Horizon scandal: More than £1m claimed as Post Office ‘profit’ may have come from sub-postmasters
More than £1m of unexplained transactions were transferred in to Post Office profit at the height of the Horizon scandal, leaked documents have showed.
The papers seen by Sky News show a snapshot of transfers from a Post Office “miscellaneous client” suspense account over a four year period, up to 2014.
A suspense account is where unexplained, or disputed, transactions remain until they are able to be “reconciled”.
Unaccounted-for transactions were transferred out of the Post Office suspense account and into their Profit and Loss account after three years.
Money latest: Further fall in energy bills expected in summer
Ian Henderson, director of Second Sight – the forensic accountants hired years ago by Post Office – said: “The Post Office was not printing money. It was accumulating funds in its suspense account.
“Those funds belong to somebody, either to third party clients or to sub-postmasters, and part of the work we were doing in 2015 was drilling into that.”
Mr Henderson said they were sacked not long after asking questions about whether Post Office profited from shortfalls paid for by sub-postmasters.
Mr Henderson told Sky News that the money could potentially have come from sub-postmasters’ pockets
More than 900 sub-postmasters were wrongly prosecuted due to faults with Horizon accounting software.
A letter from Alisdair Cameron, the Post Office’s chief financial officer, to Second Sight in February 2015 states some “postings cannot be traced” to “underlying transactions”.
He added: “We are not always able to drill back from the combined totals to itemise all the underlying transactions.”
Please use Chrome browser for a more accessible video player
‘Compensation paid by summer’
Mr Henderson said the letter shows that “the Post Office was benefiting from this uncertainty due to, frankly, bad record keeping, but taking it to the benefit of their Profit and Loss account.”
He maintains that it’s impossible to prove for sure that sub-postmasters’ money went into Post Office profit because of a “lack of granularity”.
He says therefore that it is of “sufficient public interest” that a further independent review into the use of suspense accounts should happen.
Please use Chrome browser for a more accessible video player
Post Office redress delay overshadowed by executive drama
Mr Henderson added: “It didn’t come from thin air, where did the money come from? That’s a fundamental question Post Office have not answered.”
Meanwhile, separately, a secret recording obtained by Sky News indicates that Post Office was trying to gag the independent forensic accountants.
The recording is of a meeting in January 2014 between Second Sight, a lawyer and a Post Office representative.
It took place over a year before the accountants were sacked.
In the conference call there are signs the relationship between Post Office and Second Sight was beginning to weaken.
There is discussion about a contractual confidentiality agreement, a “Letter of Engagement” between the parties.
In the recording Ian Henderson says: “Either, you know, we have unfettered discretion and authorisation to just talk to MPs or we haven’t.
“At the moment, the way the document is drafted, we are prevented from doing that. That’s the issue.”
His colleague at Second Sight, Ron Warmington is heard agreeing.
In another part of the recording there are more concerns raised that the investigators are being blocked from talking to MPs.
Mr Henderson says: “My point is we should not be gagging either the applicant or Second Sight in being able to respond, you know, fully and frankly to MPs who frankly sort of set this whole process in motion.”
The Post Office representative replies saying they’re not trying to gag anybody.
Mr Henderson describes “a point of principle”: “In exactly the same way that when we were doing spot reviews, we disclosed to MPs, when they asked us a specific question, the information provided to us by Fujitsu and by Post Office.
Read more on Post Office scandal:
Post Office ‘agrees’ to submit report on CEO’s behaviour to MPs
Sunak declines to back under fire Post Office boss Read
A Post Office TV drama sequel without the need for actors
“And that’s why it’s so important to establish this principle that there should be no gagging of Second Sight in relation to being able to discuss our investigative work with MPs.”
In the same meeting his colleague Ron Warmington said that if it later emerges that Second Sight have been “effectively gagged” in its dealing with MPs, “it’s not going to be Second Sight they are particularly annoyed with, it’s going to be Post Office.”
The representative responds directly with: “I think that’s something that the Post Office will have to deal with if – if it arises.”
Adding that “some of the terminology in terms of gagging is probably an exaggeration of what it is that is trying to be done here, and at the moment you haven’t signed anything.”
Post Office released a statement in response to the findings: “The statutory public inquiry, chaired by a judge with the power to question witnesses under oath, is the best forum to examine the issues raised by this evidence.
“We continue to remain fully focused on supporting the inquiry get to the truth of what happened and accountability for that.”
Business
Donald Trump tells UK to ‘get rid of windmills’ and says raising windfall tax on North Sea oil is ‘big mistake’
Donald Trump has said the UK is making “a very big mistake” in its fossil fuel policy – and should “get rid of windmills”.
In a post on Friday on his social media platform, Truth Social, Mr Trump shared news from November of a US oil producer pulling out of the North Sea, a major oil-producing region off the Scottish coast.
“The UK is making a very big mistake. Open up the North Sea. Get rid of windmills!”, the US president-elect wrote.
The Texan oil producer Apache said at the time it was withdrawing from the North Sea by 2029 in part due to the increase in windfall tax on fossil fuel producers.
North Sea oil rig. Pic: Reuters
The head of Apache’s parent company APA Corporation said in early November it had concluded the investment required to comply with UK regulations, “coupled with the onerous financial impact of the energy profits levy [windfall tax] makes production of hydrocarbons beyond the year 2029 uneconomic”.
Chief executive John Christmann added that “substantial investment” will be necessary to comply with regulatory requirements.
Mr Trump used a three-word campaign pledge “drill, baby, drill” during his successful election campaign, claiming he will increase oil and gas production during his second administration.
In the October budget announcement, UK Chancellor Rachel Reeves raised the windfall tax levied on profits of energy producers to 38%.
Called the energy price levy, it is a rise from the 25% introduced by Rishi Sunak in 2022 as energy prices soared following Russia’s invasion of Ukraine.
Many oil and gas businesses reported record profits in the wake of the price hike.
The tax was intended to support households struggling with high gas and electricity bills amid a broader cost of living crisis.
Apache is just one of a glut of firms that made decisions to alter their North Sea extraction due to the Labour policy.
Read more
Business, the economy and the pound in your pocket – what to expect from 2025
Energy bills become more expensive
Even before the new government was elected, three companies, Jersey Oil and Gas, Serica Energy and Neo Energy – announced they were delaying, by a year, the planned start of production at the Buchan oilfield 120 miles to the north-east of Aberdeen.
-
Sports2 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports9 months agoStory injured on diving stop, exits Red Sox game
-
Sports1 year agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports3 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike
-
Business2 years agoBank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway