FOR USE OF COUNCIL MEMBERS ONLY
NFSP00000213
NFSP00000213
NATIONAL FEDERATION OF SUBPOSTMASTERS
REPORT OFA
MEETING OF THE
COUNCIL
held on
20 & 21 JANUARY 2020
at
HOLIDAY INN CAMDEN LOCK
LONDON
NFSP00000213
NFSP00000213
© National Federation of SubPostmasters Strictly Private & Confidentiai
2. CEO REPORT ¢
(a) Court Case Update (papers circulated) (CEO presentation
included as Appendix A)
. CEO was not a lawyer or an IT specialist. There was a very
technical judgement document amounting to 1,500
paragraphs and nearly 600 pages over 4 different sections,
e Justice Fraser was looking at 8 areas covering 15 issues and
29 bugs, errors or defects within Horizon that could have
affected operator's accounts. Was the Horizon system
robust? So what now?
. As the presentation is attached, detailed notes are not
going to be provided.
. First ran through the various key people involved in the case
with their background.
. Trial was not about innocence or guilt. It was about
whether Horizon has issues that could have affected
operator's accounts. €
. 8 areas that needed to be looked at. 15 issues the trial was
concerned with.
° From the discussion following the presentation, various
points arose.
° HR4UK looking at the various contracts and CEO would
report back on their findings. Need to be sure that if a spm
has dismissed a member of staff due to shortages that they
cannot come back and claim unfair dismissal due to the
judgement, however subject to confirmation, it was
understood that any unfair dismissal claim had to be
brought within 3 months of that dismissal. HR4UK looking
at staff contracts and would report back, CTION
° As to who was paying the £57.7 million awarded, it was
confirmed as PO but there was some discussion as it is all
government money, therefore the taxpayer,
° Made very clear that the NFSP would not get involved in
retribution and vengeance, but would work hard to ensure €
nothing similar would happen in the future. It was about
building relationships, not destroying them. There were
others who were choosing to take that route.
° Also made clear that the NFSP was told all the way along
that Horlzon was robust and accepted that in good faith.
. In the new contracts there was no right of appeal, however
that was a process the NFSP wanted put in place. The NFSP
had the right to challenge PO and go to mediation if
required,
. Some doubts cast as to how open and transparent PO were
being about the past. If it had been handled differently
they would not have ended up in the current situation.
° Run through of the 29 actual bugs, errors and defects
identified during the court case all of which had occurred
over a 14 year period {but not necessarily at the same time
or for the whole period).
§
Board Meeting _ 20 & 21 January 2020 ; Page 3 of 34
NFSP00000213
NFSP00000213
© National Federation of SubPostmasters Strictly Private & Confidential
* Crucial that those who had invested in a post office were
once again in possession of a marketable business as the
court case had damaged their value and credibility.
° Both the NFSP and it's officials who had acted in good faith
were covered should anyone attempt litigation against the
organisation or an individual re the Horizon debacle.
. NFSP must have a clear structure in place that is clear and
concise to enable open-ness and transparency. If there is a
problem it will be investigated properly and our member
has the confidence that they have been treated with
respect, they are innocent until proven guilty, and we can
access all the information required. NFSP must know who
will be involved with cases out in the regions, and ensure
there is a clear structure in place. Information will need to
be recorded on the CRM so anyone else who deals with a
member will have notes on what has gone before, and will
also allow Nilesh Joshi, as Legal & Regulatory to monitor
situations centrally and ensure there is fairness and
transparency across the UK. Important that our
representatives acquire all the information they require in
advance of any hearing, not at the last minute.
. There was a discussion on what the NFSP could/should
have done but the only way was to move forward rather
than look back, Not all the cases were either members or
ever came to the NFSP for help. The NFSP acted in good
faith and could only go on the information given. The
evidence is now available however it was not at the time. i
e The NFSP had the opportunity to use the situation to ]
improve things from now on.
. Questionnaire to be sent to Board members to get the
contact names and details for any official who deals with
interviews. First step in setting up a formal process. [ACTION]
. Felt that cases should be dealt with within regions rather
than passing them on to Shoreham, and there was always
advice available to assist when dealing with a case locally.
. Information would only be for the use of Nilesh Joshi so
there would no chance of a data protection breach.
e — View that those who deal with contractual issues should
receive training. Action]
e¢ We want resolution rather than prosecution and it was
crucial that the NFSP had the correct records should such
an event ever occur in the future. It will also give the
opportunity to challenge PO if it was felt they were being
unreasonable in the future,
° For the NFSP to be able to keep a watching brief on the
Case Review Team, it was crucial that Directors kept Nilesh
Joshi informed of any cases or information they hear about
and keep clear records. (AcTION]
Board Meeting 20 & 21 January 2020 Page 4 of 34
NFSP00000213
NFSP00000213
© National Federation of SubPostmasters Strictly Private & Confidential
° Clarified that PO lost the court case 40-0, they did not win a
single point. NFSP has to build a relationship going forward, ¢
there are people who want to destroy the organisation by
creating chaos and asking for a Judicial Review, It was
about unity not vengeance and retribution, and the NFSP
had to learn from the mistakes of the past to move on
stronger.
. NFSP mantra had to be based on building relationships and
trust back up again with members. Reason for the CEO
touring all the regions to ensure everyone was in the same
place.
. Should questions be asked of PO as to what/where all the
money from their suspense accounts had gone (unallocated
money from the Horizon issues}? Opportunity would be
there to ask at the next meeting with PO. I
NFSP00000213
NFSP00000213
NFSP00000213
osu a NFSP00000213
+ Who are the key people involved in the trial?
* Horizon Trial concerns itself with 8 areas covering 15 issues
+ Are there bugs, errors or defects within Horizon that could affect
Subpostmasters accounts?
* is the Horizon system robust?
» So what now?
nisp
The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
Key People Involved in the trial
« Justice Fraser
« Cambridge Law Degree
* High Court Judge since 2015
¢ Officiates in the Technology and Construction Court
The voice of the
www.nfsp.org.u k UK's post offices
NFSP00000213
os ns NFSP00000213
Key People Involved in the trial
« Anthony De Garr Robinson QC - on behalf of Post Office Ltd
+ Oxford & Harvard Law degree
* Queen's Counsel since 2006
- Has been in the Legal 500 for over 20 years
« Practices out of One Essex Court chambers
The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
e a Key People Invoived in the trial
wy
« Patrick Green QC ~ on behalf of Claimants
* Cambridge Law degree
* Queen's Counsel since 2012
* Practices out of Henderson chambers
E
os
The voice of the
www. nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
Key People Involved in the trial
¢ Dr Robert Worden - IT special witness for Post Office Ltd
* PHD in Theoretical Particle Physics from Cambridge University
+ Discovery Forensics since 2010, which specialise in IT project
disputes, information security and computer crime
nr sp
= The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
Key People Involved in the trial
* Jason Coyne - IT special witness for Claimants
* Partner at IT Group
* Consultant in Technology, Digital Forensics and e-Discovery
nfsp
, The voice of the
www. nfsp.org.uk UK's past offices
NFSP00000213
NFSP00000213
Key People Involved in the trial
* Torstein Godeseth
* Chief Architect at Fujitsu
* Head of Application Support & Maintenance
The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
a] Key People Involved in the trial
* Angela Van Den Bogerd MBA, MCIPD
* People and Change Director for Post Office Ltd
* Role focuses on the people side of change, job roles and
organisational structures
of the
wew.nfsp.org.uk UK's past offices
NFSP00000213
NEP 3
What was the premise of the Horizon Trial?
* Purpose - does Horizon have bugs, errors
or defects?
C + The Trial Did Not Consider if-
hy « Subpostmasters or Assistants make
mistakes?
*« Subpostmasters or Assistants commit
fraud?
www. nfsp.org.uk The voice of the :
UK's post offices
NFSP00000213
NFSP00000213
° Horizon Trial concerns itself with 8 areas covering 15 issues
The 8 areas:
Accuracy and integrity of data
Control and measures for preventing/fixing bugs and developing the system
Remote Access
Availability of information and report writing
Access to and/or editing of transactions and branch accounts
Branch statements, making good and disputing shortfalls
Transaction corrections
The meaning of the word “robustness”
ON OM PWN
www.nfsp.org.uk
NFSP00000213
NFSP00000213
‘ae ees “ae ‘ant
¢ Horizon Trial concerns itself with 8 areas covering 15 issues
The 15 issues are--
1, Question - To what extent was it possible or likely for bugs, errors or defects of the
nature alleged to have the potential (a) to cause apparent or alleged discrepancies
or shortfalls relating to Subpostmasters’ branch accounts or transactions, or (b)
undermine the reliability of Horizon accurately to process and to record transactions
as alleged?
2. Question - Did the Horizon IT system itself alert Subpostmasters of such bugs, errors or
defects as described in (1) above and if so how?
ot
Question - To what extent and in what respects is the Horizon System “robust” and
extremely unlikely to be the cause of shortfalls in branches?
4. Question -: To what extent has there been potential for errors in data recorded within
Horizon to arise in (a) data entry, (bb) transfer or (c) processing of data in Horizon?
The voice of the ]
UK's post offices
5. Question - How, if at all, does the Horizon system itself compare transaction data
recorded by Horizon against transaction data from sources outside of Horizon?
www.nfsp.org.uk
NFSP00000213
NFSP00000213
¢ Horizon Trial concerns itself with 8 areas covering 15 issues
The 15 issues are- continued
6. To what extent did measures and/or controls that existed in Horizon
prevent, detect, identify, report or reduce to an extremely low level of risk the
following: a. data entry errors; b. data packet or system level errors (including
data processing, effecting, and recording the same); c. a failure to detect,
correct and remedy software coding errors or bugs; d. errors in the
transmission, replication and storage of transaction record data; and e. the
data stored in the central.
7) Question: Were Post Office and/or Fujitsu able to access transaction data
recorded by Horizon remotely (i.e. not from within a branch)?
8) Question: What transaction data and reporting functions were available
through Horizon to Post Office for identifying the occurrence of alleged
shortfalls and the causes of alleged shortfalls in branches, including whether, ge
they were caused by bugs, errors and/or defects in the Horizon system? nisp
Lo
: The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
¢ Horizon Trial concerns itself with 8 areas covering 15 issues
The 15 issues are:- continued
9. Question: At all material times, what transaction data and reporting
functions (if any) were availabie through Horizon to Subpostmasters for: a.
identifying apparent or alleged discrepancies and shortfalls and/or the causes
of the same: and b. accessing and identifying transactions recorded on
Horizon?
10 Question: Whether the Defendant and/or Fujitsu have had the ability/facility
to (i) insert, inject, edit or delete transaction data or data in branch accounts;
(il) implement fixes in Horizon that had the potential to affect transaction data
or data in branch accounts; or (iii) rebuild branch transaction data: a. at all: b.
without the knowledge of the Subpostmaster in question; and c. without the
consent of the Subpostmaster in question.
Tl. Question: If they did, did the Horizon system have any permission controls
upon the use of the above facility, and did the system maintain a log of suc 11
actions and such permission controls? ‘sp
The voice of the
UK's post offices
www.nfsp.org.uk
NFSP00000213
NFSP00000213
* Horizon Trial concerns itself with 8 areas covering 15 issues
The 15 issues are continued
12. Question: if the Defendant and/or Fujitsu did have such ability, how often was that
used, if at all?
13. Question; To what extent did use of any such facility have the potential to affect the
rellability of the Branches’ accounting positions?
14. Question: How (if at all) does the Horizon system and its functionality: a. enable
Subpostmasters to compare the stock and cash in branch against the stock and cash
indicated on Horizon? b. enable or require Subpostmasters to decide how to deal with,
dispute, accept or make good alleged discrepancy by (i) providing his or her own personal
funds or (ii) settling centrally? c. record and reflect the consequence of raising a dispute
onan alleged discrepancy, on Horizon Branch account data and, in particular: (i) does
raising a dispute with the helpline cause a block to be placed on the value of an alleged
shortfall: and (ii) is that recorded on the Horizon system as a debt due to Post Office? d.
enable Subpostmasters to procuce (i) Cash Account before 2005 and (ii) Branch Trading
Statement after 2005? ¢. enable or require Subpostrnasters to continue to trade if they
did not complete a Branch Trading Statement, om
15. Question: How did Horizon process and/or record Transaction Corrections? re
war ” The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
_.NFSP00000213
* Two principles (my emphasis)
« Asa human being I reserve the right
to make a mistake and
+ No computer system is 100% reliable
or infallible.
www.nfsp.org.uk The voice of the )
UK's post offices
NFSP00000213
NFSP00000213
* Are there bugs, errors or defects within Horizon that
could affect Subpostmasters accounts?
* The Judge via the Horizon trial identified 29 bugs, errors or defects
«+ 20 were accepted by the Post Office
« 8 where Post Office did not them
* 16 last a couple of months
+ 13 were present for years,, 1 for 14 years and another for 10 years
ry
The voice of the
www.nfsp.org.uk UK's post offices
NFSP00000213
NFSP00000213
* Is the Horizon system robust?
* Legacy 2000 ~ 2010 - not remotely,
* Online (HNG-X) 2010 ~ 2017 questionable and does not justify
the confidence that PO placed in it and
* HNG-A 2017 to present - is robust
bod
be
The voice of the
www.nfsp.org.uk UK's past offices
NFSP00000213
NFSP00000213
“The issue is not whether such bugs, errors or defects did in fact
cause such discrepancies or shortfalls in the claimants’ accounts
specifically. That separate or different issue - the effect upon
claimants’ branch accounts - is a more claimant specific one. It
will have to be determined at some stage, for any of the claimants
whose individual claims come to trial in the future. It may require
expert forensic accountancy evidence. It was not ordered to be
dealt with in the Horizon Issues trial.”
www.nfsp.org.uk
So what now?
+ Via Director for Legal & Regulatory
1
2
3.
4
5
Structure
. Training
Recording on CRM
. Transparency of information
How to conduct an interview
* Pre-meeting
« tnformation gathering
* Understanding contract and law
* Escalation
Required resources
+ Legal advice etc
www.nfsp.org.uk
NFSP00000213
_NFSP00000213
al ‘Sp
The voice of the
UK's post offices