Fujitsu manager branded bankrupted sub-postmaster a ‘nasty chap’, Post Office Horizon inquiry hears

A Fujitsu manager told a colleague tasked with presenting evidence in Post Office prosecutions that a sub-postmaster was a “nasty chap” intent on going “all out” to damage the company’s reputation, the Horizon IT Inquiry heard.

Lee Castleton, 55, was blamed for a £26,000 shortfall at his Yorkshire branch in 2004 and declared bankruptcy three years later after the Post Office took his case to the High Court.

He was one of hundreds of sub-postmasters pursued through the courts in civil and criminal prosecutions by the Post Office after glitches in the Horizon system left losses on counters that did not exist.

However, an email presented to the inquiry on Thursday revealed how manager Peter Sewell branded Mr Castleton a “nasty chap” who was “all out to rubbish the FJ [Fujitsu] name”, ahead of his 2007 legal battle.

Mr Sewell, who was part of the Post Office Account Security Team at Fujitsu, also made a crude reference to Fetter Lane – where the High Court is situated.

In court, Mr Sewell appeared shocked when presented with his own words – telling Julian Blake, counsel for the inquiry: “I don’t remember writing it, but obviously I did. But I certainly don’t understand it.”

The email was sent to Andy Dunks, an IT analyst Mr Sewell managed, who was due to present Horizon evidence in the Castleton case.

Sent in December 2006, Mr Sewell’s email read: “See you in court then.

“Fetters [Fetter] lane is where they used to hang people out to dry. I don’t suppose that type of thing happens any more though.”

He added: “That Castleton is a nasty chap and will be all out to rubbish the FJ (Fujitsu) name. It’s up to you to maintain absolute strength and integrity no matter what the prosecution throw at you.

“We will all be behind you hoping you come through unscathed. Bless you.”

In response, Andy Dunks wrote back: “Thank you for those very kind and encouraging words.

“I had to pause halfway through reading it to wipe away a small tear… Bless you all….”

Speaking to The Telegraph less than an hour after seeing the email, Mr Castleton said: “I don’t know either of the people mentioned in the email – and I would have thought you would need to meet someone to make a judgment like that.

“Let’s face it, we know exactly what kind of people we are dealing with, it’s a group of people who were out to ruin me, so in that sense it doesn’t surprise me.”

He added: “Hanging me out to dry? That is exactly what they did to me and that is the ethos of both companies [Fujitsu and Post Office].”

He later attended the inquiry’s afternoon session along with former sub-postmistress Jo Hamilton, who was wrongfully convicted as a result of the faulty software.

Both of their stories were depicted in the ITV drama Mr Bates Vs The Post Office.

Mr Blake sprung the email on Mr Sewell shortly before the hearing broke for lunch.

It followed Mr Sewell being asked whether he saw “protecting Fujitsu as an important part of [his] job”.

After failing to answer the question to Mr Blake’s satisfaction twice, Mr Sewell eventually said: “We will protect our own companies. Yes.”

Mr Blake then produced the email and asked him: “Is that typical of your approach to the work that you’re doing?”

“No, no. I don’t know why that was written,” Mr Sewell replied.

He then added: “I don’t know why…I don’t remember writing it but obviously I did. But I certainly don’t understand it.”

Sewell accused of ‘egging on’ Dunks

Later, Flora Page, a barrister representing Mr Castleton and several other affected sub-postmasters, accused Mr Sewell of “egging on” his colleague and “urging him into battle against Mr Castleton”.

“What you say to reassure him is ‘don’t worry, he’s a nasty man’. How did you form that opinion Mr Sewell?” Ms Page asked.

“I don’t know. I don’t know why I wrote it, I apologise,” Mr Sewell responded.

“You were egging Mr Dunks on weren’t you? Urging him to go into battle with Mr Castleton weren’t you?” said Ms Page.

She continued: “You will know by now that Mr Castleton was hung out to dry?”

Mr Sewell replied: “I know a lot more about it now than I did, yes.”

On Friday, the inquiry will hear evidence from Paul Patterson, the director of Fujitsu’s European arm.

Earlier this week he told MPs and victims he was “truly sorry” for the firm’s part in the “appalling miscarriage of justice”.

He also said that the Japanese company had a “moral obligation” to contribute to compensation for victims.

04:38 PM GMT

Goodbye and thank you for joining us

We are ending our live coverage here as the Post Office inquiry wraps up for the day.

Three Fujitsu employees, Gerald Barnes, a software developer, Peter Sewell, a former project and operations manager, and Donna Munro, a former systems management team leader and security operations manager, have addressed the inquiry today.

In an email shown at the public inquiry, Mr Sewell described sub-postmaster Lee Castleton as a “nasty chap”, despite Mr Castleton denying he had ever met the former Fujitsu manager.

Keep checking the Telegraph website for the latest stories on the Post Office scandal including reaction and a full report on the evidence heard today.

Thanks for following.

Read more: Everything you need to know about the Post Office Horizon scandal.

04:36 PM GMT

'Gaping hole' in prosecution support after Fujitsu employees refused to testify

An email sent by Ms Thomas to Ms Munro on January 13 2012 warned she faced a “gaping hole as far as prosecution support is concerned” after two other Fujitsu employees refused to give evidence at trial.

Correspondence between several Fujitsu employees showed Andy Dunks felt “his knowledge was not good enough” to answer questions in court, while employee Rajbinder Bains was “not prepared to submit” a statement.

Ms Patrick, who is representing several sub-postmasters, asked Ms Monroe: “She’s raising a substantive issue about what evidence the members of your team are qualified to give - is that fair?”

Ms Munro replied: “It’s not writing what they’re qualified to give, it’s what they’re comfortable to give.”

Ms Patrick continued: “There appears to be a hole in your team in terms of the prosecution support you’re able to provide - is that fair?”

Ms Munro: “From what we’re reading here, that could be assumed, yes.”

Ms Patrick: “So, she’s raising a gaping hole and is that not an important gaping hole in prosecution support?”

Ms Munro: “Yes.”

04:00 PM GMT

'Robustness of Horizon system was misrepresented during prosecutions'

A sharp but effective question from the lawyer of another interested party.

“Based on what you’ve seen today, do you consider that sub-postmasters were being prosecuted in circumstances where the Post Office, with Fujitsu’s assistance, was misrepresenting the robustness and integrity of the system?”

Ms Munro said: “Based on what I’ve seen and read today, I would say yes.”

03:52 PM GMT

Final questioning of former Fujitsu technician

One final question from Ms Price to Ms Munro on whether she knew there was remote access to data.

Ms Munro said: “I was aware that they had remote access. I wasn’t aware that they had the ability to amend any data in there.”

Ms Price: “Had you been aware, would this have been a cause of concern for you?”

“Yes, because you shouldn’t be able to manipulate data,” replies Ms Munro.

03:37 PM GMT

‘Standard Fujitsu witness statements’ created to address transaction issues

The inquiry has been shown emails sent between Fujitsu staff about a “very significant problem”, with Penny Thomas, the sender of the emails adding: “In a nutshell the HNG-x application is not removing duplicate transactions (which may have been recorded twice on the audit server) and they are appearing in the ARQ returns.”

She adds: “I attach a standard witness statement with modifications for duplicate transactions which Gareth has already reviewed.”

Emma Price, who is questioning Donna Munro today, asked: “Do you recall there being a standard Fujitsu witness statement which was used by litigation support?”

Ms Munro responds: “I recall they had a template, yes.”

The template, which is then shown to the inquiry, refers to the duplicate transaction issue.

However, a later line reads: “There is no reason to believe that the information in this statement is inaccurate because of the improper use of the system.”

“To the best of my knowledge and belief at all material times, the system was operating properly or was out of operation was not such as to affect the information held within it.”

This template statement was sent on July 7 2010 – more than four years before prosecutions were halted.

Ms Price asked Ms Munro: “Do you remember receiving and reading the draft statement circulated by Ms Thomas with that proposed working?”

Ms Munro: “No, I don’t recall receiving or reading it.”

“Would you, having seen that email chain, have read the statement that was attached to the email which you were copied in to?,” asked Ms Price.

Ms Munro said: “I would have, if it was sent to me direct, not as a copy.”

03:19 PM GMT

Scottish Government to develop own legislation exonerating sub-postmasters

The Scottish Government is working on its own legislation to exonerate those wrongly convicted in the Post Office Horizon scandal, Humza Yousaf said as he told how there could be “complexities” with Westminster acting for all of the UK.

The Scottish First Minister said he believes the “easiest and quickest route” would be for legislation being brought forward by the UK Government to clear the names of those who suffered a miscarriage of justice to apply in Scotland as well.

But with the issue of justice devolved, he told MSPs “there are complexities to work through” for that to happen.

He stressed he had received a “positive” response after writing to Rishi Sunak, the Prime Minister, on the issue, but said the Scottish Government is already looking at “contingencies” which could see it bring forward its own legislation.

03:15 PM GMT

Scandal victim arrives at inquiry to hear evidence

Jo Hamilton, a former sub-postmistress, has just arrived at the inquiry and taken a seat.

She is not giving evidence today, but like other victims of the scandal, she has chosen to hear the evidence in person.

02:57 PM GMT

Questioning of former Fujitsu technician has begun

Following a short break, Donna Munro has now taken the stand.

Mrs Munro confirms that she held a technician role at Fujitsu in the early 2000s and monitored the Horizon rollout as part of her job.

02:54 PM GMT

Fujitsu manager accused of urging staff ‘into battle’

Lee Castleton’s lawyer has accused Mr Sewell of “egging on” Mr Dunks and urging him “into battle” with her client and other sub-postmasters.

Before lunch, the inquiry was shown a 2006 email in which Mr Sewell described Mr Castleton as a “nasty chap” who was out to “rubbish Fujitsu’s name”.

Mr Dunks responded with an email which read: “Thank you for those very kind and encouraging words I had to pause halfway thought reading it to wipe away a small tear… Bless you all….”

Quizzing Mr Sewell at the end of his evidence session, Flora Page, representing Mr Castleton and a number of other sub-postmasters, said: “Was this your pep talk to your team member that you were managing before he had to give evidence?”

Mr Sewell said: “No, it wasn’t a pep talk, no.”

Ms Page: “You’re saying – don’t worry we’re all behind you, aren’t you?

“That’s what it says,” said Mr Sewell.

“What you say to reassure him is ‘don’t worry, he’s a nasty man.’ How did you form that opinion Mr Sewell?” Ms Page asked.

“I don’t know, I don’t know why I wrote it, I apologise,” Mr Sewell responded.

When asked what was said within Fujitsu to make him form that opinion, Mr Sewell said: “Nothing.”

And when questioned whether this was the opinion he formed “of all sub-postmasters who took issue with the Post Office”, Mr Sewell said: “Absolutely not.”

“You were egging Mr Dunks on weren’t you? Urging him to go into battle with Mr Castleton weren’t you?” said Ms Page.

She continued: “You will know by now that Mr Castleton was hung out to dry?”

Mr Sewell replied: “I know a lot more about it now than I did, yes.”

Ms Page also asked the Fujitsu manager if he said this before he gave evidence against Seema Misra, a former sub-postmistress.

He said: “No, I didn’t.”

Ms Page continued: “The attitude towards sub-postmasters that you encouraged in your team must have been one they carried into court whenever they gave evidence against sub-posmasters, is that right?

Mr Sewell said: “I don’t believe so.”

02:43 PM GMT

Post Office did not want ‘specific details’ in witness statements

An email sent by a former Fujitsu employee showed the Post Office did “not want specific details” included in witness statements provided to the court.

On Jan 8 2009, Penny Thomas wrote: “POL [Post Office Limited] clearly do not want the specific details of this incident included in the witness statement.”

Her email related to an event involving a “financial imbalance” at one particular Post Office branch.

Further correspondence, sent by David Possnett, a Post Office investigator, reiterated these concerns over the content of Fujitsu witness statements.

He wrote: “Why inform anyone about a problem we’ve had within the network but possibly only at one branch, if it bears no relation or relevance?”

The paragraph in question identified an issue experienced at a Post Office branch in December 2007, where a “financial imbalance was evident and was subject to investigation by Fujitsu’s Service Support Centre (SSC) and Post Office Limited.”

The original witness statement said: “Testing of that correction has established that the unmonitored error does not occur elsewhere in the system.”

When questioned on his knowledge of this discussion, Mr Sewell said: “I’ve read the paperwork and obviously, I’ve picked up on it by reading the paperwork.”

To this, Mr Blake asked: “But it’s not something that stood out at the time?”

Mr Sewell responded, “No.”

02:21 PM GMT

Sub-postmaster had ‘never met’ Fujitsu manager who branded him a ‘nasty chap’

Speaking less than half an hour after he discovered an email branding him a “nasty chap” existed, Lee Castleton, a former sub-postmaster, said he had never met either Mr Sewell or Andy Dunks.

He said: “I only found out about the email about twenty minutes ago, when a barrister sent me a screenshot.

“I don’t know either of the people mentioned in the email – and I would have thought you would need to meet someone to make a judgement like that.

“Let’s face it, we know exactly what kind of people we are dealing with, it’s a group of people who are ruin me, so in that sense it doesn’t surprise me.”

He added: “Hanging me out to dry? That is exactly what they did to me and that is the ethos of both companies [Fujitsu and Post Office].”

The inquiry was shown an email sent from Mr Sewell, a former Fujitsu manager, in 2006 about Mr Castleton to Mr Dunks, who he managed at the time.

The email read: “See you in Court then. Fetters Lane is where they used to hang people out to dry. I don’t suppose that type of thing happens any more though.

“That Castleton is a nasty cheap and will be all out to rubbish the FJ [Fujitsu] name, it’s up to you to maintain absolute strength and integrity no matter what the prosecution throw at you. We will all be behind you hoping you come through unscathed. Bless You.”

02:01 PM GMT

Fujitsu will contribute to sub-postmasters’ compensation payments

Fujitsu has confirmed it will contribute to compensation payments to Post Office sub-postmasters wrongfully convicted in the Horizon IT scandal.

The Japanese technology firm offered its “deepest apologies” to wronged sub-postmasters and their families in a fresh statement on Thursday.

Fujitsu said it will co-ordinate with the UK Government over its response, including providing funds to compensate victims.

It said it is co-operating with the public inquiry, which is examining “complex events that have unfolded over many years”.

“The Fujitsu Group hopes for a swift resolution that ensures a just outcome for the victims,” it said.

Fujitsu’s European boss first hinted at the group providing cash to postmasters during a grilling by MPs from the Business and Trade Committee on Tuesday.

Paul Patterson said the technology giant has a “moral obligation” to contribute to compensation, admitting to “bugs and errors” in the Horizon system.

01:49 PM GMT

Fujitsu won't bid for Government contracts ‘whilst inquiry is ongoing’

Fujitsu will not bid for Government contracts whilst an inquiry into the Post Office Horizon scandal is ongoing, Alex Burghart has said.

Speaking in the Commons, Alex Burghart, a Cabinet Office minister, said: “This morning [the] Cabinet Office received a letter from Fujitsu voluntarily undertaking not to bid for Government contracts whilst the inquiry is ongoing, unless of course the Government ask them to.”

It comes amid calls for the company to be blocked from bidding for future contracts.

He was responding to Conservative former cabinet minister Sir David Davis, who called for companies like Fujitsu to be blocked from bidding for future Government contracts on the basis of having “terrible track records”.

Sir David asked the Commons: “Will the Government give further serious thought to blocking large companies like Fujitsu with terrible track records from bidding for future contracts, and if absolutely necessary legislate accordingly?”

Since 2012, the public sector as a whole has awarded Fujitsu almost 200 contracts worth a combined total of £6.8 billion, according to analysts Tussell.

About 43 of those contracts are still in operation, worth a total of £3.6 billion, including the contract for Horizon.

It also has contracts with multiple Government departments including the Home Office, the Foreign Office, Defra and the Ministry of Defence.

01:47 PM GMT

Inquiry on lunch break

The inquiry has currently paused for lunch. Proceedings will resume at 2pm.

01:04 PM GMT

Cost was ‘major player’ in delays to Horizon IT system updates

Internal Fujitsu documents proposing a change to Horizon have been shown.

A conclusion reads: “While, we do not believe that (due to time constraints) it is practical to introduce this change into Horizon, it is required to ensure the viability of the ongoing Prosecution Support service within HNG-X”

Yesterday, the hearing heard that “cost” was an issue when Fujitsu staff were considering changes.

Mr Blake asked Mr Sewell: “Would you agree with the cost issue as well as time?”

Mr Sewell said: “That was a major player in this yes, the cost of introducing it into the legacy system, yes.”

Mr Blake pressed on: “People were, during this period, being prosecuted or there were court cases that were going on relating to the Horizon system.

“It might be asked why it wasn’t seen as sufficient priority in those circumstances?”

He is talking about the early release of a change.

“Why do you think a more reliable solution couldn’t have been implemented earlier?”

Mr Sewell replied: “For cost as much as anything, and resource availability, and I think it would have approved of the whole HNG-X proposals pushed back.”

12:58 PM GMT

Former Fujitsu manager insists he ‘didn't review any witness statements’

Mr Sewell has insisted he “didn’t review any witness statements”.

He has told the inquiry that he was named in documents, but it was staff underneath him who carried out the work.

This continues to be a running theme throughout his evidence today.

12:45 PM GMT

Former employee ‘expressed concerns’ over court witness statements

Penny Thomas expressed concerns over witness statements being used in criminal and civil proceedings, according to documents shown to the inquiry.

The correspondence from Ms Thomas read: “I do not believe we should send any further standard witness statements until we have a chance to discuss what was said last week and the implications. I currently have three outstanding.”

Mr Blake continued: “So she, at that stage, raises quite serious concerns about the content of witness statements arising from this issue. And this isn’t something you recall?”

Mr Sewell: “I would think that’s got something to do with the manual exercise that was going on, the manual check-in of events.

Mr Blake continued: “Was this not a matter that needed to be brought to the attention of very serious people within Fujitsu?”

Mr Sewell: “I don’t remember.”

12:36 PM GMT

'Some people may be struggling to understand what you did’

Peter Sewell has been asked by Mr Blake why he did not involve himself more in the details and integrity of data provided to the court by Fujitsu during prosecutions of sub-postmasters.

Mr Blake told Mr Sewell: “Some people might be struggling to understand quite what you did?

“What did you see as your role if not to get involved in things like witness statements or if not to get involved in something where you are named as the change owner?”

To this, Mr Sewell replied: “I relied on other people with the technical knowledge to give me the advice.”

The exchange continued with Mr Blake asking: “Do you not think you should have got down into the detail of what was going on given your team’s role with regard to the prosecution of sub-postmasters?”

Mr Sewell: “My detailed knowledge was limited, so I couldn’t get any more involved than I did.”

12:14 PM GMT

‘Technical team should have taken on’ responsibility for checks

Peter Sewell is being grilled on an email sent to him in September 2008 by Penny Thomas, a Fujitsu staff member he managed at the time.

The note read: “As an afterthought, what happened with regards to check event errors for cases we are not advised of? Was someone actioned to deal with that?”

Mr Blake stresses this would have involved looking back at cases as far back as 2003.

However, Mr Sewell tells the inquiry: “[I] don’t remember why that was not done.”

Mr Blake: “Were you the person who was responsible, if it had taken place, to have instigated it?”

Mr Sewell: “I don’t believe so, no.”

“Who do you say should have done that?”, asked Mr Blake.

Mr Sewell says “someone from the design authority or audit system”.

When probed whether he, as someone who managed staff giving evidence in prosecutions, should have instigated these checks, Mr Sewell stood his ground, saying: “I think one of the technical team should have taken it on.”

11:58 AM GMT

‘Not enough evidence’ found to warrant continued Horizon system reviews

Peter Sewell is now being shown an email which followed a meeting held on Sept 3 2008.

Sent to Mr Sewell and others, it refers to a PEAK, which triggered a “review of the audit mechanism and the Horizon counter’s behaviour”.

The email reads: “This review has been going on over the last two weeks.”

It goes on to say that the “conclusion” is that there was “not enough evidence to warrant” continuing the review further.

Again, Mr Sewell says, “I don’t recall” when questioned on the document’s meaning.

11:39 AM GMT

Short break before questioning resumes

The inquiry is now taking a 15-minute break.

11:32 AM GMT

EPOS system issues were 'endemic', according to memo

Mr Sewell is noticeably defensive when shown a memo by Gerald Barnes in 2008, which describes issues with the EPOS system as “endemic”.

“I don’t understand this,” Mr Sewell tells the inquiry. “This is Gerald Barnes. Yes. He’s one of the technical guys in the SSC.”

Mr Blake summarises how Mr Barnes explains the issue in lay terms, “as effectively an error that is silent to the postmaster”.

However, Mr Sewell again states this is something he wouldn’t know.

Mr Blake: “Was that something that was explained to you?”

Mr Sewell: “I don’t know, I don’t recall.”

Mr Blake: “Would that be a concern to you?”

Mr Sewell: “If I was involved at this level, yes I guess so. But I wasn’t.”

Mr Blake: “But you were the manager of a team that provided evidence in prosecutions of sub-postmasters?”

Mr Sewell: “Yes, I don’t think I recall this at all.”

11:19 AM GMT

Ex-Fujitsu employee ‘didn't like the way' system faults witness statement was written

Mr Sewell has been questioned further on the email sent to him by Penny Thomas, a Fujitsu staff member, in 2005.

He replied: “What about the paragraph that starts with ‘none of these faults relate to etc’ is this now acceptable to provide this response once we have examined fault logs.”

The inquiry is shown the relevant line from the first draft, which reads: “None of these calls related to faults which would have had an effect on the integrity of the information held on the system.”

Ms Thomas responds with: “I agree. I’ve scoured it out. I will now send to Graham Ward.”

When asked about his response, Mr Sewell tells the inquiry: “I don’t think I liked the way it was written.”

11:00 AM GMT

'I didn't involve myself with any of the witness statements’

Peter Sewell has been shown an email sent to him in 2005 by Penny Thomas, a Fujitsu staff member he previously managed - which contained the first draft of a witness statement written by her.

Asked what involvement he had in the standard template being circulated, he said: “Not a great deal, I didn’t involve myself with any of the witness statements.”

When questioned as to why the document had been sent to him, he continued: “I think out of a standard way of letting someone see what she had done, and I was that person, as I was a manager.”

10:56 AM GMT

Peter Sewell was a 'development team manager' during Horizon rollout

Peter Sewell has told the inquiry he joined ICL in 1997 and would have “probably been a manager of the development team” in 2000 during the early stages of the Horizon roll out.

Julian Blake asked him: “So you were on the technical side?”

Mr Sewell: “No, I was the manager.”

In 2007, he became the operations team manager of the Post Office Accounts security team.

When asked what that involved he said: “It really managed the team of three or four people in the security team who carried out various security processes and functions.”

10:43 AM GMT

Peter Sewell takes to the stand

Mr Sewell, a former Fujitsu operations team manager, will be questioned by Julian Blake.

10:35 AM GMT

Questioning of Gerald Barnes begins

Emma Price, counsel to the inquiry, has begun by questioning Gerald Barnes on a case relating to a Post Office branch in Apex Corner, London, which was taken to the Court of Appeal by the sub-postmaster.

A spreadsheet showed 13 “missing transactions” for March 2008, which had been “marooned” on the counter at Apex Corner.

Putting Mr Barnes’ evidence to him, Ms Price said this was “discovered in April 2008 by the Software Support Centre” and the staff then “manually re-inserted these marooned transactions into the Legacy Horizon correspondence” using a “virtual counter ID”.

Ms Price has asked whether it was the the fact this action was taken a “month after they [the transactions] were actually done that caused a problem”.

Mr Barnes said: “That’s right exactly – the key thing here is that it was a month afterwards, if they’d done it very quickly, there wouldn’t have been a problem.”

As the Court of Appeal case related to Apex Court is still ongoing, Sir Wyn Williams, the chairman, has said the Inquiry will have to “tread carefully” around this data.

Mr Barnes has how finished giving evidence.

09:52 AM GMT

Who is due to give evidence?

Good morning and welcome back to the Telegraph’s Post Office Horizon IT Inquiry live blog.

This morning we will hear from two more Fujitsu staff – but the hearing will begin with more evidence from Gerald Barnes, the software developer who went on to join the company’s audit team.

Mr Barnes previously told of how he worked on numerous technical tasks and flagged concerns about how bugs could impact upcoming court cases.

Once Mr Barnes has finished giving evidence, Peter Sewell, Fujitsu’s former project manager and operations team manager at the Post Office account security team, will be questioned.

His seniority could see him asked direct questions about decisions made by himself and the company.

Donna Munro, a former systems management centre team leader and security operations manager at Fujitsu, is also expected to give evidence today.

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