Winnipeg retiree who lost close to $650K in fraud scheme sues credit union and bank

A Winnipeg man who says he lost nearly $650,000 in retirement funds to an alleged fraud scheme is suing a credit union and a bank in what the lawsuit calls a case of 'financial elder abuse'.

Peter Squire is suing Access Credit Union and the Royal Bank of Canada after he fell victim to a fraudster in November 2022.

Squire is a 68-year old retiree and a lawsuit he filed Thursday at the Court of King's Bench says senior citizens "are more vulnerable to fraud and financial abuse than other individuals."

The lawsuit alleges the credit union and the bank should have taken steps to prevent the fraud.   

"But for [Access Credit Union's] negligent, reckless or knowing facilitation, the fraud would have been averted," the statement of claim says.

Squire made two electronic transfers of funds from his Access Credit Union retirement account after he got an unsolicited telephone call from someone identifying himself as a Bank of Montreal senior portfolio manager, referred to as John Doe, in the lawsuit.

John Doe gained Squire's trust and convinced him to make two electronic transfers of funds — one in the amount of $175,000, and another a few days later in the amount of $473,290.08, the lawsuit says.

The funds were transferred into a Toronto RBC bank account in the name of B21 Trade (Canada) Ltd. — an account controlled by fraudsters, the lawsuit says. 

It says Squire received information from Winnipeg police in December 2022 that an individual was arrested in connection with the scam while accessing the funds in B21 Trade's account at the Toronto RBC branch. 

Squire subsequently learned that when his funds were transferred to that account, "other frauds were perpetrated on other victims whose funds were also transferred under false pretences to B21 Trade's account," the court document says. 

It says Squire claimed reimbursement from the credit union "but to date [Access Credit Union] has denied all liability for the loss".

Adam Monteith, chief marketing officer for Access Credit Union, said in a statement to CBC News the credit union will not comment on ongoing litigation.

The lawsuit alleges that at the time of the transactions there were red flags suggesting Squire was "possibly being scammed by a third-party fraudster".

It cites examples such as the fact that the instructions were to move all of the money in the retirement account — nearly $650,000 — into the hands of a third party whose relationship with Squire, and whose role in the transaction, were unknown.

"By closing its eyes on the red flags, failing to ask appropriate questions and make appropriate inquiries", the credit union "breached its duty of care to plaintiff and negligently, recklessly or knowingly facilitated the fraud perpetrated against plaintiff," the claim says.

The lawsuit says the plaintiff had a right to protection against financial elder abuse under Manitoba's Seniors' Rights and Elder Abuse Protection Act.

The fraud perpetrated against the plaintiff constituted elder abuse within the meaning of the Act, the claims says. It says the law "imposed an explicit duty on [Access Credit Union] to report elder abuse," should the credit union have a reasonable basis to determine a senior was being abused.

The lawsuit alleges "[Access Credit Union] was required to train its staff to recognize the signs of elder financial abuse and to monitor relationships with elder customers for signs of financial elder abuse."  

When contacted by CBC News, Squire and his lawyer declined to comment on the lawsuit.

The lawsuit seeks an unspecified dollar amount of damages from the credit union and from RBC. 

The lawsuit says "RBC has or should have processes and procedures to detect and deter the opening and continued operations of such fraud-related accounts."

But in Squire's case "either the processes did not exist, were not applied or were applied but failed to identify B21 Trade's account as a fraud-related account."

By allowing B21 Trade to set up its account to receive money from Squire and other fraud victims, "RBC negligently, recklessly or knowingly facilitated the fraud perpetrated on the plaintiff," the lawsuit says. 

An RBC spokesperson in Toronto, Cheryl Brean, said in an email to CBC News "we cannot comment on this specific matter while it is before the court."