Post Office Horizon scandal: why were subpostmasters convicted, court ruling – and Fujitsu IT system explained

39 workers have had their convictions overturned by the Court of Appeals, marking a final chapter in the Horizon scandal

(Photo: PAUL ELLIS/AFP via Getty Images)

Thirty-nine former subpostmasters who were convicted of theft, fraud and false accounting because of the Post Office’s defective Horizon accounting system have had their names cleared by the Court of Appeal.

Subpostmasters’ lives were “irreparably ruined” as they lost their jobs, homes and marriages after they were prosecuted by the Post Office – which knew its Fujitsu-developed system had “faults and bugs from the earliest days of its operation”, the Court of Appeal heard.

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The postmasters were convicted - and some were imprisoned - after the defective Horizon accounting system was installed.

Here is everything you need to know about it.

What is the Horizon scandal?

The Criminal Cases Review Commission (CCRC) referred the cases of 42 former subpostmasters to the Court of Appeal last year, following a landmark High Court case against the Post Office.

Lawyers representing 42 former subpostmasters said evidence of serious defects in the Horizon system was “concealed from the courts, prosecutors and defence”, in order to protect the Post Office “at all costs”.

Protesters outside the Royal Courts of Justice (Photo: Yui Mok/PA Wire/PA Images)

Lord Justice Holroyde said the Court of Appeal had concluded that, in those three cases, “the reliability of Horizon data was not essential to the prosecution case and that the convictions are safe”.

Announcing the court’s ruling, Lord Justice Holroyde said the Post Office “knew there were serious issues about the reliability of Horizon” and had a “clear duty to investigate” the system’s defects.

But the Post Office “consistently asserted that Horizon was robust and reliable”, and “effectively steamrolled over any subpostmaster who sought to challenge its accuracy”, the judge added.

However, three of the former subpostmasters had their appeals dismissed by the court.

Former post office worker Noel Thomas, who was convicted of false accounting in 2006, celebrates with his daughter Sian outside the Royal Courts of Justice (Photo: Yui Mok/PA Wire/PA Images)

What is Horizon?

Horizon was introduced in 2000, and from then onwards unexplained discrepancies and losses began to be reported by subpostmasters.

In 2013, the system was being used by at least 11,500 branches, and was processing some six million transactions every day.

The Post Office maintained that Horizon was "robust", and that none of the shortfalls or discrepancies in subpostmasters' branch accounts were due to problems caused by the system.

Subpostmasters unwilling or unable to make good the shortfalls were sometimes prosecuted by the Post Office's in-house prosecution team for theft, false accounting and/or fraud on IT evidence alone, without proof of criminal intent.

Despite this, some subpostmasters were successfully persuaded by their own solicitors to plead guilty to false accounting on being told the Post Office would drop theft charges.

Once the Post Office had a criminal conviction, it would attempt to secure a Proceeds of Crime Act Order against convicted subpostmasters, allowing it to seize their assets and bankrupt them.

Some of the subpostmasters have since died, “having gone to their graves” with convictions against their name, while “some took their own lives”, the Court of Appeal was told.

What was the Court of Appeal’s ruling?

In the Court of Appeal’s written ruling, Lord Justice Holroyde said Post Office Limited (POL) “knew that there were problems with Horizon”.

The judge added: “POL knew that subpostmasters around the country had complained of inexplicable discrepancies in the accounts.

“POL knew that different bugs, defects and errors had been detected well beyond anything which might be regarded as a period of initial teething problems. In short, POL knew that there were serious issues about the reliability of Horizon.”

Lord Justice Holroyde continued: “Yet it does not appear that POL adequately considered or made relevant disclosure of problems with or concerns about Horizon in any of the cases at any point during that period.

“On the contrary, it consistently asserted that Horizon was robust and reliable. Nor does it appear that any attempt was made to investigate the assertions of subpostmasters that there must be a problem with Horizon.

“The consistent failure of POL to be open and honest about the issues affecting Horizon can, in our view, only be explained by a strong reluctance to say or do anything which might lead to other subpostmasters knowing about those issues.”

What has the Post Office said?

In a statement after the ruling, Post Office chairman Tim Parker said: “The Post Office is extremely sorry for the impact on the lives of these postmasters and their families that was caused by historical failures.

“Post Office stopped prosecutions soon after its separation from Royal Mail a decade ago and has throughout this appeals process supported the overturning of the vast majority of convictions.

“We are contacting other postmasters and Post Office workers with criminal convictions from past private Post Office prosecutions that may be affected, to assist them to appeal should they wish.

“The Post Office continues to reform its operations and culture to ensure such events can never happen again.”

Nick Read, Post Office chief executive, said: “I am in no doubt about the human cost of the Post Office’s past failures and the deep pain that has been caused to people affected.

“Many of those postmasters involved have been fighting for justice for a considerable length of time and sadly there are some who are not here to see the outcome today and whose families have taken forward appeals in their memory. I am very moved by their courage."

On 13 April, Read announced that the Horizon system will be replaced with a new, cloud-based IT system.

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