
process the transaction following their cash deposit.

No customer receipts are ever handed back to the customer as these are left
with the in payment book.

I was able to establish that all the deposits entered into the customers in
payment book from November 2003 until June 2004 were processed through

the Horizon system.

What I was unable to establish was whether the amounts the customer
deposited at the branch were the same amounts that were entered into the
customers deposit and processed in the same time window.

I would request Security and Investigation to check this customers actual
deposits for the period 42 to 51 as I have already established that the cash
declarations made where the daily analysis in week 46, 47 and 50 does not
match the cash that should have been declared.

I believe that there may be a case to answer in respect of Giro account
suppression.

John Jones

Appeals Manager
Post Office Ltd
Calthorpe House
15-20 Phoenix Place
London

WC1X ODG

153 eee:
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Notes OF THe WE TRA OO) NEL ov J Way Slave

Ot Dos\iqoton fost once .
People Pcesent ot  latervsen)

Mc hee Castleton bc
Wes TOKE Lounahoun xk
Meo, DToahn Jones FF
Foula Carmichael PC.

Inatoduckxyon .

Cc. lte's ice to Pot ARACE Gea Wour Nome

Porta, hauina & ken pceur Lg onthe
Phone. S Po p oes

rT. Why ane You APPEOLnoy AQRASE the
Lecminakion?

“C. There has been Numerous Comeuber Rout
AE doe branch and we Wanted More
NFOSMOION Lo Prove He Colts,

‘5, Co YOY ondarstand how the system work:
~~ YES smole double ent ey ACCOUNENG :

bSed in tne branch?

wc. We OSe A Sheek we Coontecdl cash
Croom Soee x drowess .

VT Ave they accutate?
h.c. \ wovld Sey acne EtmeS @vto

TS phat adovt ordering Cash ?
Uy -

C CEN,
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LC. Chrissie has been there 1°77 YEors
SO we wovld discuss whok We
Needed a oCder oo

awe we oe hone the COS Concaion Pas Ag,

Lc. yes VSVaN yy Wednesclouy & Eidos, —
Somet«mMes lasge amevvnts ¢ Sometimes
Very SMoa\\ .So We howe to Moke

Svee we clowt bety On the Larce
AaMNMouets  1E'S orclered on a

Wednes chou So We base vE on
chrissies, Ex Pemence but we howe
TOW Ovt befoce .
TI whok wovld yee do +e there wasn
Le. We wovl\ad 9° to the OSua\ places
OxXee, Onea.ves , ceckeck cosh « yost
Work ove Way Emnovun ;
TY Whok (S govt PTMESS Cot deol 09 hy
ercoc nonces’
Wo
oc. BWoek back dacousn Ene eae eters
Coc thot Week © MAKE Qoo
Aw next bolonce .

I. polo acktaon Wad taken at the cirst
misbolance in week SV?

Cc. rae inst mis balance woason week ol
Al toksck we_nent theavah ot) aathe7
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fo-Per work over amd over but could Not

Find anypriqag, So \ Make acod the,

Eco acter ringing the helpline I
Muy RLM Came on the ex ACES Lhe

Civst mxsbolonce . lb was her reguiac
\ explained uKok had Kappeneal

v»vsr .
on

Ai screpency nok Lasge would en sily

x come back Eo og. Kot

be Gouncd
KE avdo’t.
WI Whok othec action was taken tan
Week 2?
hc. Te loss Was lLoroer ond Iwas very
EAhaPeYy ~ Vo Kept Singing Ehe helpline.

TT your KLM suggested Spritting the stock
ont. Why were LOL So advecse bo

Ens ?
bh.c. No- not ont \ Week Qa o¢ the problem .

) was Not adverse to setting the

steck unt, I Was adverse to the Fock

that the SOQIES AON had been chacte in
week A aet]er So Many Phone Cais ond

Depeakedly ASKIN, for help. We cliscussee
oO Manual week also and We Aecided
Boot Wars the best wo to prove the
Fouie on the computer, lout Chrissie
over the next two boat ,

WAS AWWY
bepore Wek

ec the \ Was SusPendscl
CARR. S&L. 7h
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ee WHAT PPObBIEMNS he DEES
prowie Rad beer, KEPFENing?

ci.
L SEPEEN Coee ses, Cebeots, Lhe onch
q- Vaok Sup e\ing 5 thece® were so Muy be
ERings bub alunys Something — (hiak ¢
\S aA Soepbwore problem .

Te. \sxvt not possible to toke the hoarol
ANNES owoy to be checked? I dowt
Drink any octvol cash is MSE WG , Moe
ELQVSSES “MUSinterpreted on Kwes I

3-3. The cash account adds LP . We computer
CAN ony Chanag Stings .

Cauw. ShowS L.C a spread sheet o¢ Cosh)

5-5, Ooees Wis SLtprise yous

Lc. Row Was sb opneroteoct?

yy. rom the cash cccounts.

L.c. No /& doesnt, becouse We have sent
bre cash accounts in Pact ko PUSMESS
Soppos & acd hod nem Checked . Bot they
Are ognerotbed Esom the Compucers trot
\ can prove has Carts.

“ST Shows LC a cask cepoct) .
TF, wWhet cosh was ordered, when a Why)!
Devt Know We Must have nesdedl it,

~-C .

-3 Retween weekS 42 and 4A More cash
Woe.S ordered .

-c. \ only ocdered whot Was cequited,

“Lb. Mey beaach is probably VERY sem lor =

spo hove LO Ting Coo extra Cash Coo
UK ote
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FEAT CE FUNDA oot . We hove cun oot
More EhMon once

bic. \aovt know but these Figures of Coorr
One Cosh accoumsS of B Cooly Machi NE

(sx PcodVCEsS ANother cosh sheet)

Te Me Mek auction Cosh, HAis Cosh iS
Pwhosccal .
kL.c. Thre hori 300 LS Cou r® y ~ (stocts to +tolk
aloovk week 49 «+he SUSPENSE GcCcogNt) I
TY. We ave not tOrkirg about Week ar.
Lc. No bor \ con prove in week 49 thot
kWh] System iS FAvLIkD.
x5. What mMokesS yoo egel the system 1s Gol
\E cS some Hociaga Kit oS begore the ascii
hic. What hoppened aS Park o€ the avudkt with
bre Suspense occoval onack tre losses?
ss. \e was transeerred ovt to Chestergictd .
I.-C. So Lhe sostem Ss Not the Some.
Loc. The loragst Loss Since out oe the oRtice=
vs £130- but tris system <s Not the

SaMe .
rr Cusrtsu Leaks of tye System on EWO

occasions and have constontly Sovd the
Cosh decbrabion does tot Motel .

Cc. Whot really AoES concern me there is
trot tne problems stortet IB Tar vorys

the excst test on 2s Febcvary doesnot
18 pa 519
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awe Aetails of how for bock the Syst ery
we® checked x Ene Second HME vb yous
checked on IV Aeril bot ( Was only,
checked Eo Moreh Why? Whot!s the
gop Lect for?
TI, Copksy cowl Cink @ Problem vor the
SUsten) I
Lohy Were you oduercse to the SLgQgestion
og bneet, from R.LAN ,
hoes Most og the time lam there and Chrissie
has been breve Cor WT VES . Ruth iS never
Lect alone and Unsupervised 16 wavlh be
eonpossble ko steal tn Khe time oNoweol.

say, Why where yoo adverse Eo the ooluice
Grom Coth?

lb Was Not the advice I was odverse to,
7b was re Pact thot tb wos apogested
octer & weeks in hec next wsit . Cots

hos Ack helped Erom Ene start ,
Tee system has been checked Ge intearity

kL.c.

You asked Previously Whok clear desk bof
Wes- Bre ioteqrnty evo nction .

Wc: \ understand whet (is Now,

J. ¥. Rogen has a Whioh cesolvtian o€ sategrity.

week 5O has the same net disccEpEen
on balance SnophstsS ali week and Y
ie dkecerent on Ene Gino bolancé .

As \ have sad Prevvously ~this Madkine
VS PRON 520
Wh

LC.
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Too Nane Aone 4ZcheckS and ik has COME
oP cleat

“5.

6. Men Can wou exPlorn weeks 4-9,S0, Si1,82
Erno. balances £3804 oppears as aloss ¢
‘0 placed (ato Suspense .

Cr Looks of the cask aceousts foo Che 2wee

TY yes.

KC. So Why is the inal bolance not Shaw No,
the entey at the toe lb did when the
' Pek went va last tne -

Caro. conknves +o look at Ginal balance and
Cash accounts)

JT, \dowkt keow.

Wes .

kh-c. leis clearly Moved OccroSs Cn Gash
account ian’b st.
J.J, wes.

oe. ek stock « Mof v's not neducet anck the
Shostage Skoys on the loss Line Udth no

Entey on Che Qwn sida to show the loss

Mov ino into sospens® - How can bak be?
rad. conknvesto look at +he Cash accounts
and does not answer ) I
—c. \don’t want to emrnborass geo bout Ons
isbolance wth horvgon s& Clearly stokes
Lnat & PoSibVE Eentey occuss When o Loss
‘3 Moved * VE ond Cocther losS occ UCS
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ck VS showed as nel dyacrep ENV
“ Doha QOL OSES OW specialist aren't
Ace YOv PO

vo, No.

4
Oe?

“hc. Spececotty asked Coc these questions «
the onswer to be put into Who Qoves)
hc. It's thece tn the baloanc& hosi zon book,

CL.c. passes TI the book).

Wc. As My Lost interview tris Was bolked
about Roc BOmimutes bee (tb does Not
appear inthe notes. I cecteved a lebber
se ExfPlanotion Crom RLM Seven days

Locker SX PLANING, Suspense . Why Wovold

She explasn by Letter about suspense
1 <6 Was Noeton VSSLe .

xray, ( van toke all the iMNRocmoakion won to
be Looked at thacoyohIy

c ose Lost weeks the sane
egos, anness over and over, EVES Ehoyg)
vk has been POE iN sospens® = I an Coe
‘ ond She tcok ane LSok
ot Od me tt DOS & Qucther Loss .
Bok «eis not. WS system ‘s Rams»).
Ve goo divide the fiok Losses bythe
weeks “Eis only ENGSbl and gov
hove ON SE TOG _MOHTeE Crom Lottery
PNZES Ror a a in the Same

2 522
7H
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Period se this QVES AN actual de

. + x BKC >
oc 44. CERNE CE
Those Losses ace ol\ Compoter generale
The system <ntearty check Kos not Round

this Govlt , We sustem wos checked
bouxce usas sé not I

TY, Yes. Suspense Checks hove also been
Aone -

Rec. Over acs period a OOM Ng Gourd I

wT, who did Yoo need bo order extra
Cash?

WC. Wwe must hove Needad it ,

yo, Hove yoo token ONY Mone?
L.c. No - absolutely not, lar toch neithes

Me nor Stece hone Loken any Money
becouse th2 Money does Not IexiSh I

Ve is @ Conttey Comeuter Tio tests
have been done and Nothing Round

Yet the Paper Work PCoves the Problem,
the Sogt wore iS fovlky ,

TT, Anything Rocther to add?

LC. No .

rh. I Brink sb took a Long, time to ogt

Cotlh to do anything. She has only

Uistted MY OEACE ONcL TA (lo Months

6 that vuistt war Roc lO minutss
aot _ ce
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becouse her Son Was Gak vA the Cas
Vado think trot Wwe donrst receve
MOON BSvppock Ercan Cokh at ot I

meek AQ Starts bo close

1 belene that Unis <S oa Loos, PECMECEAON OC

“he. MeEkino, Wok +ook Place on thorsdouy
the (FF Toly Boor.

Me, hee Castlekbon .

Mec. Tolan Jones

Mes Joke oxohon

ay
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Personal — In Strictest Confidence

Mr Lee Castleton

14 South Marine Drive
Bridlington

YO15 3DB

5" July 2004

Dear Mr Castleton

I am writing to advise you, that due to your request for further analysis of the
information you provided at your appeal hearing on the 1° July 2004, it will not
be possible to advise you of my decision within seven days.

I will endeavour to conclude the case and advise you of my decision by the
14" July 2004.

Post Office Lid
Registered in England Number: 2154540
Registered Office 80-86 Old Street
London EC1V ONN

The Post Office and the Post Office symbol are
Registered trade marks of Post Office Ltd in the
UK and other countries.

a
Gl
a)

2aQ
Yours sincerely

John Jones

Appeals Manager
Calthorpe House
15-20 Phoenix Place
LONDON

WC1X ODG

CUD

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5341
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Me A. Sones.

COPY - orginal forwarded 1 “Dali nerond AGA OfGeL
- Data Centr 6/7/04 Coo) Sr

WA Bindeffond.,

Dear Noha,

XL have loan locking beck CA ey
noves Q.. the 9 260-00 Ae shorlage before.

maw Bos@ension. L have a Pegular costae
whe Er (eRe n~ woesh tis Opa at cary
Access Caccounk with a Dae CHeae, Back pes

GRO

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a> TL pressed the cheguc bitter al the end of the
PrecessS Che nimchine geemed te ip, T leskad
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am Chere um» ne AP reuepr and Ne erence of

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of cee cleFchng Che. Chegpee. and tha

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of; § Re Reonds. TT Ceol Sure fF You Crees

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Prouder the opening bolonen alt C424 Occomr
are. ene. nA Che rane, At the knee.

A orovaht ur fe the attention of Roth Smpsen

ye. 533
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Personal — In Strictest Confidence

Mr Lee Castleton

14 South Marine Drive
Bridlington

YO15 3DB

8" July 2004

Dear Mr Castleton

I am writing to advise you of the independent analysis that has been
conducted on the Horizon balance printouts that you requested be performed
at your appeal hearing on the 1° of July2004.

The analysis is as follows:-

Cash account week 46,week ending 12/02/2004: The branch declared a
shortage discrepancy of £8243.10.

Cash account week 47, week ending 19/02/2004: The branch opened a
suspense account facility and transferred the shortage discrepancy of
£8243.10 into the discrepancy. The week ending report at the top of the
printout indicates the discrepancy from the previous week and the entry from
the addition to table 2a (the suspense account) which shows a net
discrepancy for the week of zero.

Cash account week 48, week ending 26/02/2004: The branch declares a
shortage discrepancy of £3509.18. The figure of £8243.10 remains in the
suspense account. The table at the top of the print out indicate the zero
discrepancy from week 47 and the discrepancy from week 48.

Cash account week 49 week ending 04/03/2004: The branch transfers the
shortage discrepancy from the previous week of £3509.18 to the already open
suspense account. The rolling total in the suspense account now stands at
£11,752.28. The branch then declares a further shortage of £3512.26,

Cash account week 50, week ending 11/03/2004: The branch does not
transfer the previous shortage discrepancy from week 49 of £3612.26 into the
suspense account. This shortage discrepancy Is rolled over Into week 50
without the Subpostmaster making good the discrepancy, It should be noted
that rolling losses forward Is in breach of the Subpostmasters Contract.

The final balance declared of £10,653.11 is made up of £3612,26 from week
49 and a further shortage discrepancy of £7140,85 from week 60,

534
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Yours sincerely
John Jones
Appeals Manager
Calthorpe House
15-20 Phoenix Place
LONDON
WC1X ODG

Post Office Ltd

Registered in England Number: 2154540

Registered Office 80-86 Old Street

‘London EC1V SNN

The Post Office and the Post Office symbol are

Registered trade marks of Post Office Ltd In the

UK and other countries.

- 535

BY
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DARI SC Ton) ARZA OFFICE,
CRo23 Teer,
‘Dreiser,

Dear oka,
SC TILY Leoy . le , as L Shake in Mel PSM

Yerview and min inlerne.) On the to Mev, OF
have had Che Cagores over Weekx I 7 52
proken door and Asoled af by other rastmasecy

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torgon beole On NMiunnta/oIS eccasyenn’ The Follencin
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c pored te weet AV2 S80. TA Wweekt 47 When

Ne SoSpenke. Accom is (Ver opened Cha week
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rd MeP Proves cahuch i feduad 64 Tre arcoont
acod unto table Qn,

Bol the Secand time an eniry ts rade,
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nko SoSpPense (rable >) Than en the [nak balance
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KG $ 3512-26. Aan as T have previowrty Clarfiec
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- DSc -ve JOU yy *
1 NET 3512-26"

Wa not, it Showed Disc tue. b-00". as Yoo
: Dwse -ve 3512-26 ‘
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ON See.
537
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al hse Lam tlc Ce hee. to pres ako ook (hat 16
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Mey. gn
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hese Crane threogh thes compJler Sens hor
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ae

Chese Layo ece onl over Chose. Chree ech we

a Fooly Oud Nok bolance. buy Pq-u7 anced
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Prom Your ndepencant analysis 1S Chere lore.
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vortung un. Simple lovble entry Gccoonkiag Cannot
haplan US Werluags ©vF ene Way ene LIeck
NA casther L044 ancthe- weet, Stock and
4ep Colleos Oxroogh ant clearly Shaws the
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tov 1 also add thak the sospense

arcoont Ooo dnoy fe Che notex faleon at bt
Ulervincss (Ss Aok menkonod, lok on both cccace
lonss beth Parkers SPolce ok teat lengtr ateook
thes Sobsect: Aocin as ak the Corsk wervrecs

enh mM leKer fs Hoo on the VA Toley p>
heave conten fe oe explacning the compoter

Coutk that apparently wan nef eianhoned I Le!
ct least nok in Rsk SGce ro Tranaenply I Bor
A> Cndena whe War Present at Chose crbeiien

adsvld, bel Ype oF of Course COad. AF Qeat length
New Woo oride ke ma ex lacning the analysis

yan Che Cour ond the. oer Os On Shoot ane
ve Valvexy Whon Cs Uscoedk hroug) prove tho
I Ab The Supleny works bx deoble enkry, Se

Shelever heppons on ene Selo nus alen have
“4 Oppexke ect on the other Sicle.. ‘ek Chose.

GRO.
‘8 July 2004

Dear Mr Castleton

Jam writing.to adv
Thursday 1" sue

\ppeals. Manager
rpe House.

16-20. Phoenix Place

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