1 Friday, 12 May 2023 2 (10.00 am) 3 RODERICK MARK ISMAY (continued) 4 Questioned by MR BEER (continued) 5 MR BEER: Good morning sir, can you see and hear me? 6 SIR WYN WILLIAMS: Yes, I can, thank you. 7 MR BEER: Thank you very much. 8 Good morning, Mr Ismay. Can we pick up 9 where we left off last night with the email 10 chain that we were looking at before the 11 technology failed us. It was POL00055100. 12 Thank you. 13 Just to refresh your memory, because it was 14 last night, on the second page of this document 15 you'll remember that the defence solicitor, Issy 16 Hogg, had set out three requests. That had 17 worked its way through to Jarnail Singh, we can 18 see from the top of the page, and then we go to 19 page 1 at the bottom. We can see that, on 20 behalf of Jarnail Singh, that email was 21 forwarded to Mr Longman and counsel, Mr Tatford, 22 and we look at the top of the page, we can see, 23 the second email down, Mr Winn, who receives the 24 chain, replies to Mr Longman: 25 "Rod Ismay, the head of P&BA, is not happy 1 1 at the prospect of an open-ended invite. He has 2 asked the question of what are the legal 3 parameters we're working with. Simplistically, 4 if we refuse or impose conditions do we lose the 5 case? I think we need more guidance on how 6 something like this might reasonably operate." 7 I had asked you about what Andrew Winn 8 himself had said concerning this email chain, 9 and he told the Chairman that he understood your 10 reply was a reply that was seeking to close down 11 the closure request as much as possible and 12 I asked you whether that was your intention. 13 You said last night: 14 "No, there were two things here: you would 15 expect the Criminal Law team to be overseeing 16 the compilation of whatever needed to be 17 submitted, and not for there to be a side 18 conversation between me, as part of the 19 organisation, with the defence lawyer. So 20 I felt that the request should be coming to me 21 from the Criminal Law team." 22 Just dealing with that answer first, the 23 request was coming from the Criminal Law team. 24 A. It was coming indirectly from the Criminal Law 25 team. I was surprised that Jarnail -- I would 2 1 have -- given the importance of the matter, 2 I would have expected Jarnail to have been 3 directly in contact and, because the request was 4 specified by the defence, which may well have 5 been a very valid request to make, but I would 6 have expected the Post Office Criminal Law team 7 to have been the ones explicitly saying to me 8 this -- "Can you do this, Rod?" which, of 9 course, I would have responded to. 10 You have shared an email that was on the 11 screen, a couple of screens ago, I think it's 12 got a phrase in it that says, "Jarnail, please 13 send me your instructions". I find that kind of 14 a puzzling phrase, it's not like "Jarnail, we've 15 agreed and you have agreed that Mr Ismay should 16 provide certain things". It says, "Please 17 advise me of your instructions", and that to me 18 sounds like "Well, there's some discussion going 19 on here". 20 So I think when Andy Winn was at the hearing 21 he did say what you've said and, before that, 22 I think he said, "I know Rod, I think he would 23 have been seeking clarification", he perhaps 24 didn't understand the question. And then when 25 you asked him the question again he proceeded, 3 1 as you said, exactly as you said earlier. 2 But I was seeking clarification because 3 I was surprised not to be being approached by 4 Post Office Criminal Law team and I certainly 5 didn't think that -- didn't feel appropriate to 6 me to be engaging in direct correspondence with 7 the defence team. I would have absolutely 8 expected the Post Office criminal lawyer to 9 specify what was needed to gather that from me, 10 or to facilitate any visits that were necessary, 11 and for that to be managed through a single 12 point of contact who was acting on that case. 13 That was absolutely the fundamental reason for 14 it. 15 Andy -- Andy's notes also said "Rod wasn't 16 happy", so I think that's the first reason and 17 yesterday I said there were going to be two 18 reasons I wanted to expand on. Firstly, was 19 what -- was that, the approach of, I believe, 20 the Criminal Law team involvement. The second, 21 I think was just that, of course I wasn't happy 22 about another review, yes, because at the time 23 we were gearing up for Royal Mail privatisation, 24 I've got lean process improvement reviews being 25 done in my team, I've got business 4 1 transformation projects going on, which entailed 2 sensible process reviews in different teams. 3 But I was feeling a bit like my team was 4 constantly subject to review and, therefore, 5 this, which, if Jarnail agreed it was necessary, 6 was an absolutely important review that I should 7 facilitate but Jarnail hadn't told me that and 8 I was already on the receiving end of a number 9 of active reviews for business process 10 improvement purposes, which were proving very 11 demanding in my team. 12 So I wasn't happy about the idea of another 13 review but, if Jarnail came and said, "Rod, this 14 is what the Post Office Criminal Law team feel 15 needs doing", then absolutely I would have 16 followed that. But I hope that gives the 17 context as to why Andy perceived that I wasn't 18 happy at the request there. 19 Q. That reason, that you weren't happy with the 20 process being followed, that the criminal law 21 team should give instructions to their client, 22 you, as to as though what examination should or 23 should not be permitted didn't find its way into 24 this email chain, did it? 25 A. No, the -- 5 1 Q. The process issue? 2 A. I don't think a clear instruction from our 3 Criminal Law team to me came to me to say what 4 to do. I was copied in on an email that you've 5 shared there that says, from the defence 6 solicitors, "We await your instructions". Well, 7 I don't know what that means. 8 Q. Well, hold on, if we look at the foot of the 9 page, please, the email at the bottom. Jarnail 10 is asking Mr Longman -- who worked for you? 11 A. Yeah, yeah -- no, he didn't at that time. 12 Q. Who did Mr Longman work for at this time? 13 A. Jon, I think, would have been part of the 14 Security team. 15 Q. They weren't within your area of responsible by 16 this time? 17 A. No, and, in terms of the Security team, the 18 investigations part of the Security team had 19 been part of my remit in 2005 for about a year. 20 There's another whole part of Security but -- 21 Jon was not part of my team, no. 22 Q. Why did this come through to you, then, to your 23 team? 24 A. So Jon -- well, I think that Issy Hogg's request 25 on the further down below, page 2 or 3 of this 6 1 document, I think her request was for access to 2 systems in the Midlands. Yeah. So that would 3 have meant Chesterfield, I think. That would 4 have meant the Product and Branch Accounting 5 Team and, therefore, if Jarnail has passed this 6 to Jon, Jon had come to the right area to ask 7 a question, but the nature of the whole question 8 didn't feel like the Post Office Criminal Law 9 team coming and saying, "We are leading the 10 collation of the response in this case and Rod, 11 within the construction of Post Office Limited's 12 defence pack -- Post Office Limited's 13 prosecution pack -- please can you facilitate 14 this?" 15 I was receiving something third hand 16 suggesting that I should agree to something with 17 a defence solicitor which I -- my perception is 18 that that wouldn't be how a case would be 19 handled. There would be a -- the law team in 20 the Post Office would manage the relationship 21 between the two law teams. 22 Q. Just scrolling up to Mr Singh's email at the 23 foot of the first page, thank you. He says in 24 the second line: 25 "Could you please be kind enough to let me 7 1 have your urgent instructions as to the access 2 and information she is requesting." 3 That's a perfectly normal request, isn't it, 4 from a lawyer to their client? 5 A. Well, it might be in legal language but, to me, 6 to say, "Let me have your urgent instructions" 7 could be "Are you instructing me to do something 8 or not?" That is not language that means 9 something to me as a non-lawyer, "your urgent 10 instructions". 11 Q. Mr Winn told the Chair that the reasons that you 12 gave for wishing to shut down as much as 13 possible this disclosure request were that, 14 firstly, you believed the examination wouldn't 15 produce anything, ie the defence examination 16 sought wouldn't produce anything; and, secondly, 17 it would create more questions than it would 18 answer. Is he correct that those were the 19 reasons that you gave for not wishing to allow 20 the defence the access to the systems that they 21 sought? 22 A. The reasons -- so that and the other two reasons 23 that I've given already, yes. So, given that 24 the allegations were being made about the 25 Horizon System, the idea of doing a review in 8 1 the Product and Branch team, who were not using 2 Horizon, would seem to me to not have been 3 looking at the particular system that 4 allegations were made about and, therefore, 5 would have continued to have questions after 6 that review because we wouldn't have been able, 7 in my team in Chesterfield, to have shown or 8 answered questions about the Horizon System. 9 Q. The request, if we go to the second page, 10 concerned access to the system in the Midlands. 11 A. Right, okay. 12 Q. Secondly, it concerned access to the operations 13 centre in Chesterfield. 14 A. Right, yeah. 15 Q. Thirdly, it sought access to system change 16 request, Known Error Log, new release 17 documentation, to understand what problems have 18 had to be fixed. It was a broader request than 19 simply access to systems in Chesterfield, wasn't 20 it? 21 A. That was a broader question than Chesterfield 22 systems because, to the best of my knowledge, 23 the Known Error Log, I think, was a phrase about 24 Horizon Issues. I think if the SAP system that 25 my team used, if it had an issue, I don't think 9 1 that would have been called a Known Error Log 2 item. So I think that third bullet point reads 3 to me as being a Horizon-related topic. 4 Q. Putting it bluntly, Mr Ismay, was the real 5 reason that you didn't wish to give access that 6 you were concerned that this might be another 7 form of independent review, exactly the type of 8 independent review or examination that you and 9 your colleagues within the Post Office did not 10 want to happen? 11 A. No. No. It wasn't. And I think there's 12 something that's referred to in one of the other 13 documents in the packs but, somewhere in the 14 chain of events around this time, we had -- the 15 Post Office had a conversation, I'm not sure 16 with who, when I say "we", somebody in the Post 17 Office had conversations with subpostmaster 18 representatives which had led to a small working 19 group of subpostmasters, active subpostmasters, 20 coming and looking at some of the things in 21 Chesterfield, so I recall a number of meetings 22 where, I think, four subpostmasters came in. 23 And I think it was related to the Second Sight 24 process and, therefore, I'd already had a kind 25 of a scenario of very helpfully having 10 1 a dialogue with subpostmaster colleagues in 2 Chesterfield. 3 Q. When was the Second Sight process? 4 A. In respect of this timeline -- 5 Q. Later. 6 A. Right, okay, yes, I'm sorry. 7 Q. By years? 8 A. Yes, I'm sorry, that would have been later, I'm 9 sorry, yes. 10 Q. Inviting four postmasters into Chesterfield 11 a couple of years later, not really the same as 12 allowing an expert access to a system and access 13 to documentation to understand any errors or 14 bugs within it, agreed? 15 A. Yeah, I agree that and I'm sorry about -- with 16 all the things that I was involved in, I'm sorry 17 that I've mixed up the timeline there. 18 Q. Was your concern here that an independent 19 investigation may show that there were issues of 20 unreliability with Horizon? 21 A. No, no, my concerns were about the centrality of 22 the Criminal Law team to lead on the dialogue 23 here. My concern was, I suppose, a workload 24 thing of how many reviews my team were already 25 involved in, with different people coming to 11 1 review processes in my team, and that 2 fundamentally was why I -- my chin would have 3 dropped at the prospect of another review in the 4 team. 5 Q. If we go back to the first page, please, we can 6 see that Mr Winn's email in the middle of the 7 page reporting his conversation with you is 8 dated 27 July 2010. 9 A. Right. 10 Q. So the conversation to which it refers 11 presumably would have occurred whilst you were 12 writing your report, remembering your report's 13 final version has a date of 2 August on it. So 14 it's within the same week. 15 A. Yeah, it probably is, yeah. 16 Q. Did the fact that you were being asked by the 17 managing director of the company to write 18 a report that gave Horizon a clean bill of 19 health influence your decision not to allow, at 20 the same time, an independent defence expert 21 access to the system? 22 A. No, and I think I'd just like to expand on the 23 no there. So I think my reason was the two 24 things that I've referred to a number of times, 25 about Criminal Law team and the number of 12 1 reviews in my team. I think, actually, you've 2 helpfully pointed out to me that this was in the 3 week before my other report summation was dated, 4 which I'd forgotten. So I think, given that 5 I was -- described yesterday that I was burning 6 the midnight oil to collate the report for David 7 Smith, I think that would probably be another 8 reason why a request coming in for a review in 9 Chesterfield at the same time as I was burning 10 the midnight oil on that other report would be 11 another reason for me coming across not happy at 12 the prospect of an open-ended invite. 13 Q. Does the fate of a defendant and their request 14 for access to a computer system turn on how 15 tired you were? 16 A. No, it certainly doesn't but I think it turns on 17 what the Criminal Law team sued be collating for 18 the Post Office and asking me to gather, not for 19 me to have a relationship directly with the 20 defence team. I think -- I'm sure the situation 21 for the defendant in this case is awful and I'm 22 really sorry for all the chain of events that's 23 happened here. This is horrible. But in 24 a legal process, my understanding is that the 25 Criminal Law team and the Post Office lawyers 13 1 should be the representatives facing the defence 2 solicitors and that they, the Post Office 3 solicitors, should be gathering the information 4 not for ad hoc individuals around the 5 organisation to be initiating separate 6 conversations, separate to a law team, who were 7 trying to contain -- trying to compile 8 a consistent and comprehensive pack. 9 Q. Nobody is asking you to have contact with the 10 defence solicitors. Nobody is asking you to -- 11 A. They are. They're asking me to accept 12 an open-ended invite of somebody coming to 13 Chesterfield. 14 Q. They're asking for your instructions, something 15 lawyers do to their clients every day of the 16 week. 17 A. Well, I think I've explained that that phrase of 18 asking instructions doesn't mean anything to me. 19 That is not a phrase that I am familiar with. 20 Asking your instructions leads me to think 21 "Well, my instruction is: go and ask the 22 Criminal Law team to come back and tell me what 23 the Post Office team think I need to provide". 24 Q. Can we turn on, please, to POL00055225. Thank 25 you. 14 1 Just remembering the chronology: that last 2 exchange ended on 27 July; your report, 3 2 August. 4 A. Yeah. 5 Q. We're now on 13 September. 6 A. Okay. 7 Q. Still dealing with, in the subject line there, 8 the Seema Misra case. 9 A. Yes. 10 Q. We can see this is an email from Zoe Topham, the 11 Former Agents Debt section within the Post 12 Office, to Mr Longman. You're neither a sender 13 or a recipient of it but you'll see, in 14 a moment, were referred to. 15 A. Yes. 16 Q. You'll see it says: 17 "Hi Jon 18 "The last update I had above was in July, 19 the Defence Solicitors had requested that they 20 had access to the operations in Chesterfield. 21 This was discussed by Andy Winn/Rod Ismay. 22 I have today spoken with Andy Winn and he has 23 informed me that Rod had made a decision not to 24 allow this ... could you ... update me with the 25 latest progress on the case." 15 1 You saw from the last email that it was said 2 that you weren't happy and you were asked 3 a couple of questions. In the interim, had you 4 made a decision, as this email records, that you 5 would not allow the access sought? 6 A. I don't think so. I think if the Post Office 7 defence team -- no, if the Post Office 8 prosecution team had come and said that 9 something needed doing, I would have absolutely 10 have followed it. I have got no idea what other 11 conversations, if any, happened after the one 12 that's referred to in the July chain and up to 13 this one. I can't remember the things and it's 14 quite possible that this email was just 15 reiterating that feelings that came out from the 16 conversation before. I don't -- genuinely don't 17 know whether I had another conversation in 18 there, but I was not in a position to be able to 19 say what should or should not happen in respect 20 of information gathering for a prosecution case. 21 It was absolutely for the Post Office solicitors 22 to say what needed to happen. I could not make 23 a decision like that. And I would have thought 24 that, if I had attempted to do something like 25 that, the Post Office solicitors would have 16 1 overruled me. So -- 2 Q. Would have? 3 A. Overruled me. So I would not have been in 4 a position to make a decision about -- if 5 a matter was agreed between the prosecution team 6 and the defence team to say that something 7 should happen, then that would not be something 8 for me to make a decision on. That would be 9 something for me to deploy. 10 Q. Can we move forward, please, to POL00055418. 11 An email principally between lawyers, Mandy 12 Talbot to Jarnail Singh, but copied to you, 13 dated 8 October 2010. So this is a few months 14 after you've written your report, a few months 15 after those email exchanges -- 16 A. Yes. 17 Q. -- that we've looked at. 18 A. Yes. 19 Q. This is the Friday before Seema Misra was due to 20 go on trial on the Monday morning. 21 A. Okay. Right. 22 Q. You'll see that Mandy Talbot emails Jarnail 23 Singh and says: 24 "Mike and Rod are also very interested in 25 any developments at the trial next week which 17 1 impact on Horizon. You promised to let me know 2 if anything unfortunate occurred in respect of 3 Horizon. Please can you copy Rod and Mike into 4 any messages. Incidentally I assume you have 5 briefed external relations. Can you let us know 6 who you have briefed because Mike and Rod may 7 wish to have input into any story relating to 8 Horizon. They may give you a call ... for 9 an update. Incidentally Postmasters for Justice 10 met with the Minister this week and were 11 accompanied by Issy Hogg and the lady from 12 Shoosmiths." 13 You were evidently interested in public 14 relations here because you are recorded as 15 having a possible interest in inputting into 16 a story about Horizon; is that right? You 17 wanted to be part of the story making for 18 Horizon? 19 A. No, I didn't want to be part of the story 20 relating to Horizon. Let me add some more 21 things to that. So Mandy's written an email 22 here, this isn't an email from me that says I'm 23 interested in writing a story. However, given 24 that I'd been asked by Dave Smith only a month 25 or so earlier, or two months earlier, to collate 18 1 that report to Dave Smith, where he was asking 2 for positive reasons to be assured about 3 Horizon, obviously this would be very much in my 4 mind. 5 There's been several bits of correspondence 6 you've shared about this case so this very case 7 was very much in my mind. I'd just been asked 8 by the MD to produce that report and, therefore, 9 it was probably in my mind at the time, "Well, 10 maybe Dave might ask me to collate something 11 else", and therefore I would want to be aware of 12 any progress on something that was going on, 13 given that the MD had very recently asked me to 14 do a report on that. 15 So I would think that what I've just said 16 would be the reasons why I would have had 17 an interest in it, given that obversely, there 18 was a lot of press analysis of it, then, from 19 Mandy's point of view, she would be aware there 20 was lots of press in and may have conflated me 21 thinking about press with me thinking about 22 having written a report to the managing 23 director. 24 So I would -- that is what I think my 25 interest would have been that would have caused 19 1 me to have been on the radar for being keen to 2 have updates on the outcomes of the case, having 3 so recently done that summation compilation for 4 Dave Smith. 5 Q. Or was it that, so long as nothing unfortunate 6 happened at the trial, you saw it as 7 an opportunity to minimise any bad press and go 8 on the front foot and put a story out? 9 A. No. So, as you've just said, "or was it 10 an opportunity", and it wasn't, I think, that it 11 was for the reasons that I've stated before 12 that. That was my rationale, not for that other 13 opportunity. 14 Q. Was it that, by now, you had become one of the 15 key figures within the Post Office who was 16 a leader on defending the integrity of the 17 Horizon System. Having written your report, you 18 were going to be the flag bearer, or one of 19 them, for the integrity of the Horizon? 20 A. I think I was clearly seen as somebody who was 21 able to talk to other -- lots of parts of the 22 organisation to pull together a summary related 23 to this situation. I think it -- I asked 24 myself, looking back at it, I was managing the 25 Product and Branch Accounting Team which was 20 1 inherently very close to subpostmaster and other 2 Post Office transactions, but I was not in 3 charge of the Horizon System. 4 So I do ask myself several times "How on 5 earth was it that I ended up being the one who 6 was invited to collate this report?" And 7 I think that was because I had got a decent 8 understanding of lots of stuff across the 9 organisation but, frankly, why wasn't it an IT 10 person who collated that report about a system? 11 I don't know. It was me. Dave came to me to 12 ask me to do it. 13 So, yes, I'm clearly somebody who had got 14 a level of understanding about the Horizon 15 System, a level of understanding about 16 transactions in branches. I'd got relationships 17 with a number of, if you like -- I think we 18 talked about the NFSP meetings, and things, and 19 some other materials. So there's lots of 20 activity where I was meeting people to try to 21 look through the eyes of subpostmasters. 22 And I realise a phrase, such as I've just 23 used then, you might rightly, and some other 24 people may say "Well, that's in awful phrase to 25 use, given the awful events that we've got 21 1 here", but I was very much trying to do that in 2 my role and that probably made me, as a back 3 office finance person, sound unusually keen on 4 understanding things at the front end because 5 I was passionate about Post Office, as I was 6 passionate about -- that's why I joined the Post 7 Office in the first place. 8 This was an organisation right at the heart 9 of the community, part of the national interest. 10 The previous Finance Director had described it 11 as -- something about Post Office is fundamental 12 to social cohesion. 13 Me, I was humbled to have the opportunity to 14 work at the Post Office and I'm horrified that 15 all these events have happened and that I'm in 16 here talking in this situation of this awful 17 chain of events that's happened here. But, yes, 18 in the Post Office, I think I was recognised as 19 somebody who'd got a significant amount of 20 understanding of things to comment on. 21 But it mystifies me sometimes, looking back 22 at it, just to think that why was it that me, 23 managing a back office finance team, was the 24 person asked to collate some of these things, 25 and to be answering questions about a system 22 1 that I did not own, and which, when we've had -- 2 at the end of my witness statement, asked for 3 other reflections on things for the past, I made 4 a comment about I think moving forward it would 5 be really important for the organisation to be 6 clear about the individuals who are the owners 7 of systems in the organisation, because I think 8 structurally it would be quite clear, I was 9 managing a back office finance team. That would 10 not be the owner of the Horizon System. Why, 11 therefore, were so many things coming to me? 12 And I know, across the whole of social media 13 there's a number of people referring to the 14 "Ismay report". Well, I collated something for 15 lots of people across the organisation. I'm 16 increasingly mystified, looking back, where were 17 IT in there? Why was it me that it was me that 18 was the collator of this? But I tried in the 19 best faith to do the best compilation of things, 20 and the best response to matters that were going 21 on, but was always of an understanding that 22 there was a lead from the Criminal Law team in 23 these. 24 Q. Rather than the reasons that you've given, did 25 you want to have an input into the story to set 23 1 the narrative relating to Horizon because you 2 were now seen as a pliant individual, a good 3 company man, who would deliver the goods by 4 producing a one-sided, unbalanced piece, and you 5 wanted to get that one-sided, unbalanced piece 6 out into the media? 7 A. No. As you say, is there another scenario and 8 was that the scenario? And no, and for the 9 reasons that I've articulated earlier, no. 10 Q. Who was Mike Granville? What role did he 11 perform? 12 A. Mike, his role was -- I know the kind of nature 13 of -- so he would have had a lot of contact with 14 BIS. I think his role title was probably 15 something like Stakeholder Relations. So he -- 16 I know he had a lot of discussions with 17 stakeholders, such as the NFSP, and I think some 18 of the departments for business and innovations 19 and skills, or its predecessors, I think he 20 would have had conversations with people in that 21 organisation, the shareholder organisation. 22 Q. Were you reporting back to any directors at this 23 time about Seema Misra case and your role in it? 24 A. I don't remember reporting to directors about 25 that. I don't know. But I also feel, whilst 24 1 there's a number of bits of correspondence we've 2 got here, I didn't have a -- there's clearly 3 some major correspondence here that refers to me 4 in the Seema Misra case but you've said me 5 being -- having a major role in the case, well, 6 I didn't. I wasn't doing a lot to do with this 7 case. I'd received a question, which is 8 a really important question which we've already 9 talked about, when I wasn't actually doing 10 anything. 11 I was continuing to be managing a back 12 office finance team, settling with clients and 13 gearing up for Royal Mail privatisation and 14 separation of Post Office functions, and this 15 case was going on, and I had these questions 16 that came to me, but I wasn't somebody who was 17 doing lots to do with the -- this case. And 18 I say that because that would be true of any 19 case. I wouldn't have been myself doing things 20 to do with the case. 21 Q. Can we turn on, please, to POL00044997. Can we 22 look at the email at the foot of the page, 23 please. Thank you. It's an email from Jarnail 24 Singh. You can see that it's rather strangely 25 formatted in the top right-hand corner -- 25 1 A. Yes, yeah. 2 Q. -- dated 21 October at 2.58 -- 3 A. Yeah. 4 Q. -- to a long list of people and, amongst them, 5 is you. 6 A. Yeah. 7 Q. The subject is "[The Crown] v Seema Misra -- 8 Guildford Crown Court -- Trial -- Attack on 9 Horizon", and Jarnail Singh wrote: 10 "After a lengthy trial at Guildford Crown 11 Court the above named was found Guilty of theft. 12 This case turned from a relatively 13 straightforward general deficiency case to 14 an unprecedented attack on the Horizon System. 15 We were beset with unparallelled degree of 16 disclosure requests by the Defence. Through 17 hard work of everyone, Counsel Warwick Tatford, 18 Investigation Officer Jon Longman and through 19 the considerable expertise of Gareth Jenkins of 20 Fujitsu, we were able to destroy to the criminal 21 standard of proof (beyond all reasonable doubt) 22 every single suggestion made by the Defence. 23 "It is to be hoped the case will set 24 a marker to dissuade other Defendants from 25 jumping on the Horizon bashing bandwagon." 26 1 You'll see the title to the email "Attack on 2 Horizon". You'll see in the second line, it 3 refers to an attack on Horizon and the claim 4 made that the Post Office was able to destroy 5 the defence allegations. Is that language 6 reflective of the culture prevalent at the time 7 concerning Horizon, namely, in response to 8 a defendant who maintained a defence to the 9 criminal charges of theft against her was 10 thereby seen as attacking Horizon, an attack 11 which needed to be destroyed? 12 A. I think that's unpleasant language to be using 13 and -- 14 Q. Presumably you replied along those lines? 15 A. I don't know. I'm looking at that now and 16 thinking that's unpleasant language. I don't 17 know what reply, if any, I made to that. 18 Q. So a defendant who deigns to suggest that the 19 computer system which is being used to convict 20 her is said to be mounting an unprecedented 21 attack on the system. Did you regard this as 22 an inappropriately gleeful email? 23 A. Well, I certainly do, looking at it as we have 24 here. I don't know what I thought at the time 25 but I'm looking at that thinking the subject 27 1 title shouldn't even have words like "attacking 2 Horizon" in the subject of it. It should have 3 simply been "[Case title] update", and I think 4 that's not nice -- that's unpleasant language to 5 have used. 6 Q. The last sentence: 7 "It is to be hoped the case will set 8 a marker to dissuade other defendants from 9 jumping on the Horizon bashing bandwagon." 10 No doubt that was a sentiment with which you 11 very much approved at the time? 12 A. I'd been involved in collating that thing about 13 the reasons to be assured about Horizon. 14 I would hope that I wasn't using language like 15 "Horizon bashing". I was focused on reasons for 16 integrity of the system and, clearly, there's 17 a number of things that have come out that are 18 contrary to the concept of integrity of it, for 19 language like "Horizon bashing" isn't -- well, 20 it is unpleasant language to use again. 21 Q. But this senior lawyer within the Criminal Law 22 Division has sent his email to quite a number of 23 the top slice of managers within the Post 24 Office, hasn't he? 25 A. Yes, some of the people in there are, yeah, 28 1 senior executive team, even. 2 Q. Wasn't that the culture of the time: If we get 3 a within like this, we should weaponise it to 4 dissuade anyone else from daring to suggest that 5 there's anything wrong with Horizon? 6 A. I don't sort of remember it as being a culture 7 of weaponisation but there was certainly 8 something you shared yesterday that was kind of 9 a similar tone to it and that was unpleasant. 10 So I can see that, as you lift a number of these 11 bits of correspondence, it does not sound like 12 an acceptable tone of voice. 13 Q. Do you know why Mr Singh would be concerned 14 about the need to deter others? 15 A. No. Mr Singh, I think, would be -- should be 16 concerned to have the right evidential objective 17 process going through cases. 18 Q. Yes. I'm asking you whether you would know of 19 any reason why a senior lawyer within Post 20 Office's Criminal Law Division would express 21 a wish, a hope, that the outcome of one case 22 would deter others from making suggestions about 23 the integrity of Horizon? 24 A. No. 25 Q. Did you know that prosecutors in criminal cases 29 1 are supposed to act as ministers of justice -- 2 A. Um -- 3 Q. -- meaning that they don't secure a conviction 4 at all costs, amongst other things? 5 A. That's not a phrase that I know, but it totally 6 makes sense to me. So what you are saying, 7 I would say, yes, I would agree with that. 8 Q. And that having a business-driven motive for 9 securing a win in a criminal case would be 10 inappropriate? 11 A. Yes. 12 Q. Is that what was going on here: that there were 13 business drivers here not wishing to let the 14 outside world know that there were problems with 15 the integrity of Horizon's data and that any 16 opportunity to dissuade anyone from questioning 17 the integrity of the system should be grabbed 18 with both hands? 19 A. No, and I'll just add to that sort of thing, no, 20 it shouldn't and I would like to think that it 21 wasn't being done in that way. But the 22 organisation, yes, the Post Office commercially 23 would want people to have got confidence in its 24 point of sale system because all of its commerce 25 clients, and its customers, and its 30 1 subpostmasters, and so many people had got 2 different roles of a large part of the UK 3 economic cash going through that organisation. 4 So there'd be lots of reasons why people 5 would want to be confident in the system but 6 when one gets down to the level of a specific 7 case in a branch, as you've said, that should be 8 done objectively. So there would be commercial 9 reasons to want to be assured about the system 10 but I would hope, and I would hope, that it was 11 actually being objectively done case-by-case. 12 So my answer to that is, yes, there's commercial 13 reasons but I would hope that they didn't 14 manifest themselves in the conduct of the case. 15 Q. Can we look, please, at POL00113909. If we just 16 look at the foot of page 1, please -- thank 17 you -- you'll see an email from Mandy Talbot to, 18 amongst other people, you. 19 A. Yeah, yeah. 20 Q. We're going back four years here to 2006 in the 21 Lee Castleton case? 22 A. Right. 23 Q. I just want to see whether this helps us in any 24 way with the answers that you've just given? 25 A. Yeah. 31 1 Q. So this is in the run-up to the trial. The Lee 2 Castleton case commenced its hearing in the High 3 Court on 6 December 2006 and this is 9 November 4 2006, so it's about a month before. 5 A. Yeah, yeah. 6 Q. You'll see that you're copied in. 7 A. Yes. 8 Q. In fact, the direct addressee. What had the Lee 9 Castleton case got to do with you? 10 A. Well, I don't know at that time. So I must have 11 left the -- I had the investigations team and 12 Branch Audit Team but I think I'd -- 13 Q. You'd moved on by now? 14 A. I'd moved on by then so I was in the Product and 15 Branch Accounting Team, so what that the 16 Castleton case got to do with me? So I don't 17 know whether we'd got a -- well, there was -- 18 well, there was probably a debt -- an alleged 19 debt arising at the start of this case that 20 would have been something, ultimately, that 21 either my Current Agents Debt team or Former 22 Agents Debt team would have had a role in. 23 Mandy may have included me on it because she 24 may have been used to including me on things in 25 my previous role. So many people change jobs so 32 1 many times that sometimes people in -- who have 2 moved on are still included on the previous 3 address list. But my team would have had -- 4 I would expect my team, Product and Branch 5 Accounting, would probably have been asked at 6 the branch audit to confirm if there were any 7 transaction corrections pending at the time. So 8 I imagine my team would have had a question 9 asked to them in the conduct of -- back at the 10 branch audit stage, and that may have led to me 11 being included on this. 12 Q. If we go over the page, please. There's a blank 13 page, sorry. Scroll down. Thank you. 14 I'm just going to give you some context here 15 by reading this: 16 "Our original claim against Castleton was in 17 the region of £25,000 and he entered a defence 18 and counterclaim for £250,000 but of more 19 concern brought the whole validity of the 20 Horizon System into question. As a result we 21 have expended a lot of legal costs to ensure 22 that the defence to those allegations is as 23 perfect as possible. 24 "On Friday Castleton's solicitors amended 25 their defence/counterclaim to reduce their 33 1 counterclaim to £11,000. 2 "Last night our barrister received 3 a compromise offer from Castleton's solicitors 4 probably brought on by the fact that they are 5 obliged to serve their statements on Friday 6 together with their accountants report. We 7 suspect that their accountants report has not 8 supported their claim. 9 "The bare offer is as follows: 10 "they offer the sum of £22,350 in settlement 11 of our claim 12 "our costs on the standard basis 13 "they want us to agree to pay rent or get 14 the temp to pay rent for the continued occupancy 15 of Marine Drive 16 "they want us to pay the wages of the 17 assistant employed there 18 "they want a letter from us stating that 19 proceedings were issued purely to recover a debt 20 and that there was no allegation of dishonesty." 21 She says: 22 "Firstly I think we can all agree that their 23 demand 3 and 4 cannot be accepted ..." 24 Skipping over: 25 "Secondly, as we have never pleaded that 34 1 Castleton was dishonest there is no problem with 2 us agreeing to this demand. We believe that he 3 is seeking to go back to work in the city and as 4 such a statement from us could be very valuable 5 to him. 6 "Thirdly the offer is defective in that it 7 does not mention interest ... 8 "... no offer has been made to give a 9 declaration to the effect that he withdraws all 10 his allegations about the Horizon System." 11 Then scrolling down: 12 "... we made a Part 36 offer to him in 13 January ... stating if you pay our full claim we 14 would not seek our costs which he rejected, he 15 is now applied to pay our costs on the indemnity 16 not the standard basis since that date. If 17 costs are awarded on the standard basis then 18 traditionally the successful party would recover 19 between 60-65% of the costs expended. Any 20 dispute is resolved in the favour of the paying 21 party. Costs on the indemnity basis means one 22 recovers almost all of ones costs and any 23 dispute is resolved in favour of the receiving 24 party. So there is quite a difference between 25 the two. 35 1 "Sixthly the reason given for not paying the 2 full amount of the claim is spurious as we have 3 demonstrated to them on a number of occasion 4 that there is no basis for their allegation that 5 the accounts were £3,509.18 short on week 49. 6 "Seventhly the position in respect of costs 7 is not as clear cut as it appears at first 8 because the courts have an ability to cap the 9 amount of costs awarded so as to make them 10 proportionate to the size of the claim. However 11 they have to take a number of factors into 12 consideration not merely the size of the claim 13 the conduct of the parties, ours has been 14 impeccable, the importance of the issues to the 15 parties, proportionality of the costs incurred 16 to the size of the claim has however been 17 emphasised in a recent Court of Appeal decision. 18 Therefore there is a risk that by rejecting 19 an offer of our standard costs ..." 20 Then skip the blank page. 21 "... the court could decide to cap the costs 22 at say £60,000 and then award only 60% of that. 23 Costs to date including the progress and the 24 work which the accountants have done together 25 with counsel's fees come to approximately 36 1 £140,000. 2 "However the trial is still a little while 3 off and I think we should aim for Castleton 4 agreeing for judgment to be entered against him 5 in the full amount plus an agreement that he 6 will consent to the payment of a fixed sum in 7 respect of costs. As a trade off we can offer 8 the letter confirming there was no dishonesty 9 and agree that we will not seek interest at 10 an indemnity level. The benefit of having 11 a judgment against him in the full amount is 12 that we will be able to use this to demonstrate 13 to the network that despite his allegations 14 about Horizon we were able to recover the full 15 amount from him. It will be of tremendous use 16 in convincing other postmasters to think twice 17 about their allegations." 18 That last line, the last two lines of that 19 paragraph, "the benefit of having a judgment is 20 the Post Office will be able to use this to 21 demonstrate things to the Network and it will be 22 of tremendous use in convincing other 23 postmasters to think twice about their 24 allegations", does that reflect your 25 understanding of the Post Office's approach to 37 1 Mr Castleton's case in general? 2 A. It doesn't reflect my recollection of it. 3 However, the language that's used in that, 4 I would agree, is similar to the language that's 5 used in the thing that you've shown me that's 6 four or five years later and is not pleasant. 7 Q. It's again suggesting that the result from 8 a sill case can be weaponised, isn't it? 9 A. Yes. 10 Q. "Postmasters take note, look what happens to you 11 if you deign to take us on". That was the 12 feeling, wasn't it? 13 A. I don't recall that being the feeling but, 14 clearly, that is the -- that's a fair 15 interpretation/description of sort of the tone 16 of those two lines that you've referred to, 17 yeah. 18 Q. Can we go to POL00113488. If we look at the 19 middle of page 1 -- thank you -- we can see 20 another email from Mandy Talbot to John Cole, 21 Mr Baines, to you -- 22 A. Yes. 23 Q. -- and to others. 24 A. Yeah. 25 Q. "Stephen Dilley has been approached by 38 1 an insolvency practitioner instructed by 2 Castleton." 3 So this is post-judgment now, the judgment 4 has gone against Mr Castleton. We're in 5 February 2007: 6 "You can read his comments about yourself. 7 "Castleton has also agreed our total bill 8 for costs in writing which means we do not have 9 to go to court to have them taxed which incurs 10 additional legal costs in its own right. This 11 response also indicates that Castleton has no 12 intention of appealing against the decision of 13 the court and that the judgment is the final 14 comment on the matter. 15 "As such we will need to get on with making 16 as much use of the judgment as possible. 17 Stephen Dilley has asked for permission to 18 publish an article in a legal journal about the 19 case which I have no objection to as long as we 20 maintain editorial control as the more publicity 21 the case is given the greater should be its 22 effect upon postmasters who take legal advice 23 about defending claims for repayment." 24 That's a further reflection of the Post 25 Office's strategy here, isn't it? 39 1 A. It does look like similar tone. 2 Q. "We've won, we need to hawk about the result 3 that we got as much as possible to discourage 4 other postmasters from even thinking about 5 taking us on"? 6 A. It's a similar tone to the other stuff, yeah. 7 Q. "... the more publicity the case is given, the 8 greater the effect on postmasters ..." 9 It's all of a piece, isn't it; and we see 10 exactly the same repeated after the Seema Misra 11 case, don't we? 12 A. Yes, the language that you picked out of those 13 is similar, yes. 14 Q. Can we move on, please. That can come down. We 15 can see from a series of documents that you 16 attended a series of regular calls with lawyers 17 from Bond Dickinson, if we can look at a couple 18 of examples, please. POL00043369. 19 So having gone backwards, I'm now going back 20 to where we were in the chronology, after the 21 Seema Misra case and we're now in 2013. 22 A. Right. 23 Q. This seems to be a record made by the Post 24 Office's solicitors, Bond Dickinson. It's 25 headed "Regular call re Horizon Issues", dated 40 1 2 October 2013. 2 A. Okay. 3 Q. You can see the attendees, Rodric Williams, 4 Jarnail Singh, both Post Office Legal, and then 5 Martin Smith of Cartwright King. Yes? 6 A. Yes. Yes. 7 Q. You now, in the Financial Services Centre, and 8 then, from Security, Dave Posnett and Rob King. 9 Then scroll down, please. Nobody from 10 Communication; some people from Network; and 11 some people from Information, Technology & 12 Change; and the Network Business Support Centre. 13 A. Yeah. 14 Q. Then over the page, please, "Previous issues 15 identified and further action to be taken", and 16 then there's a series of either Post Office 17 branches or issues identified in the left-hand 18 column and then narrative against each of them. 19 I'm not going to explore the content of any of 20 them. If you just scroll on, please. 21 And so it goes on -- 22 A. Yeah. 23 Q. -- including civil cases and criminal cases and 24 issues outside of litigation. 25 A. Yeah. 41 1 Q. Just to take another example, please. Can we 2 look at POL00043371. In October 2013, again 3 an attendance note by Bond Dickinson. You can 4 see the attendees and it's not dissimilar to 5 before. 6 A. Yeah. 7 Q. Then scrolling down -- thank you -- you attended 8 these series of meetings with individuals from 9 a variety of teams within the Post Office, 10 including Post Office Legal, to discuss ongoing 11 issues with Horizon; is that right? 12 A. Yes. Yeah. 13 Q. When were these meetings established? 14 A. I don't know when the start date of them was. 15 Q. What was the genesis of them? 16 A. It was probably everything that we've been 17 talking about. So I think around about that 18 time, within Product and Branch Accounting, 19 I think there would have been a back office 20 efficiency programme, which has been referred 21 to, and a project Ping was something in my 22 earlier call bundle. There were a number of 23 things that we were doing which we were trying 24 to do to make accounting of transactions in 25 branches simpler and more one-touch stuff. 42 1 Some of the things that were happening in 2 branches in respect of deployment of new 3 products and customer fraud, for example, a tax 4 of ATMs and ATM retracts, where people would get 5 £100 coming out and managed to do something with 6 the notes, not the top or bottom note but the 7 middle of them, there were a number of things 8 that were going on that were affecting the kind 9 of assurance about "Where is the cash", helping 10 to clarify with the subpostmasters things like 11 ATM retract trays within the ATMs, where 12 somebody might think the money was missing but 13 it was actually in a tray underneath the machine 14 because it had been retracted back into it. 15 So I think there was quite an overlap 16 between things that my team were doing around 17 back office efficiency programme which was 18 actually really front office product, linked to 19 back end, and that would make it easier to it 20 get the transaction going through in the first 21 place. Those things sort of inherently 22 overlapped with people perhaps complaining about 23 how easy it was to transact a product, and 24 things, challenges about how easy it was to 25 transact a product might lead to calls to the 43 1 NBSC. And sometimes those may rightly or 2 inadvertently become sounding like they were 3 questions about Horizon, when they may or may 4 not have been. 5 And some of the other things in the bundles 6 have referred to subpostmasters may, for 7 example, speak directly to Wincor Nixdorf, who 8 oversaw the ATMs, and you'd get a bit of 9 a message from one to another that doesn't 10 quite -- that sort of evolves over time and then 11 turns into something that says, "Here's 12 a Horizon issue", when actually it was branch 13 issue to do with another piece of kit. 14 So I think -- I don't know when this meeting 15 started but I think there was certainly 16 an overlap between understanding how to make it 17 easier to do some of the products, understanding 18 how the commercial product pillars were 19 deploying new things through our network and 20 issues that were being logged that would have 21 directly, perhaps, fallen under the description 22 of "Horizon issues" in here. 23 So you're right, the topic list we've seen 24 in that table covered some things that weren't 25 perhaps a matter of the essence of the kind of 44 1 challenges that this Inquiry is directly looking 2 at but there was sort of quite an overlap of 3 these different things coming together, and so 4 this group -- it feels right there was a group 5 that was convened, but I don't know when it 6 started, but that's -- well, I hope in some way 7 that helps as my description of -- that's how my 8 genesis of being involved in it comes about, 9 I think. 10 Q. Were there Terms of Reference for this group? 11 A. I don't know. I would expect there were. 12 I don't know. 13 Q. Was it a decision-making body? 14 A. Was it -- I don't think it was a decision-making 15 body. I think it was one that was going to make 16 sure that, with the different teams that were 17 involved, that we were able to have 18 a coordinated clarification of an issue. So, 19 for example, I've said about Wincor Nixdorf and 20 ATMs and retract trays within ATMs, there were 21 a lot of situations where a call and 22 a description of an issue may go directly to 23 NBSC. Equally, sometimes branches had got 24 direct telephone numbers into my team, so rather 25 than ticketing it through the NBSC they may have 45 1 called somebody who they spoke to about 2 a transaction correction the year before, and 3 called them on the off-chance they could guide 4 them to somebody. 5 Sometimes people wrote letters in to 6 different people in the organisation. Sometimes 7 things were raised through Network Relationship 8 Managers and so, where we were trying to ensure, 9 for example, that we dealt with the ATM retract 10 issue, we needed to make sure that we'd got some 11 forum where all the different people who might 12 have some knowledge of complaints being made and 13 process improvements being identified, that they 14 were coming together. 15 So this group wasn't making a decision about 16 something but I think it was a forum where we 17 could make sure that we've got a consistent 18 understanding of some of these topics. Possibly 19 it should have been several different groups 20 doing different things rather than having it all 21 coming together but I think at the time, because 22 it was clear there were sometimes a blurring 23 of -- for understandable reasons of somebody 24 speaks to somebody, who then speaks to somebody 25 else, who passes something on to somebody else, 46 1 sometimes there was some confusion about is 2 a colleague in the network making an allegation 3 about the Horizon System or is a colleague in 4 the network raising a point about something else 5 that needs some sort of improvement around it, 6 but may be nothing to do with the nature of the 7 concerns that have led to this Inquiry? 8 Q. To whom did this group report? 9 A. I don't know. I'm not sure if it did report to 10 somebody. I think often you might have a group 11 of people who meet to ensure that something is 12 done. There are lots of groups who may gather 13 who don't report to somebody, because it's -- 14 you've got together to fix something, and you've 15 worked out what needs doing, and you get on with 16 fixing it. This obviously is a group that's 17 touching on the Horizon matters, so I would have 18 expected that there'd be visibility of this 19 going into the legal director but I don't know. 20 Q. Just going back to page 1, please. You'll see 21 there's lots of lawyers involved. 22 A. Yes, yes. 23 Q. Why was that? 24 A. Well, I think because a lot of -- the point that 25 I'd made about the number of issues being 47 1 experienced with products in branches, a lot of 2 those things were being raised in cases. So 3 I think -- it's a long list and I don't know why 4 it needed five lawyers to be coming to the 5 meeting. 6 Q. Who established this group of people? 7 A. I don't know. I don't know. They're -- from 8 a back office efficiency programme point of 9 view, which was a programme I was responsible 10 for, I sometimes asked for groups to be convened 11 together such that we could have a common 12 understanding across Network, Commercial, 13 Marketing teams who'd got the relationship with 14 a corporate client, for example. So I would 15 sometimes convene groups. 16 I don't know whether I convened this one. 17 I imagine that if I would have asked something 18 from a back office efficiency point of view, if 19 Bond Dickinson are -- their letterhead's on 20 this, so I think this would have been initiated 21 by somebody in Legal. 22 MR BEER: Thank you. 23 Sir, I'm about to move to a new set of 24 topics, I wonder whether we could take the 25 morning break. We're going to comfortably 48 1 finish today and I would have thought before 2 lunch. 3 SIR WYN WILLIAMS: All right, that's fine. So what 4 time shall we start again? 5 MR BEER: 11.20, please. 6 SIR WYN WILLIAMS: Fine. 7 MR BEER: Thank you. 8 (11.06 am) 9 (A short break) 10 (11.20 am) 11 MR BEER: Sir, can you see and hear me? 12 SIR WYN WILLIAMS: Yes, I can, thank you very much. 13 MR BEER: Thank you very much. 14 I'm just going to move to the last topic 15 that I'm going to ask you questions about on 16 this occasion, Mr Ismay. 17 A. Okay. 18 Q. It's about what you subsequently wrote about the 19 payments and receipts mismatch bug. 20 A. Right. 21 Q. We're turning to a phase in February/March 2011, 22 so about six months after writing the Horizon 23 report. The documents suggest that you were 24 involved in communications between Fujitsu and 25 the Post Office relating to the receipts and 49 1 payments mismatch bug. 2 A. Right. 3 Q. You remember that, do you? 4 A. Yes. 5 Q. Okay. Can we look, please, to start with at 6 FUJ00081544. 7 Sorry, 1545. My mistake. Thank you. Can 8 we look at the second page, please. It's the 9 email in the middle of the page, between Will 10 Russell, who is described as a Commercial 11 Advisor in Service Delivery -- was he somebody 12 who worked for you at this stage? 13 A. No, I think Service Delivery was a part of the 14 IT and operations functions of the organisation. 15 So, no, he didn't report to me. No. I think he 16 reported to Andy McLean, actually, who -- 17 Q. Right. In any event, he says, "James", that's 18 James Davidson, to whom he is writing. Is that 19 somebody who reported to you or was within your 20 team? 21 A. No, James Davidson, I think, was a Fujitsu 22 person. 23 Q. He says: 24 "Dave Hulbert is off as you're no doubt 25 aware. I need to make you [aware] of an issue 50 1 that is bubbling away, and is likely to escalate 2 quite quickly. 3 "Salawu and Tony Jamasb on our side have 4 been dealing with the Receipts and Payments 5 issue that happened in September 2010." 6 I'm not going to investigate with you 7 whether or not that's correct, that the issue 8 only happened in 2010 or whether it was evident 9 in May or February 2010. We can leave that to 10 one side: 11 "The Receipts and Payments issue that 12 happened in September 2010. There was a small 13 team dealing with this and had got to the point 14 of resolution. However, given the current noise 15 in the press over the Horizon, Rod Ismay has 16 picked up this issue and is concerned that there 17 are still some unanswered questions around what 18 happened in branches. Can I ask you to get 19 involved please as I need to brief Mike on the 20 implications of this issue so we can check it 21 against statements we have previously made. One 22 of Rod's concerns was that this issue could be 23 detrimental in how we approach future comms and 24 cases pending." 25 Firstly, was it right that by February 2011, 51 1 you had concerns about how the receipts and 2 payments mismatch bug could affect pending 3 cases? 4 A. I think probably, yes. 5 Q. In what way were you concerned that the bug 6 could affect cases pending? 7 A. I can't remember exactly at the time but I think 8 I would have been thinking I've -- I'd just 9 collated a report that specified five topics, 10 I think, in it, back in August 2010 and this 11 looks like a sixth topic. 12 Q. This wasn't one of them? 13 A. This went one of them, yeah. So I think I would 14 have been concerned that there's another topic 15 arisen, and I think I would have been concerned, 16 consistent with that report back in September, 17 that if something now has arisen that's got 18 an impact on cases, well, what does that mean? 19 And I think that would be a matter for the 20 legal team to have decided what does that mean 21 in respect of ongoing cases, but this thing has 22 some of the other -- the document that came up 23 inadvertently, but you might move on to, it 24 looks -- and as I've looked at the evidence it's 25 helping remember what would have been going on 52 1 at the time, but I -- looks like I tried to go 2 through a scenario of, with these things 3 happening, this is what I would have expected 4 the accounts in a branch to show. However, what 5 the accounts in the branch actually showed was 6 this. 7 And I think I got into correspondence with 8 Gareth to say "Well, what has happened here? 9 How is one to the other?" So I think I would 10 have been concerned because I've got a role in 11 accounting and there is something here that 12 didn't make sense. 13 And I think, clearly in this -- the report 14 I collated refers to things like double entry 15 bookkeeping. Some aspects of the matters that 16 have come out of this have raised a question 17 about that kind of core concept and I think 18 there was an element of this in here, "Well, how 19 is that bookkeeping working through this 20 process?" And, therefore, I think there was 21 hardly anybody else in the organisation who 22 could talk double entry bookkeeping in that way, 23 so I was trying to marshall that conversation 24 with Gareth. 25 Q. I think the email that you're referring to is 53 1 FUJ00081544. 2 A. It was -- 3 Q. It came up earlier. 4 A. Yes, yes. 5 Q. At the foot of the page, we see a series of 6 questions that you address to Gareth Jenkins and 7 others -- 8 A. Right. Yeah. 9 Q. -- but principally addressed to Gareth Jenkins, 10 and the questions continue on this page. It 11 doesn't show up well in the non-colour version, 12 but he provides his answers underneath each 13 question. 14 A. Right, right. 15 Q. Overall, what did you take from his replies? 16 A. I can't remember what I took from it. 17 Q. Did it cause you to revisit anything that you 18 had written in your report? 19 A. I don't think it did. I mean, I don't think 20 I reissued the report that I'd done. I didn't. 21 The report stood. So I have tried to get my 22 head back into the space where I was to 23 understand this. I've got that 3,500 pages of 24 documents I've been working through to try to -- 25 and I have tried to put my head back into the 54 1 thought process I've got here and, evidently, 2 I'd got into some really detailed set-up of 3 here's number of things, a starting point, 4 here's a transaction that gets us to there, this 5 is what it should have been, this what it 6 actually was, how's the bookkeeping working 7 through there? 8 I hadn't managed, amongst all those 9 3,500 pages to get my head back into the space 10 exactly on this one, so I don't know what I made 11 of Gareth's reply that came back, honestly can't 12 remember whether I was assured or not, out of 13 it. But I think the general sense of my -- when 14 I did have conversation with Gareth about stuff 15 and with other colleagues at Fujitsu, I -- 16 perhaps wrongly, but I felt I was having 17 a conversation where I felt the individuals, and 18 Gareth included, knew what they were talking 19 about and presented a cogent analysis that made 20 sense to me, which was part of a reason for me 21 feeling assured about what he was saying. 22 So I don't know what my summary 23 interpretation was of this specific thing but 24 maybe we'll come to something that does indicate 25 what my thoughts were. I'm not sure what other 55 1 documents follow on from this. 2 Q. Thank you. That can come down. 3 As a general question to end my questions, 4 is there any reflection that you have got that 5 would like to give on your role, particularly in 6 2010, concerning this episode. 7 A. Well, I think in respect of -- in 2010, in 8 respect of the report that I've collated, and 9 I've put in my witness statement reflections 10 that I've got on that, I think it could have 11 been done differently, different tone of voice, 12 could have had a terms of reference agreed about 13 it. And I've indicated this morning that 14 there's this question of this was a report being 15 collated about reasons about -- the reasons to 16 be assured about an IT system, so why was it me 17 that was being asked to collate the thing? 18 So I think there was a number of things that 19 I'd perhaps stepped back and say, well, in 20 hindsight, I would have perhaps challenged who 21 was the owner of this system within the 22 organisation, and where are they coming to the 23 table to articulate and collate this thing? 24 MR BEER: Thank you very much, they're the only 25 questions I ask for now. 56 1 THE WITNESS: Thank you. 2 MR BEER: I think Mr Stein is first, sir. 3 SIR WYN WILLIAMS: Yeah. 4 Questioned by MR STEIN 5 MR STEIN: Mr Ismay, my name is Sam Stein 6 I represent a large number of subpostmasters and 7 mistresses and I'm instructed by a firm of 8 solicitors called Howe+Co. 9 A. Okay. 10 Q. Mr Ismay, I'm just going to remind you of the 11 dates or the date in particular of your system 12 integrity report. That was obviously in 2010, 13 in the very early part of August 2010; do you 14 remember that? 15 A. Yes, yes. 16 Q. You'll also recall, no doubt, the questions that 17 have been asked by Mr Beer, King's Counsel, 18 yesterday, regarding your system integrity 19 report. 20 A. I know he asked a lot of questions. 21 Q. He did. The overall result of your report was, 22 it seems, to give the Horizon System a clean 23 bill of health. You thought it worked okay; is 24 that fair? 25 A. Yeah, I thought there was a long list of reasons 57 1 to be assured, including avenues where 2 colleagues in branches could escalate issues if 3 they'd got them, rather than it coming to light 4 in a response to a case. 5 Q. So, in other words, Mr Ismay you're saying in 6 that report that what you're putting forward 7 there is that the system seems to be okay? 8 A. Yes. 9 Q. Yes. Now, you've just been asked some questions 10 about the receipts and payments mismatch issue, 11 okay? I'm going to take you to a document, 12 POL00028838. Thank you. 13 Now, this document, as you can see at the 14 top, if we just look at the top of the screen, 15 you can see left-hand side "Post Office"? 16 A. Yeah. 17 Q. Right-hand side, "Fujitsu"? 18 A. Yes. 19 Q. Right smack in the middle there is 20 "Receipts/Payments Mismatch issue notes", okay? 21 A. Yeah. 22 Q. All right, let's have a look at the attendees 23 because it's clearly referring to a meeting, all 24 right? 25 A. Yeah. 58 1 Q. Let's go through the attendees, Antonio Jamasb, 2 AJ in brackets. Somebody you know -- 3 A. Yes. 4 Q. -- within POL? 5 A. Yes, I think in Service Delivery, that was part 6 of Post Office IT, I think. Yeah. 7 Q. Emma Langfield? 8 A. I remember the name. Yeah. 9 Q. Again within POL IT? 10 A. Yeah, I think so, yeah. 11 Q. We can see there referred to as Service 12 Delivery. 13 Alan Simpson, Security? 14 A. Yeah, I think Information Security. 15 Q. Information Security? 16 A. Yeah, I think so. 17 Q. Right, quite senior? 18 A. I think he was a manager in the team, I don't 19 know what level his role was. 20 Q. Julia Marwood? 21 A. Yeah, I remember Julia in the Network. 22 Q. Again POL? 23 A. Yeah, POL, yes. 24 Q. Then Ian Trundell, rather helpfully described 25 there as IT. "IT" presumably his initials and 59 1 also IT expertise; is that fair? 2 A. Yeah. 3 Q. Andrew Winn, of course, you know, POL Finance. 4 A. My team, yes, yeah. 5 Q. Mike Stewart, Fujitsu SDM. 6 John Simpkins, Fujitsu Security. 7 Gareth Jenkins, Fujitsu Technical. 8 Mark Wright, Fujitsu Technical, okay? 9 So we can see this particular document has 10 got a real joined together sense. We've got 11 both Post Office, Fujitsu looking at the 12 receipts/payments mismatch issue; do you agree? 13 A. Yeah. 14 Q. Okay. Now, you've explained to Mr Beer, King's 15 Counsel that you were aware of this particular 16 issue, at least as we were looking at the 17 documents, by the time you reached the early 18 part of the following year 2011? 19 A. Yeah. 20 Q. Right. Now help us, please, with when do you 21 remember first being made aware of this issue? 22 Was it in 2010 or was it later? 23 A. I'm not sure when I became aware of it. There's 24 a lot of stuff in here that's prompted my memory 25 to recall things -- 60 1 Q. Of course. 2 A. -- and it looks like I was on holiday in 3 February and came back to get involved in 4 something. I think the bit of correspondence we 5 saw that was dated 18 February, maybe was before 6 the half term. So maybe I saw something earlier 7 in February. But, to the best of my knowledge, 8 it would have been February. I can't remember. 9 Q. Okay. Let's have a little bit of thinking about 10 the system integrity report. 11 A. Yeah. 12 Q. That report, was that circulated amongst POL 13 senior team membership, amongst managers? How 14 far did that circulation reach? 15 A. So I shared it with the senior managers within 16 my team, in the collation of that report, and 17 that is a thing that probably in hindsight they 18 should have been added to the circulation list 19 for clarity. So that report, I shared it with 20 the group who were named on that report. 21 I shared it with the five or six people who 22 directly reported to me because, in the 23 compilation of talking to people, then some of 24 my own team were some people who I spoke to to 25 gather some of the information that went into 61 1 that. 2 To the best of my knowledge, that's the 3 audience that I shared that report with. 4 Q. So it had reasonably good distribution amongst 5 POL? 6 A. Well, it had the -- well, 15 people on that one 7 and then five or six people who reported to me. 8 Q. Yeah, okay. Now, let's stay with dates for the 9 moment and, in relation to the document we have 10 on the screen, the pages that we have, 1 to 5, 11 are not dated. But if we go to the sixth page 12 within the bundle, we can see that's titled, top 13 right-hand corner "Appendix 2 to CS's responsive 14 note", so it would be the sixth page on 15 relatively, "Correcting accounts for lost 16 discrepancies", and then right at the bottom of 17 the page and, if it's possible to expand that 18 and highlight at the bottom, we'll see then some 19 help on dates. 20 Very grateful. 21 Now, is it possible to get rid of that 22 little inset box that's currently on the screen 23 that says, "Desktop UMV", et cetera? It's only 24 on my screen. Right. Right, apparently it's 25 only on my screen, so that's helpful. Let's 62 1 read through what, in fact, what you have on the 2 screen. We've got right at the bottom 3 "c:\documents and settings\Jarnail.a.singh", 4 then a variety of other things. Underneath that 5 you've got then "Printed at 16:38:24 on 6 8/10/2010", okay? 7 A. Yeah. 8 Q. So with that, and if we go back to some action 9 point summaries, we can see some dates that help 10 us a bit more in relation to when things are 11 happening, so if we go back a page, so that's 12 page 5 of 5 -- there we are. We can see, 13 Mr Ismay, that we've got a little bit more help 14 here on dates, despite the fact that the 15 document itself isn't dated, we can see we're 16 talking about dates that relate to 6 to 17 8 October and then the other date we looked at 18 for the back document -- 19 A. Yes. 20 Q. -- is the 10th. 21 A. Yes. 22 Q. Okay. All right. So we can see we're talking 23 about, I suppose, the first week or so of 24 October. 25 A. Yeah. 63 1 Q. All right -- 2010. 2 Now, back to page 1, so that's page 1 of 3 POL00028838, please. That document sets out 4 there, under the heading "What is the issue" and 5 if we just go through that, it explains slightly 6 better over the page, so we'll just look at that 7 in a moment: 8 "What is the issue? 9 "Discrepancies showing at the Horizon 10 counter disappear when the branch follows 11 certain process steps, but will still show 12 within the back end branch account. This 13 currently impacting circa 40 branches since 14 migration on to Horizon Online, with an overall 15 cash value of circa £20K loss. 16 "This issue will only occur if a branch 17 cancels completion of the training period but 18 within the same session continues to roll into 19 a new balance period." 20 Okay? 21 A. Yeah. 22 Q. All right. Now, this then is explained a little 23 bit better if we go over the page, all right? 24 Let's go to page 2 of 5, using the internal 25 document pagination. We should have at the top 64 1 of your page there, it says -- does it start 2 with "Note at this point nothing into feeds 3 POLSAP". You have that? 4 A. Yes. 5 Q. Right. Let's read through that: 6 "Note at this point nothing into feeds 7 POLSAP and Credence, so in effect the POLSAP and 8 Credence shows discrepancy whereas the Horizon 9 in the branch doesn't. So the branch will then 10 believe they have balanced." 11 Okay? Middle of that page, under the second 12 note it says: 13 "Note the branch will not get a prompt from 14 the system to say there is a Receipts and 15 Payments mismatch, therefore the branch will 16 believe they have balanced correctly." 17 All right? 18 A. Yeah. 19 Q. Lastly, just on what happens, what's the 20 consequence of the issue, "Impact", further down 21 that page, first bullet point: 22 "The branch has appeared to have balanced, 23 whereas in fact they could have a loss or 24 a gain." 25 Okay? 65 1 A. Yes. 2 Q. Right. This appears to represent a problem to 3 double entry bookkeeping; do you agree? 4 A. Yes. 5 Q. Right. The point being, your background 6 training as an accountant is that, essentially, 7 what you should be able to find within the 8 branch should match the rest of the system? 9 A. Yes. 10 Q. Do you agree? 11 A. Yes. 12 Q. Right. Now, this doesn't appear to say that the 13 system's working properly or indeed is fine and 14 dandy, does it, Mr Ismay? 15 A. No, it doesn't. 16 Q. No. Now, you were asked a number of questions 17 by Mr Beer, King's Counsel about this particular 18 issue. Did you have the understanding of this 19 particular issue, that you and I have just 20 looked at over the last few minutes, at the 21 early part of 2011? 22 A. I must have because I've dated something 23 18 February. So I certainly did then. 24 Q. Why, Mr Ismay, did you not amend your report 25 from August 2010 when you knew, at least from 66 1 this particular mismatch bug issue, that, in 2 fact, this was not a system that operated 3 properly at all times? 4 A. So I don't know why I didn't redo that report. 5 The report had just been asked for as a one-off 6 at the time and I provided that. You'll have 7 seen some of the audience in those emails there 8 were -- one of them was a direct addressee of 9 the original report. And so, clearly, some of 10 that audience were also aware of this thing 11 because they'd been corresponding about it while 12 I was on holiday. 13 But I'd got lots of things that I was 14 involved in and the concept with all the things 15 that I was involved in, gearing up to Royal Mail 16 privatisation, the thought in this -- and 17 I appreciate this is unsatisfactory in the 18 nature and gravitas of the whole of events that 19 have gone on, but thinking of rewriting and 20 reissuing the report that I'd done the previous 21 year I don't think crossed my mind at the time 22 because I was incredibly busy with many other 23 things. 24 Now, clearly, that is -- in the context of 25 what's happened, it does beg a question of 67 1 "Well, should I have redone that report?" And 2 in hindsight, I probably should have but 3 I didn't. 4 Q. Mr Ismay, your background, as you describe in 5 the statement you give, is that you joined the 6 Post Office in September 2003 as Head of Risk 7 and Control in the Finance Directorate? 8 A. Yes. 9 Q. You previously worked for a company that's well 10 known, called Ernst & Young. You consider 11 yourself to be a finance professional with 12 a background in audit accounting and positive 13 experience of board reporting, staff engagement, 14 and process improvement. How would you rate 15 your own performance in relation to not amending 16 that report, Mr Ismay? 17 A. I think on this one, that's a failure. 18 Q. Thank you. 19 A. I think there are many other things that I did 20 that were not and I got a lot of feedback that 21 there were a lot of positive reports and 22 a positive process leadership that I did but, on 23 this specific one, it's clear that that was 24 unsatisfactory. 25 Q. So the upshot was that you left a report that 68 1 gave the system a clean bill of health, 2 essentially un-updated within the POL system, as 3 being a general report that said that 4 everything's fine and dandy with the Horizon 5 System. You just left it unaltered. That's 6 what you did, isn't it, Mr Ismay? 7 A. I, as I've explained earlier, was asked to 8 collate a report which begs a question to me of 9 why wasn't somebody in IT who owns this system 10 asked to collate that report in the first place? 11 Members of IT were talking about that thing 12 while I was on holiday in February. Members of 13 IT should have been responding to the issue of 14 what was -- how did this add to it. Yes, as 15 a professional, I had issued a report, and that 16 begs a question of should I have reissued that? 17 Well, I'm not sure it should have been me 18 writing the report in the first place and, as 19 I've put in the end of my witness statement, 20 I've suggested that there should be clearer 21 ownership of systems in order that the relevant 22 individuals can escalate people -- things to the 23 right place and ensure there is resolution by 24 the owner of the appropriate system, which was 25 not me. 69 1 Q. Did you check whether, as you've just said, the 2 members of IT were adequately responding to this 3 particular issue, so that you could then take 4 that into account in relation to your report? 5 Did you check whether anything was being done? 6 A. I would have asked for -- get on and sort this. 7 Q. Can I ask you to go back to the document, which 8 is POL00028838 page 2 of 5. It's on screen, I'm 9 very grateful. Under "Impact". Look at the 10 bottom part. We've looked at the first bullet 11 point. It says this that, in relation to this 12 issue, second bullet point, this is: 13 "Our accounting systems will be out of sync 14 with what is recorded at the branch." 15 Third bullet point: 16 "If widely known could cause a loss of 17 confidence in the Horizon System by branches. 18 Fourth bullet point: 19 "Potential impact upon ongoing legal cases 20 where branches are disputing the integrity of 21 Horizon data." 22 The fifth and last of those five bullet 23 points: 24 "It could provide branches ammunition to 25 blame Horizon for future discrepancies." 70 1 Do you agree that those are the same types 2 of sentiments as you've examined with Mr Beer, 3 King's Counsel. 4 A. I agree that those sound like the same types of 5 sentiments, yes. 6 MR STEIN: Just give me one moment, Mr Ismay. 7 Nothing further, Mr Ismay. Thank you. 8 THE WITNESS: Thank you. 9 SIR WYN WILLIAMS: Mr Ismay, while it's on my mind, 10 on a number of occasions now, you have used 11 a phrase like "it begs the question" in respect 12 of why it was you that was chosen to write the 13 report in August 2010. I just want to be clear 14 what the implication of that is. Are you 15 suggesting that Mr Smith had an ulterior motive 16 in inviting you to make that report? 17 A. No, I'm not suggesting he had an ulterior motive 18 but I'm wondering why as -- somebody in IT who 19 owned the system wasn't asked to, because they 20 would have been more readily able to immediately 21 come up with some more sections of that report. 22 SIR WYN WILLIAMS: Well, that might be a fair point, 23 which is why I asked you the question whether 24 you could, if you can, offer any kind of 25 explanation as to why it was you that was 71 1 chosen. 2 A. Well, I think that I was chosen because Dave was 3 relatively new in the organisation. I think he 4 was only in Post Office for a year. I don't 5 know when he joined, but he would have 6 probably -- with the diversity of the 7 organisation -- would still have been learning 8 about a number of things. 9 I know that he came to Chesterfield and 10 I and my team would have explained to him the 11 nature of the functions that we did in 12 Chesterfield, which had a large contact with 13 subpostmasters and Post Office branches. So 14 I think that Dave would have interpreted out of 15 that that I had got an understanding that 16 possibly felt more, from the conversations he 17 was having, than with other teams that he'd had 18 an induction with. 19 So I -- and -- and that's why I think he 20 asked me. 21 SIR WYN WILLIAMS: All right. Thank you. 22 Yes, who is next, please? 23 Questioned by MS PAGE 24 MS PAGE: Flora Page, sir. 25 On behalf of a number of the other 72 1 subpostmasters, Mr Ismay. 2 Did you speak to any other potential 3 witnesses before giving your evidence to the 4 Inquiry about your evidence? 5 A. No. So I've not spoken to any other witnesses 6 in the course of any things that I have had to 7 do with the Inquiry, no. 8 Q. Mr Beer, King's Counsel took you to an email 9 yesterday that Lynn Hobbs apparently sent to 10 you, in which she told you that Fujitsu could 11 insert transactions into branch accounts; do you 12 remember that email? 13 A. I do remember that document, yes. I remember it 14 from the pack yesterday, yeah. 15 Q. Well, that was what I was going to say. You 16 received that, of course, prior to coming 17 yesterday, didn't you? 18 A. Yes, so that would have been in one of the 19 bundles that I received, yes. 20 Q. So you will have seen when you read it that it 21 was also sent to Angela van den Bogerd, although 22 not at the same time as it was sent to you; it 23 was sent to her subsequently. Did you notice 24 that? 25 A. Well, I can't remember whose names were on the 73 1 thing but if that's -- I'm not disagreeing with 2 you if that's -- yeah. 3 Q. All right. Well, bear with me. It was sent to 4 her at the same time as your report was sent to 5 her, your report to the Managing Director David 6 Smith, in which you said that there were no 7 backdoors into the Horizon System and that 8 branch accounts could not be changed in any way 9 by anyone other than those in the branch? 10 A. Right. 11 Q. Yes? 12 A. Yeah. 13 Q. So she received the two contradictory documents 14 at the same time: on the one hand, an email from 15 Lynn Hobbs saying that Fujitsu could insert 16 transactions; and, on the other hand, your 17 report saying that they could not. 18 A. Right. Okay. 19 Q. So when you read that in advance of these 20 hearings, did you think of speaking to Ms van 21 den Bogerd about the Hobbs email -- 22 A. No. 23 Q. -- to see what she remembered of it? 24 A. No. I've consciously not spoken to anybody back 25 at the Post Office and I don't know anybody at 74 1 Fujitsu either. So I've not spoken to other 2 people and I've been as keen as possible, in the 3 nicest way, to avoid reading things in the press 4 and on social media, as much as possible, in 5 order to come here with as uncontaminated 6 a recollection as I can to have this 7 conversation. 8 And I certainly have not, and I would say 9 going back a few years, I have been contacted by 10 Post Office Limited with a question of could 11 I help to collate an understanding of what 12 happened many years ago. So with one firm of 13 solicitors acting for the Post Office I was 14 approached a few years ago, after leaving the 15 Post Office, to provide something. Angela, 16 I think, texted me to say would I mind speaking 17 to the solicitors, but that's the only contact 18 I've had. 19 Q. All right. So we're to understand that you 20 simply haven't asked her about what she may 21 remember or whether she spoke to you at the time 22 about it? 23 A. No. And I think my perception for this Inquiry 24 is that it's more appropriate that I come into 25 the room uncontaminated by what other people's 75 1 thoughts are. The Inquiry has presented me with 2 things, they tried to jog my memory of what 3 happened all those years ago, and I have not, 4 and I feel it would have probably been 5 inappropriate to be having a discussion with 6 other potential witnesses. So no. So 7 I haven't, no. 8 Q. The same, then, must be true also of Mike 9 Granville who received that email at the same 10 time as you? 11 A. That's correct. So I probably haven't -- 12 I haven't spoken to Mike Granville since I left 13 the Post Office. No. 14 Q. It's interesting to note that we don't have that 15 email from Lynn Hobbs to you and Mike Granville 16 in the form that it was originally sent. You 17 saw that, didn't you? It was in the format of 18 apparently that email having been cut and paste 19 into another email from Ms Hobbs to John 20 Breeden. Did you notice that? 21 A. Yes, I did notice that, yeah. 22 Q. So what we don't have is the email as it would 23 have appeared in yours and Mike Granville's 24 inbox? 25 A. Yeah, or did it even go into my inbox. So 76 1 I don't know what emails I received by then. 2 Probably like you, I do find it slightly odd, 3 but I would also expect the -- I don't know the 4 process by which the Inquiry has been able to 5 obtain all the different documents that are fed 6 into these bundles. It sort of feels like you 7 must have had access to email accounts or 8 something to collate this. 9 So I am somewhat puzzled for what appears to 10 be an important document, why it is a cut and 11 paste. That seems -- that's slightly odd. 12 Q. Yes, because we all know, don't we, that emails 13 would also not only be in your inbox but 14 presumably your outbox, her sent items, yes? 15 A. Yes, yeah. 16 Q. And presumably also in Mike Granville's inbox, 17 yes? 18 A. Yeah, yeah. 19 Q. So we don't have it from any of those sources, 20 although it must have been available to Ms Hobbs 21 when she cut and pasted it in the month that she 22 cut and pasted it, yes? So she must have had it 23 in her sent items at that point, mustn't she? 24 A. Well, yeah, presumably it was either an email 25 that was in sent items, which is most likely the 77 1 case, or one could type it and paste what you 2 want. 3 Q. So do you know anything about why the original 4 email is apparently no longer in existence? 5 A. No. 6 Q. Were you ever aware of your colleague's in 7 Security destroying documents? 8 A. No. I have read in the press subsequently, like 9 in the last couple of years, comments about 10 individuals and shredding but I wasn't aware at 11 the time that I was at the Post Office of -- 12 Q. Not when you were in charge of those in 13 investigations either? 14 A. No. 15 Q. So there was a period, wasn't there, when 16 Mr Utting was reporting to you and you were, in 17 effect, the possible of investigations, yes? 18 A. Yes, so probably in 2005, yeah. 19 Q. You've told us that you haven't listened to the 20 Human Impact evidence. You'll forgive me if 21 I put some to you because it relates to the 22 conduct of the investigators? 23 A. Yeah, could I just clarify the reason that 24 I haven't listened to the Human Impact -- and 25 it's awful, I know that the content of that will 78 1 be really awful for the individuals concerned 2 and difficult to share that. That goes back to 3 the concept, again, of me wanting to be able to 4 attend this Inquiry with as uncontaminated 5 a history in my own head of what do I remember, 6 because the nature of the Inquiry is I am sat 7 here having seen some things in the press, I've 8 had people on Twitter saying things about me, 9 which you hear so many things, and eventually 10 you think "Well, can I remember that?" Or "I've 11 heard this so many times, did I hear that or 12 not?" 13 And therefore I've tried to take the 14 approach, and I don't want that to sound 15 insensitive, but I've tried to take the approach 16 as much as possible of not listening to the 17 commentary, including those -- Phase 1 of this 18 Inquiry, and that's really because I received 19 a letter that said I was going to be invited to 20 the Inquiry. I thought "Right, I want to be 21 able to come here and give my own memory of it", 22 and that's not in any disrespect to the 23 individuals who will have found it hard to share 24 that. I didn't want to come here with 25 a possibility of what they said contaminating my 79 1 recollection of what I'm sharing with you. 2 Q. Why did Andrew Winn's testimony fall into 3 a different category to the Human Impact 4 testimony, in that case? 5 A. Because Andy Winn worked for me and there 6 were -- specifically that felt appropriate to 7 look at. 8 Q. All the more reason why his recollections may 9 have contaminated yours, no? 10 A. Well, okay. Yeah. Yeah. 11 Q. Could I have, please, INQ00001035, please. 12 A. Could I just also add to that that, as 13 an attendee coming in as a witness, I did think 14 it was important to me to have an understanding 15 of how a witness session is conducted. And so 16 I have watched Andy Winn's and that's helped me 17 partly to understand the context of the 18 environment to which I would be coming in. 19 Q. Could we go down, please, to page 4. I'm trying 20 to find the internal numbering, page 14. Could 21 we zoom in on page 14. Thank you very much. If 22 we pick up at line 22. This is Tracy Felstead, 23 giving an account of being interviewed by Post 24 Office investigators. 25 A. Right. 80 1 Q. The questions are obviously coming at this stage 2 from Counsel to the Inquiry. All right? So 3 then Q and then A. So I'll read through sum of 4 the Q&A, please: 5 "Question: What did they ask you and what 6 did you say? 7 "Answer: They asked me where the money had 8 gone, what I'd done with the money. Never at 9 any stage was it 'What do you think has 10 happened, was there any reason for this to 11 happen?' It was very much I was being asked 12 constantly what have I done with the money, 13 'Where has the money gone?' I was being accused 14 from day dot." 15 Then if we go, please, to page 17, internal 16 numbering, line 22 again. Just above line 22, 17 sorry, I've got the wrong line number there: 18 "Question: So you were being asked to prove 19 how you had not committed a crime? 20 "Answer: Yes. 21 "Question: Is that how the interview went? 22 "Answer: Yes, yes, very much so. They had 23 access to my bank accounts. They had access to 24 my home. They never, ever came to my home or 25 searched my home but they looked through all the 81 1 bank accounts. There was no money to find 2 because there was no money there." 3 So this was in 2001. So it was before your 4 time. 5 Thank you, that can come down. 6 But we can see there, can't we, that the way 7 that the investigation went, the way that the 8 investigators conducted it, was on the 9 assumption that there was fault. There was not 10 an impartial or open questioning. It was almost 11 a reversal of the burden of proof from the 12 start, wasn't it? 13 A. That -- yes. 14 Q. Yes? 15 A. Yeah. 16 Q. That's what we see there. 17 A. Yeah. 18 Q. You've told us about how you knew that passwords 19 and user IDs were shared and not necessarily 20 used as they should have been to identify who 21 was doing what? 22 A. Yeah, yeah. 23 Q. That was actually what was going on in Tracy 24 Felstead's case. That was the defence that 25 she'd put forward. So, plainly, she had 82 1 a defence, one that, in fact, you knew about. 2 What did you do to make sure that investigators 3 approached these cases knowing that there were 4 possibly reasons why people were not responsible 5 for thefts when Horizon said there was money 6 missing. What did you do to make sure 7 investigators knew that? 8 A. I don't know what I did to ensure objectivity. 9 That doesn't sound objective. I'm agreeing with 10 the point you're raising. I don't know what 11 I did to do that. 12 Q. Well, you were the one who was in charge of 13 investigators. Did you think it was your job to 14 make sure that investigators were objective? 15 A. I would like to think that I did. I think -- 16 Q. But you don't know what you did to put that into 17 effect? 18 A. No. I probably didn't put anything into effect, 19 and let me just expand on that. So the conduct 20 of a case, the investigators reported to me, 21 rightly or wrongly, most of my focus with the 22 investigations team -- when Security was split 23 into two, from physical Security to 24 Investigations, I was given the investigations 25 team primarily because there was felt to be 83 1 a linkage between audit risk modelling that the 2 audit team did and the fraud risk modelling that 3 the fraud risk team did and, therefore, the two 4 teams came together. 5 Rightly or wrongly, my focus during that was 6 about the data that was enabling the targets 7 through the risk modelling. The relationship 8 between the investigators was very much that 9 a case was compiled and was present to the 10 Criminal Law team and there was an oversight of 11 that by the Criminal Law team. So I was the 12 head of a team that had the investigations team 13 in it, but I was not qualified of 14 an investigations background but I felt assured 15 that there's a relationship between the Criminal 16 Law team and the investigators that was 17 overseeing the way in which case files were 18 compiled. 19 Q. Well, let's just look at the document that 20 Mr Beer, King's Counsel took you to. It was 21 significantly after your time, but appears to 22 have been the only document we can find which 23 deals with the way investigations were carried 24 out. 25 A. Right. 84 1 Q. So that's POL00038853. If we can go down to 2 page 25, please. If we zoom in on 5.19.10, 3 paragraph 5.19.10. This comes after a series of 4 paragraphs explaining the way that the 5 decision-making process for when to charge 6 somebody comes about, and this is the sort of 7 culmination of it. It says that the Post Office 8 Legal and Compliance Team then goes to Head of 9 Security. You see that arrow, that's being used 10 in these paragraphs as a way to suggest that the 11 decision moves from this team to that team. 12 A. Okay. 13 Q. So this final decision goes from Post Office 14 Legal and Compliance to Head of Security: 15 "The file is then forwarded to the 16 designated prosecution authority (DPA) for 17 authority to proceed. The DPA will review the 18 case file and decide whether to proceed with the 19 advice from the POLCT [the POL Legal and 20 Compliance Team] and Cartwright King or whether 21 to take a different course of action. The 22 authority to proceed (or other instruction) will 23 be inserted into the case file." 24 So, in other words, quite clearly it was 25 Head of Security that took the final decision on 85 1 whether to charge someone, not the Legal and 2 Compliance team. 3 A. Well, it wasn't coming to me as a decision, so 4 when I was Head of Risk and Control, including 5 the investigations team, things weren't coming 6 to me to say, "Rod, what do you decide about 7 this?" Things were being -- a case was 8 compiled, and there was a relationship into the 9 Criminal Law team on that and I think the 10 criminal law team would, if necessary, have had 11 conversations, I think, with the Director of 12 Public Prosecutions area, and the approach was 13 through them. It was not to me to say "Rod, do 14 you approve this?" No. 15 Q. Thank you, the document can come down. 16 So your evidence is that, some time after 17 your time, there was a process change which 18 meant that the final decision lay with Head of 19 Security rather than Legal? 20 A. Yeah. 21 Q. All right. Can we please look at a document 22 which you have looked at, but I'd like to just 23 look at some other parts of it, if I may, 24 please. It's in document number POL00090437. 25 We're going down to page 86 of this rather long 86 1 document. This is -- if we could also just have 2 a quick look at page 87, which I think is the 3 one we've actually looked at before. 4 Do you remember you saw this email in which 5 Mr Utting was sort of making a pitch, if you 6 like, for -- 7 A. Yes, yes. 8 Q. -- the work of doing civil investigations? 9 A. Yes, yeah. 10 Q. At this time, you were still his boss, yes? 11 A. Yeah, yeah. 12 Q. I just wondered if you recognise the handwriting 13 at the top of that email or on the preceding 14 page? 15 A. No. No. 16 Q. If we zoom in a bit on that handwritten page and 17 see if we can make out what some of it says: 18 "There is a need to work up a business case 19 to obtain additional resource, possibly from 20 Chesterfield." 21 I'm just trying to see on the page where 22 I got that from. Oh, yes, I think it's 23 paragraph 1 there. Can you just about see that: 24 "Issues with Civil Litigation Cases: 25 "need a business case to be worked up to get 87 1 additional resource -- could come from 2 Chesterfield." 3 Then there's a mention apparently of Dave 4 Hulbert. Is that ringing any bells with you? 5 A. That -- I can't remember this document, but the 6 kind of theme of what's in it rings a bell with 7 me, in that I think we were, as we saw 8 yesterday, going through headcount reduction 9 exercises regularly and I think, certainly, the 10 concept of if something -- if something new 11 needed resourcing up, given that there was 12 a headcount reduction target in another area but 13 perhaps a need for resource somewhere else, it 14 might have been that somebody could have been 15 redeployed out of the Chesterfield team to work 16 on something else. 17 So the idea of it doesn't seem unreasonable, 18 to me, that if the Security team, the 19 investigations team was looking for some 20 resource, then maybe some resource would have 21 come out of a restructuring of Chesterfield. 22 That makes sense. I don't remember this thing 23 but that would make sense to me. 24 Dave Hulbert is in IT, so whether in IT they 25 would have had resource, I don't know. 88 1 Q. Does it suggest any kind of a link between 2 Chesterfield and Security? 3 A. Well, I think -- I mean, there is a link, 4 because the nature of what Security might have 5 been looking for somebody to do with data 6 gathering and, given that a number of pieces of 7 data that would feed into security risk 8 modelling were data that were coming from 9 Chesterfield, then there absolutely was a kind 10 of an almost resource in Chesterfield who would 11 have an element of experience that would give 12 them the capability to help another team. 13 So that -- there was a natural knowledge 14 opportunity that there would be a linkage there, 15 yeah. 16 Q. Was there a sense in which Security was sort of 17 running parts of the business, Legal, 18 Chesterfield, Security in charge? 19 A. No, I don't think so. I think it was a thing 20 that those teams would have been speaking to 21 each other during the course of things and there 22 was sort of some common skills between those 23 areas or common process understandings that -- 24 and common -- the Chesterfield teams and the 25 security teams would both have had 89 1 an understanding of product transactions in 2 branches and, therefore, somebody going either 3 way between the two teams could help the other 4 team by hitting the ground running, with some 5 standing knowledge of processes. 6 Q. Can I pick on another point on the next page, 7 third paragraph of the email that we looked at 8 yesterday. In the paragraph beginning 9 "Because", Mr Utting says this, as part of his 10 pitch: 11 "Because we also have strong ties with the 12 Security and audit function within Fujitsu, we 13 are also able to take witness statements from 14 them in support of prosecution cases and could 15 use the same links in support of Civil matters 16 ..." 17 Then he says, in brackets: 18 "... (indeed, the standard statements that 19 they currently provide to us in prosecution 20 cases were originally drafted with somebody from 21 our team)." 22 Do you know anything about that, with them 23 providing standard form statements to Fujitsu? 24 A. I don't, but I am aware that where there are -- 25 often, an organisation will ask another 90 1 organisation about templates of stuff. In my 2 current job, I speak to peers in other 3 organisations and we discuss templates of things 4 because why recreate the wheel if somebody has 5 got the sort of eight headings that are 6 a structure for something? 7 So the idea that they may have compared 8 a template between the two makes sense to me. 9 I don't recall the conversation but it makes 10 sense to me that they may have discussed the 11 template. 12 Q. So you weren't involved in Mr Utting helping 13 Fujitsu to draft their templates? 14 A. No, no. No, I wasn't. And let me be clear 15 about the word "template" in there. A template 16 is a structure of something. It is not the 17 content related to a particular case. So it 18 would make sense to me that two organisations 19 might speak to each other about does a document 20 have an executive summary, an index, an author's 21 page? That is the sort of template that I'm 22 talking about. 23 Q. Do you know whether Mr Utting gave any thought 24 or did you give any thought to the possibility 25 that these might be used by "expert witnesses" 91 1 and the sort of format that an expert witness 2 ought to use? 3 A. Well, I don't think I did. But I would have -- 4 I would think that Tony may have had experience 5 of working with expert witnesses and, if there 6 was some knowledge of what does an expert 7 witness do, then, quite, that may have informed 8 something about a template. As I say, that is 9 about a template, not about case-specific 10 content. 11 Q. All right. Well, let's move on to case-specific 12 content in the case of Mr Castleton. Could 13 I have, please, document number POL00107426. If 14 we just have a look at the date first. This is 15 the November of the previous year to the one we 16 were looking at, so it's 2005. So presumably 17 you're still in investigations at this stage, 18 yes? 19 A. Yeah. 20 Q. Or you're leading investigations? 21 A. Yeah. 22 Q. If we just scroll down a bit and sort of come up 23 from the bottom, as we do with email chains, 24 I think I'm right in saying, I think it may be 25 one of these ones which has blank pages. Yes. 92 1 If we just pause here, please, and go back and 2 just have a look at who that was sent to, which 3 includes you. 4 It comes from Mandy Talbot and goes to David 5 X Smith -- and I think we're all clear that's 6 the head of IT, rather than the much later MD, 7 Dave Smith? 8 A. Yes, that's right. 9 Q. Jennifer Robson, Tony R Utting, and you, as well 10 as some other copies in. So this is Mandy 11 Talbot describing a little bit background on the 12 Castleton case and what has happened so far: 13 "Proceedings have been issued by POL against 14 Lee Castleton the former postmaster at Marine 15 Drive for £27,000. It was known by the business 16 prior to the issue that Lee Castleton blamed 17 Horizon for the losses. External solicitors 18 were asked to check with the Fujitsu liaison 19 team and to assure themselves that the evidence 20 in respect for Horizon was sound before the 21 issue of proceedings. There had been no 22 security investigation so the data had not been 23 requested from Fujitsu. 24 "Proceedings were issued and a defence and 25 counterclaim for losses flowing ..." 93 1 She then goes on to describe how the court 2 ordered a stay and that there was some mistakes 3 made and a judgment in default was filed by 4 Mr Castleton. So I'm just sort of summarising 5 a bit here. She describes how there was a short 6 hearing and, as a result, the judgment in 7 default was set aside. So if we go down to the 8 next paragraph: 9 "As part of the claim the solicitors for Lee 10 Castleton have stated in the allocation 11 questionnaire that they intend to call evidence 12 from other existing and former postmasters about 13 the problems with the Horizon System. They have 14 also asked for disclosure of data about all 15 calls or complaints logged from postmasters 16 about the Horizon System, presumably from the 17 inception of the system. They have called for 18 disclosure of all documents removed from the 19 branch office during the investigation. There 20 is an issue over locating all these documents." 21 All right? So solicitors acting for 22 Mr Castleton had asked for very significant 23 disclosure of problems with Horizon, yes? 24 A. Yes. 25 Q. If we go down, she sets out how another case, 94 1 that involving a Mr Bajaj, was also challenging 2 the validity of data supplied by the Horizon 3 System. 4 Then, if we carry on down and past the blank 5 page, she talks about there being other 6 postmasters potentially in a similar situation: 7 "His solicitors say that they have been 8 contacted by other postmasters and that a class 9 action is possible, unless the deductions from 10 remuneration are refunded. They also make 11 a reference to what we assume is the Castleton 12 case." 13 She talks about "Issues": 14 "In each case the postmasters are 15 challenging the validity of data provided by the 16 Horizon System and the cases became litigious 17 before that evidence could be properly 18 investigated. 19 "In each case it was known that Horizon was 20 going to be challenged but there was no 21 procedure in place to: 22 "(a) acquire the necessary data 23 "(b) identify somebody with the relevant 24 knowledge and capacity to interpret the data and 25 report on the same. 95 1 "If the challenge is not met the ability of 2 POL to rely on Horizon for data will be 3 compromised and the future prosperity of the 4 network compromised. 5 "Fujitsu's reputation will be affected." 6 She goes on to make "Suggestions": 7 "1. A robust procedure is set up and 8 communicated to all relevant parties for 9 extracting necessary data from Horizon at 10 an early stage in all cases leading towards 11 possible termination of contract in each case 12 where the Horizon System data is challenged. 13 "2. This will necessitate expenditure by 14 POL in identifying a small team and training 15 them in interpretation and investigation 16 techniques. 17 "3. Fujitsu and POL to liaise on 18 identifying a number of individuals or 19 specialist computer firms who could provide 20 a professional and independent report upon the 21 Horizon System in general and in the two cases 22 to hand if necessary. 23 "4. POL/Fujitsu investigate and identify 24 whether or not they do hold any data upon the 25 number of complaints made by postmasters about 96 1 the Horizon System since inception and whether 2 or not it can be broken down into statistics 3 about valid problems/resolutions/errors by 4 postmasters. 5 "5. Identify current members of POL or 6 Fujitsu staff too can provide statements in the 7 two current cases which (a) validate the system, 8 (b) explain the Horizon System process from 9 end-to-end and (c) can explain why each and 10 every point made by the Defendants is irrelevant 11 or can be explained." 12 Forgive me for reading that out at some 13 length but it has been sent to you and to 14 Mr Utting and this is back in 2005. So you're 15 plainly aware, at this stage, of a significant 16 number of complaints from subpostmasters about 17 Horizon, aren't you? 18 A. I am, and as I said yesterday, I was aware of 19 the Cleveleys case, that referred to -- which 20 was something which I'd asked -- 21 Q. It wasn't just the Cleveleys case, was it? It 22 was quite number of cases, yeah? 23 A. Yeah. 24 Q. Not forgetting, of course, that, in the 25 Cleveleys case, POL lost, didn't it? Post 97 1 Office lost? 2 A. Well, I can't remember exactly what happened 3 then but, yeah, I think -- 4 Q. Can you not remember that the Cleveleys case was 5 one that the Post Office lost? 6 A. I can recall what these documents have showed 7 me. I can't remember the circumstances of the 8 Cleveleys case but I think one of these 9 documents says that something like £186,000 was 10 paid out because there was a lack of records to 11 respond to it. I can't remember that as my own 12 experience of something that was shared at the 13 time but that was in one of these documents in 14 the bundle. So I do know that because you have 15 had shown me a bundle document that refers to 16 that thing back then, yes. 17 Q. On receiving this email, did it not occur to you 18 to start wondering whether there was a problem 19 with the Horizon System? 20 A. I think I was still being assured by IT that 21 there wasn't. 22 Q. Still that verbal assurance, was it? 23 A. Yeah. 24 Q. What happened to Ms Talbot's suggestion of 25 identifying a number of individuals or 98 1 specialist computer firms who could provide 2 a professional and independent report? 3 A. I don't know. 4 Q. Well, it was addressed to you; do you not know? 5 A. No. 6 Q. What happened to her suggestion that POL and 7 Fujitsu should investigate and identify the data 8 about the number of complaints made by 9 subpostmasters about the Horizon System since 10 inception? What happened to that suggestion? 11 A. I don't know but I would suggest that the 12 handwriting that you showed me on the previous 13 one suggests maybe that was a follow-on to that, 14 but I don't know what then happened as 15 a follow-on to that. 16 Q. The email that you were taken to by Mr Beer, 17 King's Counsel about possible settlement -- 18 sorry, that document can be taken down now. 19 Thank you very much. 20 Do you recall that you were shown an email 21 about settlement of the Castleton case, possible 22 settlement? 23 A. I was shown so many documents yesterday. I'm 24 happy for you to represent the thing. I can't 25 remember what documents I saw yesterday but 99 1 please do bring it up and ... 2 Q. I hope I won't be trying everyone's patience too 3 much. I'm sure that I'm going to be able to 4 finish by lunchtime. So, with the Chair's 5 indulgence, if we could just look at it again. 6 It's POL00090437. It's at page 63. This is the 7 one where she starts off saying: 8 "I have received some very good news about 9 this case but now need the business to make 10 an urgent decision upon its future conduct." 11 Then she sets out that she's heard that 12 there may be possibility of settlement. In that 13 fourth paragraph: 14 "Last night our barrister received 15 a compromise offer from Castleton's solicitors 16 ..." 17 Do you remember this one now? 18 A. Yes, I do now recall that document being shared 19 yesterday, yeah. 20 Q. Thank you. So if we just have a look at the 21 fact that it was sent to a number of people, 22 including you, Marie Cockett, John D Cole, Keith 23 K Baines, David X Smith, Richard W Barker and 24 Rod Ismay. 25 In that first paragraph -- sorry, just 100 1 again, also just to look at "Castleton -- Marine 2 Drive URGENT URGENT URGENT". So it's clearly 3 very urgent in her mind: 4 "I have received some very good news about 5 this case but now need the business to make 6 an urgent decision about its future conduct." 7 So let's just try to understand, then, who 8 does she expect, in the business, to be making 9 an urgent decision about the conduct of this 10 case? Presumably all the people it's addressed 11 to, yes? 12 A. I would presume that amongst that audience would 13 be the person that she'd be expecting to make 14 an urgent decision. 15 Q. Well, this is a decision about settling the 16 case, so -- 17 A. Right. I was going to ask you what is it that's 18 the decision that she's asking for. So she's 19 asking -- 20 Q. Yes, she's asking for, as we've heard already, 21 there's a common terminology. She's asking for 22 instructions about settling the case. 23 A. Okay, right, right. 24 Q. All right? Because lawyers would not settle 25 a case on their own initiative, would they? 101 1 Obviously, their client has to give instructions 2 on that, yes? 3 A. Yes. 4 Q. You accept that? 5 A. Yeah, and I understand your use of instructions, 6 where you've said instructions to settle the 7 case, so I understand. 8 Q. All right. So she's sent this email to these 9 people and she's expecting these people to be 10 able to give her instructions on settling the 11 case. 12 A. Okay. 13 Q. Yeah? 14 A. Yeah. 15 Q. And you're one of them? 16 A. Yeah. 17 Q. So how did you, as a group, go about giving her 18 instructions? How did you go about making 19 a decision on whether to settle the case? 20 A. Well, I don't know. 21 Q. Again, you don't know? 22 A. No. And I'm sorry, and I know people are 23 recording how many times witnesses say, "I don't 24 know" but I -- genuinely, I can't remember what 25 happened back in 2006 on this. 102 1 SIR WYN WILLIAMS: Well, is it reasonable to assume, 2 Mr Ismay, that Mr Smith made the decision, as 3 the then Managing Director? 4 A. No, well, this was -- this was IT, David Smith. 5 Yes. 6 SIR WYN WILLIAMS: Sorry, my mistake. 7 So is it reasonable to assume that the most 8 senior person on that list, whoever that might 9 be, made the decision or is it fairer to assume 10 that there was a collective discussion but you 11 now have no memory of it? 12 A. I expect there would have been a collective 13 decision and I think, in terms of seniority of 14 the people, I think there's three, so myself, 15 David Smith and Richard Barker would have 16 been -- we were all part of what was called the 17 leadership group, or something, so we were kind 18 of of a similar level. They may have been 19 a little bit more senior because of the breadth 20 of network responsibility, but -- 21 SIR WYN WILLIAMS: So we have narrowed it down to 22 the three people on the list. It may be fair to 23 infer that, between you, you made the decision. 24 One last possibility, was it escalated to people 25 even more senior than you or even to the board? 103 1 A. That's possible. 2 SIR WYN WILLIAMS: Well, do you know whether any of 3 those things happened? 4 A. No. And I'm sorry, I'm genuinely sorry. 5 I can't remember, I don't know. 6 SIR WYN WILLIAMS: What we do know is that it wasn't 7 settled, so someone somewhere must have made 8 these decisions. 9 A. Yeah, so I accept that. A decision must have 10 been made somehow, yeah. 11 SIR WYN WILLIAMS: Right. Okay. 12 MS PAGE: Perhaps we could turn to POL00069775, and 13 to page 2. If we look at this email, which is 14 to Mandy Talbot, following on, it seems, or 15 around the same time. It goes to a similar but 16 slightly different group. It's from Keith K 17 Baines and it's copied to Biddy Wyles, Clare 18 Wardle, John D Cole, Marie Cockett, Richard W 19 Barker, Rod Ismay, Stephen Dilley. Keith Baines 20 is suggesting that, as part -- this is part of 21 the proposed way of perhaps settling the case. 22 A. Okay. 23 Q. He says: 24 "I have a few minor changes to suggest ..." 25 Just to give you the context, Ms Talbot had 104 1 already suggested a wording and he's then giving 2 a proposed rewording of a statement from 3 Mr Castleton to make as part of the proposed 4 settlement. 5 A. Right. 6 Q. He says the revised text suggested is this: 7 "'I Mr Lee Castleton the former postmaster 8 at Marine Drive Post Office, Bridlington admit 9 that a sum of money was owed by me to Post 10 Office Limited as a result of errors which arose 11 whilst I was the postmaster at the above office. 12 I had thought that this debt arose due to 13 a malfunction of the Horizon System but I now 14 accept that I was mistaken and that the debt 15 arose out of human error. I declare that the 16 Horizon System did not contribute to the errors 17 in any way and formally withdraw all statements 18 I made to the contrary'." 19 Does that ring any bells? Do you remember 20 this desire to have Mr Castleton make such 21 a statement? 22 A. I don't, but I'm clearly part of that chain but 23 I can't remember that, but I am part of that 24 chain. 25 Q. So you've got no recollection of who came up 105 1 with the idea of that -- 2 A. No. 3 Q. -- or how it was that POL had come to the view 4 that it could assert that the debt arose out of 5 human error? 6 A. No, I haven't. 7 Q. No recollection of trying to find out whether 8 that statement would, in fact, have been true? 9 A. No. I haven't got a recollection of that. My 10 recollections are based on the documents that 11 I've got in these packs, including Helen Rose's 12 statement to the court in 2006. 13 Q. Well, one more document, if I may, on the 14 Castleton case, which includes a response from 15 you. So perhaps may provoke more memory. 16 A. Right. 17 Q. POL00090437, and it's page 33 this time. If we 18 look at the email from Mandy Talbot first and 19 then we'll scroll up to your reply. 20 Mandy Talbot to Clare Wardle, Biddy Wyles, 21 Rob G Wilson -- so that's the head of criminal 22 law, isn't it? 23 A. Yes. 24 Q. Rod Ismay, Marie Cockett, Keith K Baines, David 25 X Smith -- so that's again the head of IT -- 106 1 Richard W Barker, Tony R Utting, Graham C Ward, 2 and copied to Doug Evans: 3 "This is just to let you know that we have 4 been completely successful in defending all the 5 allegations made by Mr Castleton. You well 6 recall that he contended that no genuine losses 7 occurred whilst he was a postmaster and that any 8 losses were manufactured by the Horizon System. 9 The judgment has entirely vindicated the Horizon 10 System." 11 She goes on to explain a little more about 12 the technicalities. If we scroll up to your 13 reply, this is from you and back to the same 14 group: 15 "Thanks Mandy -- great news. And thanks to 16 everyone in this email and in your teams as 17 I know you have had to do a lot of work in 18 supporting the defence case here. Like you, my 19 team faced a stack of witness interviews and 20 court attendances at one time so the progress 21 and conclusion here is great news. 22 "What can we do on a proactive comms front 23 here? We've watched the various in inflammatory 24 letters in the SubPostmaster letters page and 25 wanted to be able to assure branches and clients 107 1 ..." 2 Clients? 3 A. Clients as in corporate clients, such as in 4 National Savings or banks -- corporate clients 5 of the organisation. 6 Q. "... that they can rely on the integrity of 7 Horizon. 8 "We've had some good articles in the 9 SubPostmaster about NBSC, Online Service and 10 Cash In Transit. I am planning briefs on what 11 P&BA does. 12 "Any thoughts on comms following this case?" 13 Mr Ismay, you told use you were not 14 particularly concerned or interested in comms; 15 is that correct? 16 A. Clearly this says that I was. So -- and I know 17 that, further to this, there was pictures of my 18 team and a description of what Product and 19 Branch Accounting did that either went into the 20 SubPostmaster Magazine or PO Focus Magazine, so 21 I know we had things about communicating what 22 the nature of the team was at some point during 23 my tenure in that job. 24 Q. In 2007, you were very well aware of 25 a significant number of postmaster complaints 108 1 about Horizon, weren't you? 2 A. Yes, yes, yes. 3 Q. You were, along with others in the chain that we 4 looked at earlier, content to assert that this 5 was completely wrong and it was all down to user 6 error, weren't you? 7 A. Yes, and that was based on lots of the other 8 information, examples of which you haven't 9 shared but which are in the bundle, for example 10 Helen Rose's statement on that case. 11 Q. Was that because user error was an easy cover 12 for failures in Chesterfield procedure? 13 A. No. It wasn't, and I would refer to that other 14 document I've mentioned a couple of times, that 15 the description in that one, the examples where, 16 in a number of cases, auditors would go into 17 branches and find safes open, doors open, money 18 left unattended. It does not mean that it's 19 clear what -- where -- which individual may have 20 taken some money or indeed if they did. 21 However, there were a lot of security 22 situations identified and the examples are in 23 Helen's note on this one, that she submitted to 24 the court in 2006, that says that when they went 25 into that branch, they found the safe open, 109 1 doors open, and the other comments that are in 2 that note. 3 So I would say that, in this case, that kind 4 of description of the circumstances of the 5 experience of the branch audit would have been 6 something that would have influenced the -- my 7 view and others' view in the organisation, about 8 that case. 9 Clearly, if it turns out that there were, 10 you know, genuine allegations about the nature 11 of the system, I realise, as Justice Fraser 12 said, that that calls into question the ability 13 to use that as evidence in the case, but the 14 mindset of the organisation and my understanding 15 was that the audit findings were such as they 16 were and as are described in that bundle 17 document, and that was what would have 18 influenced my thoughts. 19 Now, I couldn't remember that particular 20 document until I've seen it in this bundle but, 21 looking at what was in that statement, that four 22 or five-page statement, that is the sort of 23 thing that would have influenced my thoughts at 24 the time. 25 Q. We see here, don't we, that it's not just 110 1 branches that are on your mind, it's clients. 2 Clients are on your mind. 3 A. Yes. Yes. 4 Q. Because if clients identified discrepancies or 5 problems in accounts coming from Chesterfield, 6 that would present a real problem, wouldn't it? 7 A. If clients were not trusting data, then that 8 would beg a commercial question, and it's 9 interesting that there's certainly a case of 10 something where there was a National Audit 11 Office report about a client that we worked with 12 who was challenging the data that we'd got, and 13 the audit -- the national audit report confirmed 14 that the issue was at the client end not at our 15 end. 16 Q. Thank you. That document can come down. 17 You have agreed, haven't you, with Mr Andrew 18 Winn, that the IMPACT Programme resulted in 19 significant problems with data feeds in Product 20 and Branch Accounting. Yes? 21 A. Yes, I did and I know in the transcript there 22 will be about five or six points I raised 23 yesterday that were those reasons: screens being 24 slow, data coming in and having to be backed out 25 again, yes. Yes. 111 1 Q. You say that you raised your concerns. We 2 haven't seen anything in writing. Did you put 3 your concerns in writing? 4 A. I don't know if I put it in writing or not. 5 I think there's one thing that's in one of these 6 bundles where I did. 7 Q. Well, if we look at your report, which is 8 POL00026572, this is your report for Mr David 9 Smith, MD. 10 A. Right, right. 11 Q. If we look at page 16. This your list of 12 problems with Horizon that you've identified. 13 A. Yeah. 14 Q. (e) is "Horizon/POLFS differences": 15 "In 2005, P&BA moved onto a SAP system 16 (POLFS). This was an exceedingly complex IT 17 migration and there were some issues in 18 management of the cut-off which meant P&BA was 19 out of sync with some branches in terms of 20 opening balances for cash and bureau. This did 21 not affect the integrity of Horizon and has been 22 catered or in error resolution with branches but 23 it has affected service to some branches, 24 ie where decision making on cash supply was 25 based on wrong data centrally. Some issues have 112 1 continued to come to light recently but this is 2 now under control. It is not relevant to the 3 allegations." 4 Is that what you were talking about? 5 A. Yes, that's what I was talking about and those 6 kind of things, although I've said that they 7 were under control, they would have been things 8 that were causing immense frustration in my team 9 about having to deal with those things. And 10 that was the kind of sentiment that Andy was 11 experiencing when he said he could feel, you 12 know, frustration around the team. 13 Q. So, contrary to raising your concerns, you're in 14 fact minimising the problem, aren't you, 15 Mr Ismay? 16 A. Well, I've set out in -- I've set out here that 17 there were issues in my team. I agree that, in 18 there, I haven't said -- and I think the words 19 that I used yesterday was that I was livid about 20 some of the things with the IT team, that the 21 number of file errors, that we were having to 22 put a file -- 23 Q. You don't sound very livid with them here, do 24 you? 25 A. I -- 113 1 Q. "It is not relevant to the allegations". 2 A. No, and I don't think that, writing a document, 3 lividity is necessarily a way of writing 4 a document. But I certainly had conversations 5 with colleagues in IT to say "This is wholly 6 unsatisfactory, the number of files that we're 7 having to wait another day for you to back out 8 and put back in again". I definitely had those 9 conversations. Whether I've put them in emails 10 or not, I don't know, and I should have. 11 Q. Thank you. The document can come down now. 12 Thank you very much. 13 You and POL management generally, no doubt, 14 were worried that big clients like the banks and 15 the utility companies would hear of the problems 16 in your department, no? 17 A. No, I and the Post Office would have been 18 concerned if clients perceived there to be 19 a problem, yes. We would have been concerned 20 that clients would think, "Well, perhaps 21 PayPoint or somebody else can do that work for 22 us". So we wouldn't want to be in a position 23 where the system wasn't working. 24 We felt the system was working, but we felt 25 there was comments, and the description that 114 1 I used in the Cleveleys one, of where IT said to 2 me it was -- there were unfounded allegations. 3 So we felt we were responding to unfounded 4 allegations. 5 I acknowledge, in the context of everything 6 that's coming out in the Inquiry, there's 7 a question about "Well, perhaps it wasn't 8 unfounded", but at the time, I believed from 9 what was being described to me by other teams, 10 who were saying it was unfounded but, obviously, 11 we would have had a concern, would a corporate 12 client look at these potentially unfounded 13 observations and themselves think "Well, we 14 can't trust that organisation, so we'll put the 15 business somewhere else". 16 So, yes, there would have been that concern, 17 but in the context of the organisation believing 18 that it was unfounded allegations. 19 Q. There would have been concern likewise, would 20 there not, about what we call the multis or the 21 big franchises that operated multiple branches. 22 You wouldn't have wanted them finding out 23 either, would you? 24 A. We wouldn't have wanted them to be thinking that 25 the system didn't work either, no. 115 1 Q. No. The solo subpostmasters were a considerably 2 easier target, weren't they? 3 A. No, because I don't think we would have 4 wanted -- clearly some subpostmasters -- 5 Q. Easier to blame user error than to delve into 6 the problems that you didn't want anyone to find 7 out about? 8 A. Could I just respond a bit on that one? So 9 I think -- I know there is criticism in here of 10 was the NFSP not a representative body for 11 subpostmasters? I believed it was 12 a representative body for members and we were 13 having conversations with the NFSP to talk about 14 their perception of issues and allegations that 15 were being made, and they -- members of their 16 Executive Committee that we were at meetings 17 with, who would say, "Well, I'm running a Post 18 Office, I'm not experiencing these issues and 19 the people that I talk to aren't experiencing 20 these issues". 21 So we had what is an awful situation for the 22 postmasters who are concerned in this case here, 23 awful situation for what was -- what we 24 understood at the time was a minority of Post 25 Office branches within the network, and I was 116 1 receiving a vibe from National Federation of 2 SubPostmasters colleagues who talked to lots and 3 lots of subpostmasters, who themselves were 4 saying, "Well, my branch, I don't have these 5 problems in my branch, and the members who I'm 6 speaking to aren't having those problems 7 either". 8 So that sort of feedback that, whilst 9 yesterday, I referred to something where -- 10 which we may come to in a future phase -- four 11 postmasters, I think, came and did some work in 12 Chesterfield to kind of look at things later on, 13 I was having conversations with the executive of 14 the National Federation of SubPostmasters, who 15 they were feeling -- who are users of the 16 system -- that they were assured through the 17 daily practice of using the system. 18 And that's the context, and another part of 19 the context that led to the things that we're 20 talking about here. 21 Q. Mr Ismay, you had a personal interest in 22 suppressing anything that suggested your 23 department was out of control, didn't you? 24 A. No, I -- 25 Q. That's why you were the man to write the 117 1 one-sided 2010 review, isn't it? 2 A. No. No. It's not. I went into a team that had 3 got backlogs that had arisen because of the cut 4 over issues when the migration into the SAP 5 system went in. I had open discussions with the 6 NBSC and you've probably -- with all the access 7 you've probably got some of the slide shows of 8 things where I've got slides presented to the 9 NFSP talking about backlog resolution and 10 a prioritisation of how we are dealing with this 11 with different products to get up to date on 12 that area. 13 I was totally open with the representatives 14 of the subpostmaster community about the 15 backlogs and the -- my acceptance and the team's 16 acceptance of the importance of getting on to 17 having up-to-date timely conversations with 18 subpostmasters, not raising transaction 19 corrections months and months in arrears. 20 And the branch audit team would get in touch 21 with my team to ask about whether there were any 22 error notices pending or transaction corrections 23 to close that loop during the period where 24 there's a backlog, but I was very much keen to 25 be up to date, working effectively with 118 1 subpostmasters. 2 This is a horrible situation that we're in 3 here and I'm sorry about how all this has ended 4 up but I was not trying to conceal something in 5 my team. I was openly, with the Post Office 6 Executive and with the NFSP, who are outside of 7 the Post Office, very clear with them that my 8 team, when I inherited it, was in arrears on 9 things, and it took us quite a time to work 10 through getting up to date on that. 11 But I was not concealing that at all, and 12 there will be things that you will be able to 13 find in back issues of SubPostmaster and Focus 14 that indicate exactly that kind of thing. 15 MS PAGE: Thank you very much for answering my 16 questions. 17 THE WITNESS: Thank you. 18 SIR WYN WILLIAMS: Are there any other questions? 19 MR BEER: Sir, there are not. 20 Questioned by SIR WYN WILLIAMS 21 SIR WYN WILLIAMS: I just want to ask one or two 22 further questions, if I may, Mr Ismay. 23 A. Yes, thank you. 24 SIR WYN WILLIAMS: Really to do something similar in 25 relation to Seema Misra, as you've been doing 119 1 this morning in the Castleton case, but with 2 particular reference to those emails which we 3 pored over yesterday, which were inviting you to 4 agree to further investigations. All right? 5 A. Yes. 6 SIR WYN WILLIAMS: I don't want to put the documents 7 up on the screen; I want to see if my 8 understanding is correct, all right? Please 9 feel free to contradict me. If Mr Beer thinks 10 that I've not got something right, he can 11 intervene, as well. 12 This all started, as I understand it, with 13 the judge in the Seema Misra case, at 14 a preliminary stage, suggesting that the expert 15 witnesses for the respective parties should meet 16 to discuss various issues; all right? And 17 I think that emerges clearly from that email 18 chain that you saw. 19 A. Right. Okay, yeah. 20 SIR WYN WILLIAMS: So, not surprisingly, the expert 21 witnesses did meet, and it was following their 22 meeting that the defence solicitor, Issy Hogg, 23 wrote the email which asked, in effect, for 24 permission to carry out three investigations. 25 We needn't concerns ourselves with the details 120 1 of the investigation. She was asking, "Will you 2 facilitate these further investigations?" All 3 right? 4 A. Okay, yeah. 5 SIR WYN WILLIAMS: And that obviously got its way to 6 the POL Legal team, and in particular Mr Singh. 7 And as I understand it, what you've been telling 8 me is that you would have expected Mr Singh to 9 have communicated directly with you as to 10 whether or not that should occur? 11 A. Yes, I would have expected him to have 12 communicated directly with me, and for him to be 13 the interface point back into the defence with 14 whatever -- 15 SIR WYN WILLIAMS: Yeah, I've got that. That's 16 fine. 17 A. Yeah. 18 SIR WYN WILLIAMS: Now, am I correct, therefore, in 19 thinking that it was for you, ultimately, to 20 make the decision as to whether the requests 21 should be granted, albeit that you expected to 22 have proper input directly from Mr Singh? 23 A. I don't think there was any way in which it was 24 appropriate for me to be making a decision 25 there. I think I would have -- 121 1 SIR WYN WILLIAMS: All right. Well, let's stop at 2 that point, then. 3 Mr Singh clearly is under the impression 4 that you could make that decision. So when it 5 finally came to you, as it did, that you were in 6 effect being asked to make that decision, did 7 you write an email to anyone saying, "This is 8 not for me to determine. It must be determined 9 by Mr X or Ms Y"? 10 A. I don't know. I would expect, if I'd sent 11 an email, it would have been produced in the 12 evidence. So -- 13 SIR WYN WILLIAMS: Right. Well, because what 14 appears to have happened -- and again, I'm 15 choosing my words carefully -- what appears to 16 have happened is that you did engage with it to 17 the extent of discussing it with Andrew Winn. 18 A. Yes, it looks like Andy received the message 19 from Jon Longman, and Accounts came to me, and 20 then I evidently expressed concern about 21 an open-ended invite, and -- 22 SIR WYN WILLIAMS: Yes, sure. You did engage with 23 it with Mr Winn but, as far as you can remember, 24 at least, you didn't send an email to anyone 25 expressing your reservations. That was done by 122 1 Mr Winn? 2 A. Yeah, yeah. Yeah, it was. It looks like it was 3 done by him, yeah. 4 SIR WYN WILLIAMS: Right. So on the one hand -- and 5 you may have a point, if I may say so -- you 6 would have expected that Mr Singh would have 7 communicated directly with you, but is it fair 8 for me to consider that you should also have 9 directly communicated, either with Mr Singh or 10 with someone else who you may wish to identify, 11 "Look, this decision is not for me. Please 12 ensure that it is dealt with by the right 13 person"? 14 A. Yeah, I think it's quite reasonable for you to 15 say that I should have formally corresponded 16 back with Mr Singh about that. 17 SIR WYN WILLIAMS: Right. 18 A. I would have expected, then, him to have come 19 back and said, "Well, I haven't heard from you, 20 Rod. This is a legal requirement. You must do 21 it." And it doesn't look like there was any 22 follow-back. So, given everything that we've 23 got and that we've looked at, I can't understand 24 why there then wasn't some follow-back from 25 Mr Singh to say, "You still haven't done this". 123 1 SIR WYN WILLIAMS: All right. What we do have was 2 an email some weeks later which appears to 3 suggest that you did, in fact, make a decision 4 that those investigations weren't to be 5 facilitated. Mr Beer has asked you about that, 6 so I'm not going to go over that ground again. 7 A. Yeah, yeah. 8 SIR WYN WILLIAMS: But if you didn't make the 9 decision not to facilitate the investigations, 10 do you know if anybody else addressed their 11 minds to that? 12 A. I don't know if anybody else did but, again, I'd 13 think that it should have been a black and white 14 decision for Mr Singh to know should this happen 15 or not? And if it hadn't happened, I would have 16 expected, under the kind of professional 17 processes that a solicitor would go under, that 18 they should think, "This should have happened. 19 It hasn't happened. I need to make sure it 20 happens". 21 SIR WYN WILLIAMS: All right. As far as you were 22 concerned, you have never seen a document in 23 which someone has made a decision, a clear 24 decision, that these investigations would not be 25 facilitated; is that right? 124 1 A. Yeah, yes. That's correct. 2 SIR WYN WILLIAMS: Okay, well, I think have 3 understood it and I don't think you've needed to 4 contradict the way I've expressed it here in 5 terms of your own involvement in this; is that 6 fair? 7 A. Yeah. Sorry, could you ask that question again? 8 I'm sorry. 9 SIR WYN WILLIAMS: Yes. I mean, as we were going 10 through it, you didn't say to me, "Sorry, Chair, 11 you've got that wrong", or, "That's not right", 12 and all the rest of it. So I've got the basic 13 factual chronology correct, have I? 14 A. Yes, I think you have. Would it be possible for 15 me to replay something to you, to make sure I've 16 understood what you -- 17 SIR WYN WILLIAMS: Yes, by all means, yeah. 18 A. My fundamental point is that I really would have 19 expected the solicitors to know whether or not 20 something shouldn't be done, and it was for them 21 to make that decision, not for me to. 22 SIR WYN WILLIAMS: Well, can I put this to you, 23 then, just as a slight nuance, so that nobody is 24 under any misapprehension: it may very well be 25 said by the solicitors -- I don't know, we'll 125 1 have to wait and see -- that they give advice 2 but they don't make the decision. Do you 3 understand? 4 A. Yes. 5 SIR WYN WILLIAMS: Mr Singh may well have said, for 6 example, "My advice to you [either Mr Ismay or 7 Mr X, whoever the decision-maker is] is that you 8 should accede to this request or you should 9 refuse it", and then explain why. But he 10 wouldn't be the ultimate decision-maker. Do you 11 understand the distinction that I'm drawing? 12 A. Yeah, I -- that's helpful. I do understand 13 that. Again, I would have then expected that to 14 be written in some sort of correspondence with 15 him coming back stating that. But what you've 16 said makes sense. 17 SIR WYN WILLIAMS: So you and I are in agreement 18 that there should really be a paper trail 19 explaining precisely what occurred? 20 A. Yes. 21 SIR WYN WILLIAMS: At the moment, at least -- 22 Mr Beer may say I'm not on top of certain 23 documents -- but at the moment, you and 24 I haven't seen any such paper trail? 25 A. Yes, I agree. Yeah. 126 1 SIR WYN WILLIAMS: Fine. All right. Thank you. 2 THE WITNESS: Thank you. 3 SIR WYN WILLIAMS: Thank you very much for answering 4 questions over a day and a half. I think 5 Mr Beer did say that it was possible that you 6 may be asked further questions in due course. 7 If you are to be asked further questions in due 8 course, then, as with this current session, 9 you'll be served with what's called a Rule 9 10 Request outlining the areas about which you 11 should answer questions. All right? 12 A. Okay, I understand, yes. 13 SIR WYN WILLIAMS: Fine. 14 So that brings this session to an end, does 15 it, Mr Beer? 16 MR BEER: Yes, it does, sir. We're back at 10.00 am 17 on Tuesday, please. 18 SIR WYN WILLIAMS: Fine. All right, then. So we'll 19 adjourn until 10.00 am on Tuesday morning. 20 Thanks. 21 MR BEER: Thank you very much, sir. 22 (1.01 pm) 23 (the hearing adjourned until 10.00 am 24 on Tuesday, 16 May 2023) 25 127 I N D E X RODERICK MARK ISMAY (continued) ......................1 Questioned by MR BEER (continued) .............1 Questioned by MR STEIN .......................57 Questioned by MS PAGE ........................72 Questioned by SIR WYN WILLIAMS ..............119 128