WITNO1300100
WITNESS: DAVID THOMAS HEDGES
STATEMENT NUMBER: WITNO130_01
EXHIBITS: 0
DATED: Jan 14, 2022
POST OFFICE HORIZON IT INQUIRY
FIRST WRITTEN STATEMENT OF DAVID THOMAS HEDGES
THIS STATEMENT IS PROVIDED IN RESPONSE TO THE RULE 9 REQUEST OF
THE PUBLIC INQUIRY DATED 29/10/2021 TO ADDRESS THE HUMAN IMPACT OF
THE FAILINGS OF THE HORIZON IT SYSTEM
will say as follows:-
PERSONAL BACKGROUND
1. 1am 68 years old and currently live ini ina
rented bungalow with my wife. My wife and I are retired and currently receive
our pension. I have two grown up daughters and two grandchildren.
POST OFFICE HISTORY
2. Once my children had reached secondary school age, my wife and I looked
for a change of lifestyle. We were keen to acquire a small business in a rural
location that we could run ourselves with some part time assistance.
Page 1 of 12
WITNO1300100
3. We liked the idea of moving to the countryside to bring up our children and
the thought of running a small community Post Office was something that
appealed to us. We knew the business would need to provide a home and
generate an income whilst living in a pleasant living environment.
4. After four or five months of looking, we were offered the opportunity to buy
Hogsthorpe Post Office. I recall the purchase price was conditional on me
being accepted by the Post Office to run the branch. As part of the process, I
applied to become Sub-postmaster of the branch. Hogsthorpe Post Office
was located within a larger retail store which adjoined a large residential
property.
5. As such, we bought not only the Post Office branch and retail store in which
it was situated but the adjoining 5 bedroomed house that became our family
home. I believe we paid around £115,000 to purchase the business and
associated property. I ran the branch for 15 years, from 1994 until the
termination of my employment in 2010.
CRIMINAL ALLEGATIONS AND ANY PROCEEDINGS/CONVICTION
6. On the 5 May 2010, the Auditors visited my branch. A discrepancy of
approximately £23,000 was found and I was immediately suspended. I was
interviewed under caution on 2 June 2010 at Doncaster Royal Mail Centre.
7. Following the interview, my contract was terminated, and I was charged with
the Theft of £23,660.79 and three counts of False Accounting.
8. I pleaded guilty as I felt I had no option. The criminal solicitor appointed to
represent me advised me that if I agreed to plead guilty and was able to
Page 2 of 12
WITNO1300100
provide satisfactory character references, he was 95% certain that I would
receive a suspended sentence rather than a custodial sentence.
I recall the Post Office was seeking a four-year custodial sentence. Spending
that long in prison would have destroyed me and my family. I was
subsequently sentenced on 4 February 2011 at Lincoln Crown Court. I was
sentenced to 7 months imprisonment suspended for 18 months together with
120 hours of unpaid work and costs of £1000.
THE HUMAN IMPACT
10.
The human impact which the failings of the Horizon IT System have had and
continue to have upon me and my family are set out in the remainder of this
statement. The section headings follow the particular questions posed by the
Inquiry.
WHAT WERE THE CONSEQUENCES OF BEING REQUIRED TO MAKE GOOD
APPARENT SHORTFALLS SHOWN BY THE HORIZON IT SYSTEM?
11.
12.
As part of the process of acquiring the business the one point of any
substance that I recall was explained to me during the interview was that in
my role as Sub-postmaster; I would be held personally responsible for any
financial loss that arose within the branch. That is something that was drilled
into me from the very start.
Between 2003 and 2007 I started to get discrepancies that I simply could not
reconcile. After having shortfalls and escalating the matters to the Post
Office, it was made clear to me that I would have to make up the shortfalls
even though I had no idea how it had occurred.
Page 3 of 12
13.
14.
15.
16.
WITNO1300100
At the beginning 2009, a large shortfall of £10,000 occurred. I called the
helpline nearly every day making enquiries as I simply could not accept such
a large shortfall. I believe this triggered a visit to my Post Office. No
explanation was given to me on the reason for the shortfalls, but the visitor
said in documents I have read since “/ have to report that I could find
absolutely no reason for the losses in this office ...”. Once again, I was told I
would have to “make good” the shortfalls myself. Eventually the Post Office
arranged for me to pay this substantial sum off in monthly deductions from
my salary.
As mentioned above, between 2003 and 2007, the shortfalls built up to a
couple of thousand pounds. It was made clear to me that I would have to
make good the shortfalls. I simply did not have the cash resources to be able
to do so and I was therefore required to put in place an arrangement
whereby the shortfall would be paid by way of a deduction from the salary
paid by the Post Office. I made at least three separate arrangements to pay
about £2000 each time by instalments. It always seemed strange to me that
all they were worried about was getting the money, not why it had
supposedly gone missing. To me, it seemed they just hid behind the clause
in the contract that this was to happen.
Between 2003 and 2007 the Post Office were always content to deal with the
losses that way. During that period, I believe that I paid approximately
£6,000 from my salary to cover unexplained shortages that I could not
explain, and which remained unresolved.
By 2007, I had reached the stage where I felt that I could not go on paying
money to cover off unexplained errors that I could not account for. I felt that
Page 4 of 12
WITNO1300100
the Post Office business was becoming a money pit. The shortfalls
continued and in late 2009 or early 2010 I borrowed £20,000 from my mother
to pay into branch. At the time of the Audit, the accumulated losses were in
the region of £23,000. Shortly following the interview, I repaid the shortfall of
around £23,000 by way of further borrowings from various family members.
WHAT WERE THE COSTS OF MAKING GOOD ALLEGED SHORTFALLS
SHOWN BY HORIZON?
17. Initially, I had deductions taken from my salary to cover the amount of the
shortfalls. The deductions amounted to around £6,000.00
18. The shortfalls continued and I could no longer afford to have my salary
deducted. In 2010, I had to borrow £23,000 from family members, including
£20,000 from my mother, to pay into the branch.
HOW WERE YOU AFFECTED WHEN ALLEGED TO BE RESPONSIBLE FOR
SHORTFALLS OR DISCREPANCIES SHOWN BY THE HORIZON IT SYSTEM?
19. When the Auditors came across the discrepancy and the cheques I had
written to try and cover the shortfall, it was apparent to them that this was not
in order; I admitted there and then, on the same day, that I had put those
cheques in with a view to cover off the losses so that I could buy myself
enough time to remedy it.
20. Initially, I was relieved when the auditors arrived. However, in other ways I
was shell-shocked. By this I mean I was in turmoil as I knew that it would
take the family down financially and perhaps tear the family apart.
Page 5 of 12
WITNO1300100
21. I was extremely worried about the future. I felt ghastly. The experience was
horrible. I thought to myself I needed to face people and tried to be positive;
whilst the Auditors were packing up the Post Office, I decided to get on with
the business.
WHAT WERE THE CONSEQUENCES OF BEING HELD RESPONSIBLE FOR
SHORTFALLS AND DISCREPANCIES SHOWN BY THE HORIZON IT SYSTEM?
22. In late 2009 or early 2010 I borrowed £20,000 from my mother to pay into
the branch. This was to cover the shortfalls which were occurring. Following
this, further shortfalls occurred on a weekly basis and on 5" May 2010 the
Auditors visited my branch. I was suspended.
23. The keys were taken from me, and I was informed that Investigators would
be in touch. It was horrible. I was interviewed under caution on 2 June 2010
at the Doncaster Royal Mail Centre. I was repeatedly asked to explain where
the accumulated discrepancies had gone. It was repeatedly put to me that I
had stolen the money. The Investigators were convinced I had stolen the
money. I explained that this was not the case, but the reality of the situation
was that I could not offer a substantive explanation for the shortfall other
than pointing to a possible glitch within Horizon, on a technical level, that I
could not explain or evidence. Notwithstanding my payment of the shortfall, I
was charged with Theft of £23,660.79 and three counts of False Accounting.
24. After I was interviewed, my contract was terminated on 14 June 2010. I was
told that I was dismissed and that an investigation would take place. I felt this
was not a fair decision. I felt forced into the situation. I felt very down about
Page 6 of 12
25.
WITNO1300100
this, but I knew I had a living to make, a mortgage to pay and a family to
support.
I got a telephone sales and marketing job. We got someone to lease the
shop, but I tried to keep myself occupied. We kept the newspaper business
running.
WHAT WERE YOUR FINANCIAL LOSSES CAUSED BY ACTION TAKEN
AGAINST YOU IN RELIANCE UPON HORIZON DATA?
26.
27.
28.
29.
I suffered a loss of income from the date my contract was terminated by the
Post Office until the date I commenced new employment.
Whilst it had always been the intention of me and my wife to keep the
business until we reached retirement age of 65, at that stage we were so
frustrated and concerned that we decided to put the business on the market.
We had the property and business valued by a number of agents at between
£380,000 and £400,000 and we therefore put the property and the business
on the market at that time for a sale price of £399,000.
In 2010, following very significant reductions in the sale price, we had
someone very interested in buying the property and business and I was
desperate to keep the business on an even keel to allow that sale to
proceed. As a result of my conviction, we were not able to sell and eventually
the Post Office closed, and subsequently the Shop shut at the end of
September 2010.
Page 7 of 12
WITNO1300100
WHAT EFFECT DID IT HAVE TO BE ACCUSED OF COMMITTING CRIMINAL
OFFENCES AS A RESULT OF SHORTFALLS AND DISCREPANCIES SHOWN
BY THE HORIZON IT SYSTEM?
30. I was terrified that I would end up in prison. It was a feeling of sheer terror.
What compounded my anxiety was that I understood that, if I received an
immediate custodial sentence, I would be taken from the dock to the cells
and I would only be able to take with me what I had on me in the dock in
court.
31. I have sleep apnoea. I depend on my CPAP machine. Without this machine I
would stop breathing at night and might die. It was a terrible worry.
WHAT WERE THE CONSEQUENCES OF BEING CONVICTED OF A CRIMINAL
OFFENCE AS A RESULT OF SHORTFALLS AND DISCREPANCIES SHOWN BY
THE HORIZON IT SYSTEM?
32. As explained above, I was sentenced to 7 months imprisonment suspended
for 18 months together with 120 hours of unpaid work and costs of £1000.
33. After the court hearing and my conviction and sentence, I attended my
Probation Office who indicated that my Community Service would be at a
Charity Shop. Initially, I was expected to work 8 hours a day once a week. I
wanted to carry out my sentence as quickly as possible and I asked if I could
work every day for a few weeks. My Probation Officer agreed.
34. I lost my business as a result of the Post Office and my conviction, and I was
forced to sell it at a discount.
Page 8 of 12
35.
36.
37.
38.
39.
40.
WITNO1300100
The prosecution had a detrimental effect on my health. I initially found it very
difficult to discuss anything in relation to the prosecution. I was not a
criminal, but I had a criminal conviction.
The reputational damage that this has caused to me, my wife and our
children is impossible to quantify.
Once the court case was over then the real problems set in. I needed a job
but getting one as a man in his late fifties is difficult enough, but if you then
add in a criminal conviction, it proved even worse.
My biggest upset was that I applied for a Branch Managers job with The
Plumb Centre, a position I was more than qualified for, had a successful
interview, and offered the position. When completing the joining forms, I
declared my conviction and the job was withdrawn.
Any job offer I did receive, was soon withdrawn as a result of my conviction.
My wife and I have been forced to live in rented accommodation; the rent is
high and there is a lot of uncertainty, but the waiting list for a council or
housing association property in my area is over five years. I had been
looking forward to a comfortable retirement; we had planned to sell up and
buy a smaller property and put the rest of the money in the bank for a rainy
day. This was taken away from us, and it is very upsetting.
WHAT EFFECT DID THESE ISSUES HAVE UPON YOUR RELATIONSHIPS WITH
YOUR FAMILY, FRIENDS, COLLEAGUES AND LOCAL COMMUNITY?
41.
I was so traumatised by the whole situation, and, in a small rural community,
word spread quickly that I was to be prosecuted for theft and trade dropped
Page 9 of 12
42.
43.
WITNO1300100
off significantly. We got to a point at the end of September 2010 where we
were losing money every week, so we voluntarily shut the shop.
Several people from the village shunned us, some even crossing the road to
avoid us. After I was suspended, I had to deliver newspapers with my face
on it, following reports of my criminal charges. These were some of the
reasons why we moved out of the village and into a nearby town which
provided some anonymity.
That did and still does, hurt.
PLEASE DESCRIBE THE DIRECT AND INDIRECT EFFECT WHICH THESE
ISSUES HAD UPON THE MEMBERS OF YOUR FAMILY?
44.
45.
46.
47.
The whole experience has affected me and my family in a hugely detrimental
way.
We are still hundreds of thousands of pounds out of pocket. We were forced
to sell our Post Office, Retail Business and a comfortable home at a
distressed price as the Co-Op bank had given us three months’ notice that
they would start the process to default our loan and throw us out. I had just
lost a temporary job and could no longer pay the repayments. We received a
very low offer of £135,000, which we accepted as it allowed us to repay the
bank approximately £116,000 and the other money paid other pressing
debts and the fees involved in the sale.
We just avoided bankruptcy and have been forced to live on benefits ever
since.
A few days after I was sentenced, my older daughter had to go to someone’s
house and listen to the owners going on about the terrible man at the Post
Page 10 of 12
WITNO1300100
Office, not knowing that she was my daughter. She suffered 30 minutes of
diatribe and vitriol until she got outside, sat in her car and cried for 30
minutes. The situation has affected my whole family.
48. Recently, I have come home from a shopping trip to find my wife,'.
confused state. She was so confused that she called me her previous
husband's name. My initial thought was that she had had a stroke but on
taking her to the hospital it seemed this was not the case. She had a number
of physical tests carried out. The Doctor seemed to think that! had
suffered some form of mental episode. I told him about the deep trauma both
her and I had endured with regard to the Post Office and my conviction. We
both needed to be very strong to get through all the upset and worry and
possibly now as we are in calmer waters ihas allowed her mind to
relax, and it had gone too far! GRO / appears to be getting better, but she has
no memory of about 5 or 6 hours on that Monday. My wife has now received
a formal diagnosis after the above incident. She has been diagnosed with
Transient Global Amnesia. This can be brought on by stress, even though
occurred many years ago and has now eased.
CONCLUDING REMARKS
49. The mental toll from that fateful audit day onwards was crippling, as the full
might of a huge company was unleashed on me and only the support of a
wonderful wife, loving family, close friends, and my faith, saw me through.
50. However, I count myself lucky compared to others who suffered in our group,
but we all have one thing in common, this experience has scarred us for life,
and I feel that no one is being held to account for this.
Page 11 of 12
WITNO1300100
Statement Of Truth
I believe that the facts stated in this witness statement are true.
Position Or
hy -meage ar reaner remy Office Held:
Print Full Date of signature: Jan 14, 2022
Name: DAVID THOMAS HEDGES
FILE REFERENCE:
Page 12 of 12
WITNO1300100