Post Office boss Paula Vennells ‘likely’ to have signed off £300k trial bill

Lee and Lisa Castleton lost their business after a costly court battle
Lee and Lisa Castleton lost their business after a costly court battle - Gabriel Szabo/Guzelian

Paula Vennells “likely” signed off a trial bill of more than £300,000 after a sub-postmaster was blamed for a £25,000 shortfall at his branch, the Post Office inquiry heard.

Lee Castleton, 55, was forced to declare bankruptcy in 2007 after the Post Office pursued him through the civil courts.

Mr Castleton was played by actor Will Mellor in the ITV drama Mr Bates vs. The Post Office.

While the father-of-two was targeted with civil action that culminated in a High Court trial, more than 900 other sub-postmasters were wrongfully prosecuted as a result of fictional shortfalls produced by faulty Horizon software.

On Friday, Alan Cook, former Post Office managing director, told the public inquiry how Ms Vennells “likely” signed off the legal budget.

The former chief executive joined the Post Office as its network director and would have been in this role at the time.

Paula Vennells is set to appear before the inquiry
Paula Vennells is set to appear before the inquiry - Unpixs

Questioning Mr Cook on the £300,000 spent, inquiry chairman Sir Wyn Williams said: “What I want to ask you is, what was the process back in 2006 for authorising the expenditure of those sums of money in the Post Office?”

As part of his response, Mr Cook said: “We had delegated authorities in place that would allow people below me, that would have probably lied with Paula Vennells as the network director, would have been able to sign that off.”

Clarifying, Sir Wyn then asked: “So what it amounts to is there would have been a person within the Post Office organisation who would have authority to sign off spending the money without talking either to you or to the board?”

“Correct,” responded Mr Cook.

The inquiry chairman continued: “So did you tell me the most likely person was Paula Vennells?”

Mr Cook replied: “Yes, I think so.”

At another point during his evidence, Mr Cook, who held the managing director role from 2006 to early 2010, was also shown an email in which he blamed sub-postmasters with their “hand in the till” for shortfalls.

‘Hand in the till’

In an email sent in October 2009 to Mary Fagan, former corporate affairs director of the Royal Mail, Mr Cook said: “My instincts tell me that, in a recession, subbies with their hand in the till choose to blame the technology when they are found to be short of cash.”

The pair were discussing increasing press interest about concerns on the accuracy of Horizon.

Asked why it was his instinct to think that sub-postmasters were stealing, Mr Cook told the inquiry: “Well that was an expression I will regret for the rest of my life.

“It is an inappropriate thing to put in an email, not in line with my view of sub-postmasters.”

Mr Cook’s evidence was followed by that of ex-Royal Mail chief executive Adam Crozier, now chairman of BT Group.

Mr Crozier left Royal Mail Group (RMG) in 2010 after seven years as its chief executive, a time in which RMG was the Post Office’s parent company – before it was privatised.

Mr Crozier and Mr Cook both offered apologies to postmasters and their families affected by the scandal.

Lack of knowledge ‘regret’

However, the former executives also both appeared to claim they did not initially know the organisations they presided over that brought prosecutions against sub-postmasters.

Mr Cook, who said he only came to realise this in 2009, after he saw an article about Horizon victims in Computer Weekly, described his lack of knowledge on the subject as a “regret”, saying he had “never come across a situation before that a trading entity could initiate criminal prosecutions themselves”.

Questioning Mr Crozier, Jason Beer KC, lead counsel to the inquiry, asked: “Were you not aware that in fact there was no Post Office legal team – it had no separate legal in-house function and that civil and criminal proceedings were brought by lawyers within the Royal Mail Group legal team?”

Mr Crozier said: “I was not, no.”

Mr Beer said: “So lawyers from within the group gave advice on prosecutions, they made decisions about prosecutions and within prosecutions, and they conducted the proceedings, not any Post Office lawyers, you didn’t know that?”

Mr Crozier replied: “I was not aware of that, no.”

‘I would find that surprising’

The former ITV chief executive, who did not appear in the channel’s drama about the Horizon scandal, was also asked how he would feel about Mr Cook not knowing that the Post Office was initiating its own prosecutions against sub-postmasters.

“I would find that surprising,” Mr Crozier said in response.

Lawyers for Ms Vennells previously released a statement on her behalf that said: “I continue to support and focus on co-operating with the inquiry and expect to be giving evidence in the coming months.

“I am truly sorry for the devastation caused to the sub-postmasters and their families, whose lives were torn apart by being wrongly accused and wrongly prosecuted as a result of the Horizon system.

“I now intend to continue to focus on assisting the inquiry and will not make any further public comment until it has concluded.”