A businessman amassed about £1 million by buying euros at " massively favourable" exchange rates from a post office bureau de change, a court heard yesterday.
John Whitehouse bought about 11 million euros through the branch in Rugeley, Staffordshire, before selling them at other outlets just hours later.
Wolverhampton Crown Court was told that the 61-year-old, who runs a plastics recycling firm, could make up to to £20,000 on each transaction, pocketing the profit into his business account.
Stephen John, prosecuting, told the hearing at Brierley Hill that Whitehouse exchanged ever-increasing amounts of sterling at the branch between March 2002 and January 2003.
But although the Post Office had set daily exchange rates for all its bureaux de change across the country, subpostmaster Carl Page gave Whitehouse his own unauthorised rates.
The 37- year- old, from Uttoxeter, Staffordshire, also allegedly withheld banking Whitehouse's cheques until the sums from the currency he sold elsewhere had cleared.
"The rates were massively favourable to Mr Whitehouse... so favourable in fact that... Mr Whitehouse simply took the euros he bought to one of many branches of Thomas Cook and exchanged them back into sterling," said Mr John.
The court heard that the Post Office had two rates for bureaux de change - one for customers buying less than £5,000 of foreign currency and another so-called "special rate" for those buying more than £5,000.
But Mr John said: "He (Whitehouse) was allowed by Mr Page during this period to transact at rates which were of the order of 10 per cent more favourable than the proper authorised special rate.
" The result was that, instead of paying roughly £7.3 million for the euros he bought, it cost him about £6.7 million.
"By the simple expedient of selling on this sum of euros, usually on the same day to branches of Thomas Cook in the Midlands, he managed to amass about £8.2 million.
"£8.2 million minus £7.2 million, which would have been the amount he should have paid... meant he made a profit getting on for a cool £1 million, really for minimal effort."
It was "inconceivable" the transactions were not dishonest because they did not make commercial sense, as both the Post Office and Thomas Cook were losing profit with each exchange, he added.
Whitehouse, from Rugeley, was arrested with £582,000 worth of euros in a holdall outside a bureau de change in Birmingham on January 13, 2003.
He had received the cash less than two hours earlier at the post office and a receipt showed an exchange rate of 1.62.
On that day, the ordinary rate was 1.46 and the "special rate" was 1.4752.
Had the euros been sold back into sterling, Whitehouse would have made a £16,000 profit, simply "for the price of petrol from Rugeley to Birmingham and two hours of his time", said Mr John.
Whitehouse said he had "spotted a niche in the market" and described it as a "magic formula".
Both men insisted they did not know each other socially and Page only got a couple of bottles of wine from the alleged conspiracy as well as the standard £1.16 per bureau de change transaction.
Both men deny conspiring to defraud the Post Office through the unauthorised exchange rates.
Page denies a separate charge of stealing £292,000 from the Post Office.
The case continues.