Credit union denies negligence in alleged fraudulent investment lawsuit

A Manitoba credit union says it is not responsible for a Winnipeg man's loss of nearly $650,000 in a fraud scheme.

Peter Squire is suing Access Credit Union and the Royal Bank of Canada after he lost money from his retirement savings to a fraudster in 2022.

Squire filed a lawsuit in September, seeking to recover money he lost after he received an unsolicited phone call from a person identifying himself as a Bank of Montreal senior portfolio manager, referred to in the lawsuit as John Doe. 

The lawsuit says John Doe convinced Squire to make two electronic transfers of funds from his Access Credit Union account in November 2022 — one for $175,000 and another a few days later for $473,290.08.

The funds went into a Toronto RBC account controlled by fraudsters, the lawsuit alleges, and the money was not recovered. 

The lawsuit claims Access Credit Union negligently facilitated the fraud by failing to ask appropriate questions or make appropriate inquiries. 

The credit union filed its statement of defence at Court of King's Bench in Winnipeg on Jan. 15, denying it was negligent and denying that Squire's loss was the result of anything done or not done by the credit union.

Any loss alleged by Squire was due to his own negligence, the court document says, including "pursuing a purported investment opportunity based off of an unsolicited telephone call from an unknown individual." 

The credit union alleges Squire failed "to be wary of unsolicited communications from unknown individuals" and failed to take reasonable steps "to confirm the identity of the purported investment advisor at BMO." 

Squire had alleged in his lawsuit that credit union staff failed to ask appropriate questions about the wire transfers at the time.

In its defence statement, the credit union says it "inquired as to the nature and legitimacy of the first wire transfer" and in response, Squire "assured ACU that the proposed transfer was legitimate". 

The court document says the credit union offered Squire "a bank draft as a lower-risk alternative to the first wire transfer," but Squire declined that suggestion and "insisted" on proceeding with the wire transfer.

The credit union alleges that when Squire went to ACU to do the second wire transfer in the amount of $473,290.08, Squire "again assured ACU that the proposed transfer was legitimate and expressed frustration that ACU was continuing to question the legitimacy of the proposed transfers," the defence statement says.

The credit union again offered Squire a bank draft as a lower-risk alternative to making the second wire transfer, and Squire again declined that offer, the statement says.

Royal Bank of Canada is also named as a defendant in Squire's lawsuit, but RBC has not filed a defence statement.

RBC communications director Cheryl Brean told CBC News in an email that RBC "cannot comment on this matter while it is before the court." 

Access Credit Union has filed a crossclaim against RBC seeking indemnification for any damages the credit union may be found liable to pay Squire from his lawsuit.

The crossclaim alleges losses Squire may have suffered "were caused or contributed to by RBC." 

Access Credit Union chief marketing officer Adam Monteith said in an email to CBC News that the credit union has no comment on ongoing litigation. 

Contacted by CBC, Squire said "I'm certainly keen to see the statement of claim proceed," but that he'll leave the rest to his lawyers.