Cambridge woman explains how scammer e-transferred thousands out of her bank account

Sydney Dinsmore of Cambridge, Ont., thought it was odd when she received a verification code for a dormant bank account in March 2022.

She says spoke to an employee at her Bank of Montreal branch in March 2022, but was left with the impression that she didn't need to worry about it.

But then in November 2022, she received two verification codes, which she didn't notice immediately as she was on a family road trip.

She didn't realize anything was wrong until an email arrived from BMO telling her that the account balance had dropped to below $100 after $4,000 had been taken out of the account. It was a withdrawal she didn't make or set up.

"What had apparently happened was that a payee had created an unauthorized pay and basically wiped out the account," Dinsmore said.

"It wasn't a payee that I had ever heard of, it wasn't a payee that I would ever use. And I then looked back into my messages when I saw that the verification codes had been sent two days prior."

Dinsmore asked the bank for a reimbursement, but says she was denied.

She filed a request with the fraud department at BMO and spoke to the bank's ombudsman but the issues was not resolved.

Dinsmore is one in a group of now over 140 BMO customers who have banded together to sue the company.

All the claimants say they lost money after their accounts were hacked, usually thousands of dollars at a time. Since CBC first reported the lawsuit in early April, the number of claimants had doubled.

CBC News reached out to BMO for a comment about the e-transfer fraud the claimants say affected them. The bank issued a statement.

[The bank] is "determined" to work with government and policymakers "to help Canadians defend themselves against scams," read the statement.

"We are always open to reviewing cases when new information becomes available and will be reaching out to our customer to discuss this matter."

E-transfer fraud cases increase

Canadians involved in a dispute with their bank can seek out the Ombudsman for Banking Service and Investments (OBSI). The group is responsible for handling the financial disputes of consumers and small businesses that could not be resolved in an initial complaint.  

Mark Wright, the director of communications and stakeholder relations, told CBC K-W that overall, banking cases have increased 248 per cent between 2022 and 2023.

"This unprecedented growth of volume in bank related complaints was in large part due to changes to the Bank Act Consumer Protection Framework that came into effect on June 30, 2022, which reduced complaint attrition at federally regulated banks," Wright said.

"That said, e-transfer fraud complaints are a significant and increasing concern over the past three years."

Of the OBSI e-transfer fraud cases:

• In 2023, there were 594 e-transfer fraud cases opened, representing 25 per cent of total banking cases.
• In 2022, there were 87 e-transfer cases opened, representing 13 per cent of our total banking cases.
• In 2021, there were 27 e-transfer fraud cases opened, representing five per cent of our total banking cases.

140 BMO customers plan to sue bank after alleged transfer frauds

8 months ago

Duration 11:39

A group of more than 140 Bank of Montreal customers from across the country plan to file a class-action lawsuit against the bank, after they say they collectively lost more than $1.5 million in fraudulent e-transfers. CBC’s Angelina King looked into how fraudsters accessed the accounts — and how you can protect yourself.

Verification code looked legitimate

CBC K-W heard from many victims, both locally and across the country, who had a similar story to Dinsmore's — people who were bilked thousands of dollars, in a similar e-transfer fashion. 

Some like Christine McKim-Avey and her husband David from Norwich, Ont., were able to come to an agreement with the bank, but they're not allowed to speak about the details. She explains that when the $15,000 was lost in an e-transfer scam in 2022, their credit card was also compromised at the same time.

"They tried to get a $5,000 cash advance, but the credit card department they caught it, they realized that this was a fraudulent attempt and they would not allow the credit card transaction to go through," McKim Avey said.

"How come the credit card department of BMO could recognize the fraudulent attempt but not my savings account? Because if it had the same security measures on my savings account that was on the credit card, I wouldn't have lost this $15,000."

McKim-Avey says the verification code she and her husband received looked legitimate, took a screen grab and showed a person at their bank branch who did not dispute it looked real.

Mckim-Avey says they found a resolution two years after the money was taken. Two other people from Waterloo region who were also victims of the transfer scams told CBC News they were able to find a resolution.

'They make you feel like it's your problem'

CBC K-W received word from other people across Canada who say their BMO money was taken from their bank accounts after fraudsters somehow got access and sent themselves money through e-transfers, global wire transfers and by setting themselves up as payees for bills.

So far, they have not reached a resolution with the bank.

Nathan Salmon from Dartmouth, N.S., says almost $8,000 was transferred out of his account to four different people — names he didn't recognize.

He said there were five transactions over two different days and it was under his limit of $1,000. Salmon explained he's now receiving security alerts when transfers have been made.

For Dinsmore, the entire ordeal has left her frustrated and she hopes the bank acknowledges that it has holes in its security system and that it failed its customers.

"The banks push online banking. They tell you it's safe and secure. They tell you that they will take care of any problems," Dinsmore said.

"But when you have a problem like this, they make you feel like it's your problem and not theirs."

LISTEN | BMO customer explains how scammer e-transferred thousands out of her account:

The Morning Edition - K-W7:36BMO customer explains how scammer e-transferred thousands out of her account

Sydney Dinsmore thought an alert from her bank that came with a verification code was odd.That's because the account wasn't active.  Eventually she says scammers got into her account and were able to take out four thousand dollars. That was in November of 2022. She hasn't been able to get her money back and has joined a group lawsuit in an attempt to get their money back.