It started when a text message popped up on Louanne Cataford's cellphone.
The unsolicited text, from a phone number with a southern Ontario area code, said she could earn $300 a week for up to 20 weeks for having her car wrapped in decals advertising a beverage company — essentially turning her car into a mobile billboard.
About to return to school and eager to earn some extra money, Cataford asked for more details. She heard back within a day.
What Cataford didn't realize was that the offer was a scam.
In the space of two weeks, the 19-year-old college student ended up owing money to her bank.
The scammers got away with nearly $4,000 by knowing the ins-and-outs of the Canadian banking system and using it to their advantage.
Hiding behind a real company
A senior specialist with the Canadian Anti-Fraud Centre, Daniel Williams, said the centre began hearing from victims of the car wrap scam last spring.
Williams said the scammers generally hide behind the names of legitimate companies.
In Cataford's case, after she responded to the text, she was contacted by email by a man claiming to be the promotions manager for Eden Water and Coffee, a legitimate European company.
Cataford asked for more information and received a convincing, detailed reply about how the program worked.
She applied and was approved the next day.
The scammers mailed her a cheque for $3,985, apparently issued by a customs brokerage firm in Fort Erie, Ont.
The scammers told her to deposit the cheque into her bank account.
She was told to keep $300 as an up-front payment and then instructed to deposit the rest, in cash, into the CIBC account of the graphic artist who was to wrap the ad on her car.
The credit union where she banked, the Caisse Desjardins, informed Cataford she had to wait five business days for the cheque to clear.
Once it cleared, Cataford followed the detailed instructions she'd received and deposited all but $300 into the CIBC account.
She never heard from the so-called promotions manager again.
Cleared cheque no guarantee it's legit
A week after Cataford deposited the money in the CIBC account, she was contacted by her credit union.
It informed her the cheque she'd received had been counterfeit, and that she needed to reimburse the Caisse for the full amount of $3,985.
She was pressured to pay up immediately or be prepared to deal with a collection agency.
Cataford was baffled.
Like many people, she thought if her bank cleared a cheque, that was proof it was legitimate.
"That's a misperception that, yes, could be out there," said Mélanie Baillargeon, a senior adviser for security and fraud prevention at the Caisse Desjardins.
Baillargeon said it's important for consumers to know a cheque is never guaranteed.
Ultimately, she explained, clients are responsible for all deposits they make to their accounts. If someone deposits a fraudulent cheque, they have to repay that amount.
In Cataford's case, the five-day hold the Caisse put on the funds was the time it needed to verify that TD-Canada Trust, the issuer's financial institution, would honour the cheque.
In practice, all the issuer's bank does is check that the account exists and that there are sufficient funds to cover the amount on the cheque.
Because the account existed and the funds were there, the cheque issued to Cataford was cleared.
It took a few more days for the Caisse to learn that the cheque had been forged.
"Ninety-nine per cent of the time, the cheque is cleared without any issues," said Baillargeon.
"When it doesn't clear, it's because there's a fraudster involved in the scam, in the transaction, that's playing with the industry rules and the banking system."
Tracing counterfeit cheques
Discovering a fraudulent cheque can take a bank weeks — even months.
Under rules set out by Payments Canada, the financial institution has, in fact, 90 days to return an altered or counterfeit cheque.
The scammers had capitalized on that knowledge.
In Cataford's case, the scammers forged the cheques of Royal Customs Brokers, a legitimate customs brokerage house.
"They used a number of counterfeit cheques, totalling well over $80,000, using cheques with our company name and what used to be our bank account," said Brian Martin, owner of the Fort Erie, Ont.-based company.
Martin said another near victim of the scam, someone in New Brunswick, helped uncover the fraud.
Thinking it odd that the cheque to advertise for a beverage company came from a customs brokerage, the customer asked the bank about it before depositing it.
The New Brunswick bank made its own inquiries, and the scam was uncovered.
Who else loses?
Because it had discovered the counterfeit cheques issued in its name within that critical 90-day window, Royal Customs Brokers got all its money back — unlike the victims who accepted the cheques.
What about the CIBC account that Cataford deposited the money into, at the scammers' instructions?
CIBC won't discuss individual cases.
However, Williams, the Canadian Anti-Fraud Centre specialist, said the account holder is often someone who has also been preyed on by a scammer for their banking information.
In a statement, a CIBC official said only that when a "fraudulent transaction has been identified, we investigate it immediately, and if our investigation concludes that an account holder was the recipient of a fraudulent transaction, we work co-operatively with authorities to take the appropriate action."
For Cataford, a happy ending
After being contacted by CBC Montreal Investigates, the Caisse Desjardins set up a meeting with Cataford, and she was reimbursed the money she deposited in the CIBC account.
The Caisse's investigation, which appears to have been prompted by CBC's queries, showed that Cataford was the victim of a "well-orchestrated scam."
It said financial institutions evaluate such circumstances on a case-by-case basis.
In a statement, the Caisse said the cheque had cleared through the normal clearing process and was then returned to the credit union with a fraudulent cheque notice.
"As Ms. Cataford was able to prove that she had not used or benefited from the $3,685, the Caisse conducted a complete review of the file and agreed to repay the $3,685, which was the amount returned to the fraudsters."
"It's been a heavy weight off my shoulders," said a relieved Cataford.
Unfortunately, not all of the scammers' victims are as lucky.
- 'Vultures' make milllions on text message scams, fraud experts say
- Victims of text message scam plead for more protection from their banks
Since CBC Montreal Investigates published this story, we have been inundated by dozens of emails and phone calls from people across Canada who have received texts inviting them to earn money by having their vehicle wrapped with advertisements.
Many were poised to cash the cheque they'd been sent, until they read Louanne Cataford's cautionary tale.