Hundreds of postmasters may have been wrongly convicted for accounting issues related to the use of a second faulty IT system, i can reveal.
An i investigation reveals for the first time the scale of a potential second miscarriage of justice linked to Post Office software that pre-dates the now notorious Horizon programme.
Sub-postmasters claim they were sacked, forced to hand over money and criminally prosecuted as a result of faults with Capture, a piece of software rolled out in the mid-1990s.
An independent investigation into the software, which was launched earlier this year by the previous government, is due to publish its report next week.
Previously there were thought to be at least 40 sub-postmasters and families claiming they suffered at the hands of the Post Office while using Capture.
Data obtained by i under Freedom of Information (FOI) laws now reveals that after the introduction of Capture the number of private prosecutions brought by the Post Office soared from two in 1992 to 93 in 1998.
The following year, when Horizon was introduced, 114 prosecutions were brought, resulting in 107 convictions. Every one of these convictions has now been quashed – but the Capture convictions still stand.
The FOI data means that, for the first time, the scale of prosecutions which coincided with the introduction of Capture can be laid bare.
Those prosecuted by the Post Office under Capture, who were pursued on similar accounting charges to that of Horizon victims, argue they too should have their convictions overturned.
The data clearly shows that before the rollout of Capture began in 1992, annual prosecutions were negligible – in 1992 it pursued two cases of “suppression” and “pension and allowance encashment fraud” but failed to secure convictions in either case.
But in 1996, that number jumped to 31, followed by 60 in 1997 and 93 in 1998. The offences pursued include “audit shortage”, “cash loss” and “false accounting”.
Prosecutions continued at a similar level following the introduction of Horizon. More than 1,000 convictions have been secured in total since 1990.
Since 2016, after the Post Office stopped pursuing prosecutions using Horizon data following a long-running campaign by sub-postmasters, the pattern has returned to that of the early 1990s – with just a single prosecution.
i first revealed claims that more sub-postmasters had been wrongly convicted related to the Capture system in January, after the high profile drama Mr Bates vs the Post Office brought the impact of the Horizon scandal home to millions.
Steve Marston, 68, is an alleged Capture victim who believes he was wrongly convicted of theft and false accounting charges in 1998 after Post Office investigators said £79,000 was missing from his branch in Heap Bridge, Greater Manchester.
Mr Marston insists he never stole “a penny” and that he began suffering accounting problems after the Post Office introduced Capture.
Since then, dozens of other sub-postmasters have come forward to say they believe the software was faulty and they were wrongly made to hand over money, sacked, and in some cases criminally prosecuted.
He believes the figures “paint a clear picture”.
“It’s horrifying,” he said. “The figures are staggering. And what makes it worse, to a certain extent, is that nobody at the Post Office seems to have acknowledged it.
“Why did nobody think ‘why is the number of prosecutions suddenly rocketing?’ Surely somebody had the gumption to sit down and look at the figures and question them?”
Kevan Jones, the former Labour MP who now sits in the House of Lords, has supported Post Office victims for years and believes the scandal goes much deeper than Horizon.
“These figures starkly demonstrate that there is another scandal here,” he told i. “The Post Office need to explain why suddenly they went from zero prosecutions in the early 1990s to 93 in 1998.
“Why did nobody ask the question ‘why have all these sub-postmasters become crooked?’”
Documents previously obtained by i revealed that Capture was developed in-house by the Post Office IT team in Farnborough, Hampshire, and first rolled out to branches in 1992.
Newsletters and bulletins sent out to sub-postmasters showed that the Post Office was aware the software was prone to bugs and glitches and was capable of corrupting accounting data.
But at this time, Post Office investigations into its own sub-postmasters were ramping up.
A separate Freedom of Information request shared with i shows there were “fewer than 5” investigations in 1990, increasing to 198 in 1996, 282 in 1997 and 378 in 1998.
The Post Office’s change in approach towards accounting problems was spelled out in a bulletin sent out to staff in 1996.
In the newsletter obtained by i from March 1996, the Capture IT team advised sub-postmasters that they should also keep “manual” cash books as well as using the computer software.
“The reason for maintaining manual records follows advice from the Post Office Solicitors Office that current automated systems are unable to provide a clear audit trail for transactions or for cash and stock holdings entered at any specific time,” the team said.
“Similarly, the system could not provide an audit trail if any amendments are made to figures without the knowledge of the sub-postmaster.”
The convictions of sub-postmasters under the Horizon scandal have now been overturned after the Government introduced emergency legislation earlier this year.
The Post Office has said it is “concerned” by allegations of wrongful prosecutions involving Capture and is looking into the claims as a matter of urgency.
The Government commissioned US firm Kroll to carry out an independent investigation and a report was provided to the Department for Business and Trade earlier this month.
Carl Cresswell, director at DBT, told sub-postmasters Kroll had been asked “to assess whether the design, implementation, and use of the Capture software package by postmasters could have resulted in those postmasters suffering detriment and/or there were issues with the way Post Office investigated any issues associated with Capture. “
i understands it is to be shared with sub-postmasters and their legal teams on Monday.
If it vindicates claims that Capture was faulty the Government is potentially facing hundreds of new claims for compensation and criminal convictions which need to be overturned.
The previous Post Office minister Kevin Hollinrake suggested alleged Capture victims could apply to the existing Horizon compensation schemes, which have a budget of more than £1billion.
However, the process of overturning criminal convictions could be more complicated.
The Government agreed to use emergency legislation to overturn Horizon convictions because a number of victims had already been exonerated by the Court of Appeal and it would have taken a further 15 years to clear the remaining cases.
No conviction involving Capture evidence has yet been examined by the courts.
It is understood Labour’s new Post Office minister Gareth Thomas has been advised of the findings of the Capture report and will set out next steps in due course.
The Post Office declined to offer further comment on the latest claims about Capture. A spokesperson said previously: “We take very seriously any concerns raised about cases from before the Horizon system was first rolled out in 1999.
“We are particularly concerned about allegations of prosecutions, and we are looking into this along with all available facts about Capture, including whether shortfalls could have been caused by faults in this software, and the potential impacts if so.”
A Department for Business and Trade spokesperson said: “We have received Kroll’s independent report into the Capture system and will be publishing its findings shortly.”
Timeline of Post Office scandal and Capture IT allegations
1992 – Capture IT was first rolled out in branches, with the Post Office promising it would “simplify the task of keeping accounts”.
1995 – Staff bulletins are sent out to sub-postmasters, revealing bosses admitting Capture IT was experiencing a number of faults. One document from Focus – an in-house magazine produced by the Post Office – lists “a few hiccups” with the software processing pensions, currency and automated transactions.
1996 – A spike in private prosecutions by the Post Office begins, with 31 in total.
1997 – The number of prosecutions rises to 60.
1998 – A year before the Horizon IT system is introduced – 93 people were prosecuted. Former sub-postmaster Steve Marston, 67, is prosecuted by the Post Office for theft and false accounting offences.
1999 – Liz Roberts is convicted of theft offences, which her family believes were wrongly based on data from the Capture system. She is sentenced to 13 months in prison. That same year, the Horizon IT system is rolled out in Post Office branches across the UK.
2000 – Alan Bates reports issues with the new Horizon IT system, which replaced the old Capture IT system.
2004 – Lee Castleton is found to have a £25,000 shortfall at his branch. He is made bankrupt after he lost his legal battle with the Post Office.
2010 – Pregnant sub-postmaster Seema Misra is jailed after being accused of stealing £74,000.
2015 – Post Office boss Paula Vennells tells the business select committee there is no evidence of miscarriages of justice.
2017 – Legal action is launched against the Post Office by a group of 555 sub-postmasters.
2019 – A High Court judge rules that Horizon contained a number of “bugs, errors and defects” and there was a “material risk” that shortfalls in Post Office branch accounts were caused by the system. The Post Office agreed to pay out £58 million to the 555 subpostmasters. Post Office boss Paula Vennells is appointed a CBE.
2021 – A statutory inquiry looking into the failings of the Horizon system and the wrongful convictions of subpostmasters begins. The Court of appeal quashes 39 wrongful crown court convictions.
2023 – The Government announces that every wrongly convicted sub-postmaster will be offered £600,000 in compensation.
2024 – ITV drama Mr Bates vs The Post Office airs for the first time. The UK Parliament passes a law overturning the convictions of subpostmasters in England, Wales and Northern Ireland. Scotland passed a similar law that same month. Criminal investigations are launched into the Horizon IT Scandal. King Charles III revokes Vennells’s CBE. i reveals the potential second IT scandal linked to Capture.
By Caolan Magee
