Post Office handed out bonuses for convictions
Cash incentive to prosecute sub-postmasters revealed as PM vows to exonerate all victims
POST OFFICE investigators were offered cash bonuses for every subpostmaster convicted during the Horizon scandal, it has emerged.
Alan Bates, the sub-postmaster who led the campaign for justice, last night joined a deluge of criticism over the practice, saying offering financial incentives for prosecutions was “appalling” and highlighted the “horrendous” culture of the Post Office.
Investigators with the Post Office described the incentive scheme as “part of the business”, with everyone in the security team “on a bonus”.
Gary Thomas, who worked in the Post Office security team between 2000 and 2012, told the Post Office Horizon inquiry that the bonus targets affected how he went about his work. Mr Thomas also branded all sub-postmasters “crooks” in emails concerning one victim who was posthumously cleared. The messages were handed to the inquiry, which resumes today.
Mr Bates, who is the central character in ITV’S Mr Bates vs The Post Office and has been backed by Downing Street to receive a knighthood, said last night: “The Post Office seems to have a bonus culture running right through it.”
On another day of developments in the long-running scandal, Rishi Sunak yesterday pledged to introduce a law that would exonerate sub-postmasters, with an ambition to quash all convictions this year. In exchange for signing a document declaring their innocence, sub-postmasters will receive £600,000 compensation – though some victims said the sum was insufficient recompense for their suffering.
The Crown Prosecution Service (CPS) also disclosed for the first time yesterday that it had prosecuted sub-postmasters while Sir Keir Starmer, the Labour leader, headed the organisation. While the vast majority of prosecutions were conducted by the Post Office, the CPS revealed details of a number of cases involving the defective Horizon IT system. Sir Keir said none of the cases had come across his desk.
It also emerged that Fujitsu, the Japanese firm at the heart of the scandal, has been awarded £4.9billion of government contracts since a 2019 legal ruling that found its software was at fault. Ministers insisted yesterday that they had attempted to block the firm from securing government contracts but were stymied by procurement rules.
Last night, the Justice Secretary said that while the Post Office’s actions had been deemed “unconscionable”, Fujitsu could also be forced to compensate taxpayers if it is found to have been culpable in the scandal. “Bluntly, if the scale of the incompetence is as we might imagine, we would want to secure proper recompense,” Alex Chalk told ITV’S Peston, adding that he was “absolutely” talking about Fujitsu but did not want to presume its guilt.
Separately, it was alleged that Adam Crozier, who was chief executive of Royal Mail between 2003 and 2010, would have been aware of the defective Horizon system. He said he had “no involvement” with it.
The faulty Horizon software in post offices recorded false losses on branch accounts, which resulted in more than 900 sub-postmasters being prosecuted between 1999 and 2015.
Mr Thomas, of the Post Office security team, told the inquiry there were “bonus objectives” available to his colleagues, including a 40 per cent “loss recovery objective”. Asked if that influenced his behaviour as an investigator, he said: “I’d probably be lying if I said no because… it was part of the business, the culture of the business of recoveries or even under the terms of a postmaster’s contract.”
In an email sent by Mr Thomas in 2021 to Nick Read, the Post Office’s chief executive, and which was disclosed to the inquiry, he wrote: “My yearly objectives that were bonus worthy at the time were based on numbers of successful
prosecutions and recovery amounts of money to the business.”
He also discussed “a proceeds of crime unit within Post Office Ltd that ensured some of these individuals lost their homes and families”.
Mr Thomas was the lead investigator in the case of sub-postmaster Julian Wilson, who was convicted of false accounting but died of cancer five years before his conviction was overturned. Mr Thomas did not include any of the problems Mr Wilson had reported with the Horizon system when writing his report after interviewing him in 2008.
Years later, Mr Thomas told a colleague he was “pleased” to have his hands on documents relating to Mr Wilson’s case because he wanted to prove there was “no ‘Case for the Justice of Thieving Subpostmasters’” and that they “were all crooks”.
In comments likely to upset campaigners, Mr Thomas said that while compensation was being “correctly awarded now to these sub-postmasters, I feel the employees instructed to conduct these prosecutions, arrests and searches have been completely overlooked”.
Dave Posnett, another senior post office investigator, last month said in his evidence to the inquiry that colleagues were given annual bonuses partly based on the amounts of money his team recovered under the Proceeds of Crime Act — orders to seize sub-postmasters’ assets once they had been convicted.
Asked if all financial investigators were on a bonus scheme, Mr Posnett replied: “Yes, and everyone within the security team was on a bonus, depending on their own objectives.”
In addition, a further 34 senior executives – including Mr Read, the current chief executive – were paid bonuses to cooperate with the public inquiry conducted by Sir Wyn Williams. Mr Read was forced to hand back part of his £450,000 bonus after it emerged.
Mr Bates said: “I think sometimes the bonuses outstrip the wages. It’s pretty appalling. It’s horrendous. There seems to be a culture in it and that’s got to be called into question at some point.”
Marion Holmes, 82, the widow of Peter Holmes, a Post Office manager convicted of theft and who died in 2015, five years before he was cleared of any wrongdoing, said: “It [the bonus scheme] doesn’t surprise me because it’s the sort of thing they would do. They can’t stoop any lower, they really can’t in my eyes. The tactics they used were horrendous, and that just says it all doesn’t it? That really is the lowest of the low as far as I am concerned. I have got steam coming out of my ears.”
Lord Arbuthnot, the former Tory MP who fought for justice for the sub-postmasters, said: “Offering investigators incentives on the basis of asset recovery rather than doing justice is completely unacceptable and I am sure it will be looked at in detail at the public inquiry.”
Kevan Jones, the former Labour minister, said: “This is another damning revelation around how the Post Office weaponised the legal system against these postmasters.”
The Post Office said the bonus scheme was being rightly investigated by the public inquiry. A spokesman said: “We share fully the aims of the public inquiry to get to the truth of what went wrong in the past and establish accountability.
“It’s for the inquiry to reach its own independent conclusions after consideration of all the evidence on the issues that it is examining.”
Today, Stephen Bradshaw, a Post Office investigator, is due to appear in front of the public inquiry.
‘Because I want to prove that there is Ffffiiinnn no “Case for the Justice Of Thieving Sub Postmasters” and that we were the best Investigators they ever had and they were all crooks !!’