The UK’s High Court has upheld a GBP 9.62 million (EUR 14 million) financial penalty levied againstRoyal Mail for breaches of postal security.
Regulator Postcomm imposed the fine in August last year after reviewing the state-ownedpostal operator’s mail integrity procedures and finding them wanting.
While Royal Mail did not dispute it had seriously breached its licence requirements byfailing to keep mail safe and secure, it appealed to the High Court against the size of thepenalty. But the court, delivering its verdict this week, decided that the fine was proportionateand reflected the losses that had been suffered by customers. It also awarded costs to theregulator.
The most significant weakness in Royal Mail’s procedures, the regulator said, was poormanagement of the recruitment and training of non-contract staff.
Postcomm pointed out that the system Royal Mail had put in place to prevent the loss, theftor damage of mail was not operating effectively and significantly reduced the company’s ability toprotect customers’ mail in 2004 and 2005.
“Our review uncovered serious shortcomings in Royal Mail’s application of its procedures forproperly protecting the mail… and Royal Mail did not dispute these findings,” said Postcomm chiefexecutive Sarah Chambers.“ During 2004-2005, Royal Mail estimated that around 14.6 million letters,packets and parcels in its care were lost, stolen, damaged or interfered with,” she added.
Royal Mail is yet to publish a statement on the court’s decision.
