Post Office had deal with Fujitsu to fix Horizon errors 19 years ago
The Post Office and Fujitsu reached an agreement 19 years ago to correct processing errors in sub-postmasters’ accounts caused by errors in the Horizon IT system, a document has revealed.
An agreement was made in 2006 for the Post Office to pay up to £150 per transaction to fix errors caused by bugs in the software, or if Fujitsu failed to do so.
This statement directly contradicts the Post Office’s claims that there were no errors during the criminal prosecutions, which led to hundreds of wrongful convictions and livelihood-destroying civil lawsuits, that could have caused the accounting shortfalls.
This also shows that the Post Office knew almost two decades ago that Horizon could not always be trusted to record transactions accurately.
Between 1999 and 2015, more than 900 assistant postmasters were wrongly sued after a faulty Horizon IT system caused branch accounts to appear to have no funds.
While some deputy postmasters went to prison, many more were financially ruined and lost their livelihoods. Others died.
This has been described as the greatest miscarriage of justice in British legal history and led to a lengthy public inquiry into the scandal.
Countless evidence and testimony were heard, reviewed and reported during the investigation, but a document revealed in material published this month contained new, previously unknown information.
The document shows that, unbeknownst to the subpostmasters, the two parties had a financial framework in place to manage the discrepancies and for Fujitsu to resolve the problems or pay.
Throughout the criminal trials against deputy postmasters, the Post Office has denied the claim that mistakes or errors could have caused transaction deficiencies in branch accounts. In addition, the court rejected the claim that branch accounts could be changed remotely without the knowledge of sub-postmasters.
Document It states that official business regulation is prepared to deal with possible mismatches or “inconsistencies” and that, where the Fujitsu system is responsible, it is expected to correct wrongful transactions or pay “liquidation damages”.
The statement also refutes the Post Office’s 2015 claim to the media and Parliament that it was not possible for Fujitsu to change the operations of sub-postmasters without their knowledge.
“The Post Office pursued both the criminal proceedings against the postmasters and the 2019 class action on the basis that it knew of no significant problems with the Horizon system,” said Paul Marshall, senior attorney for the sub-postmasters.
“However, this shows that there was a very large and known problem in 2006 in Horizon maintaining data integrity between Post Office branches and Fujitsu,” he added.
“The Post Office has been saying for 20 years that the only explanation for deficiencies in branch accounts was incompetence or dishonesty on the part of the postmaster.
“However, preserving data integrity was fundamental to the Post Office-Fujitsu agreement; Fujitsu was unable to provide or guarantee this.”
The document tacitly acknowledges that data held on Horizon servers at Fujitsu’s headquarters may fail to match transactions carried out by subpostmasters at their branches.
This also adds to evidence that the Post Office was aware that sub-postmasters’ branch accounts could be accessed remotely. For example, in the groundbreaking Alan Bates vs Post Office case, the organization insisted that the software could not be accessed remotely by any other party.
Under the arrangements outlined in the document, Fujitsu agreed to carry out a “reconciliation service” with the approval of the Post Office where necessary. correct errors resulting from errors or defects, or pay up to £150 per transaction with penalties known as “pecuniary damages”.
The document dates from four months before the Post Office launched proceedings against deputy postmaster Lee Castleton OBE to recover £25,000 in cash which he claimed was lost at its branch in East Yorkshire.
He represented himself in court, arguing he was responsible for the problems with Horizon, but lost and faced £321,000 in legal fees and went bankrupt as a result.
Mr Castleton is now suing the Post Office and Fujitsu for damages and said the document would help his fight.
He told the BBC: “This is a disgusting document. Another example of the truth being hidden for two decades. The suffering and punishment the victims have endured for so many years have been buried.”
“It makes me physically sick to think that they did this and didn’t tell anyone…it’s time they were held accountable for all of these actions.”
The document, first discovered by Post Office scandal campaigner Stuart Goodwillie, backs up what whistleblower Richard Roll told BBC Panorama in 2015.
The former Fujitsu employee said the team working on Horizon sometimes corrected thousands of transactions per night because if the firm did not do so it could have to pay cash to the Post Office.
The agreement also states that Fujitsu can and will modify transaction data provided the post office approves the entries. A later version of the contract has been found in which this requirement was changed to “wherever possible”.
The document is listed as an appendix to two corporate witness statements provided by Fujitsu’s current European CEO, Paul Patterson, in 2024 but has only just been published.
The material document shocked experts on the scandal, such as Second Sight forensic accountant Ron Warmington, who described the document’s implications as “dynamite.”
A Fujitsu spokesman said: “These matters are the subject of a criminal investigation being carried out by the Post Office Horizon IT Investigation and it is inappropriate for us to comment while this process is ongoing.”
A Post Office spokesman said: “We publicly apologize for the pain and suffering the Post Office has caused so many people during the Horizon IT Scandal.
“Today, our organization is focused on working transparently with the ongoing public inquiry, providing full and fair financial compensation to those affected, and establishing a meaningful restorative justice program – all important elements of the Post Office’s ongoing transformation.”
