BMO customer's account emptied of $87K as bank falls for scam
Bank delayed taking financial responsibility for mistake for months
The Bank of Montreal has reimbursed one of its customers following a CBC Go Public story about how the bank wired $87,555 of his inheritance money into the hands of a scammer.
A spokesman confirmed to CBC News on Monday that BMO customer Bruce Taylor has been reimbursed with interest and the funds placed into his account.
“My parents worked all their lives and put that bit away every week and they left it to myself and my sister,” Taylor said earlier. “For 50 years they saved that money and then it’s gone — overnight.”
He had said he’s also upset because for several months his bank failed to take financial responsibility for its mistake.
“I think [BMO was] just trying to wear me out, hoping I would just fade away … or die,” he said.
Taylor is a Canadian engineering consultant who lives and works in Texas. When his account was emptied by BMO, he was in a Houston hospital having open heart surgery.
Because of his experience, he believes other customers should be warned.
“I’m living proof that [the bank’s operations] can be compromised,” he said. “In my opinion, It just means nobody’s money is safe.”
Dormant account targeted
Taylor’s inheritance was in term deposits at BMO until July 2012, when the investments matured. The money was then automatically deposited into a BMO savings account that, as a U.S. resident, Taylor said he doesn’t use.
“This was strictly emergency money that I had left in Canada,” said Taylor.
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In August, someone emailed Taylor’s BMO investment adviser, using Taylor’s email address, saying he needed the money wired to his cousin, immediately.
The impostor's emails had several spelling and grammatical errors.
The scammer then faxed misspelled transfer requests to Taylor’s BMO branch in Grand Falls-Windsor, N.L. – with his account number and an electronic copy of his signature.
“I don’t understand why the Bank of Montreal didn’t scrutinize those faxes,” said Taylor. “You can tell that they were written by someone whose first language was not English.”
Security questions not asked
A bank staffer asked the person by email for a phone number to verify the transfer. The impostor gave a California number — not one in Texas — but the staffer apparently didn't notice that.
The BMO wire transfer confirmations read "confirmed by phone," suggesting the staffer had talked to Taylor. However, he said the staffer had actually called the impostor and failed to ask him security questions, such as his mother’s maiden name.
“The RCMP officer asked her, ‘Why didn’t you ask them?’” Taylor said. “And she said ‘Well, we had a very poor connection.’ That’s not much of an excuse for not asking a security question.”
The BMO staffer then approved and sent two wire transfers, for $47,500 and $40,000, four days apart.
Taylor found out his account had been emptied when he got out of hospital and contacted his investment adviser. She asked him if there had been recent activity with his account and he said no.
“She said, ‘Oh my, someone’s gotten into your account!’ And I said, ‘Well how much money did they get? And she said ‘Oh, they got pretty near everything,’” said Taylor.
“My goodness — that was quite a shock after having open heart surgery.”
Police began investigating, then sent an email to BMO last summer, confirming Taylor wasn't involved.
"The RCMP consider Mr. Bruce Taylor a 'victim' in this fraud and is not being investigated otherwise," said the email from the investigating officer.
Police also said the initial recipient of Taylor's money was another unwitting victim, in Calgary. She does not want to be identified, but she told Go Public she met the scammer through online dating.
RCMP emails to Taylor confirm the impostor told BMO to wire the money to the woman’s TD bank account. She then withdrew it and wired it to Malaysia, via Western Union, as the scammer asked her to, believing the money was his.
“Everybody can be scammed in this way — but the bank doesn’t make higher precautions?" said the Calgary victim.
“This was done too smoothly to be [the scammer's] first time doing it,” said Taylor.
Customer vs. BMO
As soon as RCMP confirmed BMO had been duped, Taylor said he expected the bank to replace his money. Instead, he went through months of wrangling with BMO lawyers and managers.
“I figured that they would fix it because they were such a well-established bank,” said Taylor. “But I don’t think they wanted to admit to their mistake.”
During his yearlong battle over his money, Taylor was also battling cancer. He said he would have used his inheritance money to pay for his expensive cancer drugs, but instead had to work full time.
“No one knows how hard BMO made the year 2013 for me, by not replacing my money,” said Taylor. "I even [worked] for the 45 days that I was taking radiation, too, and it was a tremendous grind.”
Taylor said both he and the RCMP questioned whether the scammers had help from someone working for BMO.
“They had their inside information somehow,” said Taylor.
The RCMP investigating officer emailed BMO, saying, “I now know the monies were withdrawn and sent overseas. Unfortunately, I am still left with one important question, "Who accessed Mr. Taylor's BMO account and how?”
Insider help suspected
That question was raised because the impostor who sent the faxes to BMO included an electronic copy of Taylor’s signature, "Bruce G. Taylor."
He insists that signature is not stored anywhere in his email account, which was likely hacked, or in any of his online banking records, including cancelled cheques.
“The only time I give a signature with my middle initial is like at the bank when you are opening an account. When I sign my name like down here — if I sign a cheque — it’s either just B Taylor or Bruce Taylor. I never use the middle initial G,” he said.
“So that signature, that electronic signature, that came from inside the bank somehow.”
He said he fears overseas contractors working for BMO could be selling or using customer information. Like other Canadian banks, BMO has outsourced much of its information technology work offshore.
“The Bank of Montreal and all the banks in Canada should have all their banking, everything, done within Canada,” said Taylor.
Only after he wrote to BMO’s CEO Bill Downe in frustration — threatening to go public — the bank offered to replace his money.
Reimbursement offer has strings
In a letter to Taylor in January, BMO stated that “the bank has determined it will reimburse you the full amount, subject to the following." There were two pages of legally binding conditions, including Taylor agreeing to have no further claims against the bank.
Taylor had said he was afraid to sign the agreement.
Go Public asked BMO whether, as a result of this case, staff were disciplined or retrained. We also asked about the suspicion the scammer had inside help — possibly offshore — and what, specifically, the bank has done to prevent this happening to other customers.
It didn’t answer those questions.
Initially, BMO’s head of corporate media relations said he hadn’t had time to look at Taylor’s case, because he was too busy announcing the bank’s quarterly profits.
“I was tied up with the work around announcing our quarterly earnings and will try to take a look at this today,” Ralph Marranca said in an email last week.
When Go Public later pointed out he still hadn’t answered our questions, his only reply was, “Kathy, BMO has robust measures in place to prevent unauthorized access to our customers’ accounts. We regularly review and upgrade these measures to protect our customers.”
“The bank has, I think, a lot of explaining to do,” said former RCMP superintendent Garry Clement, who is an expert in this type of crime.
He said BMO should be taking this case more seriously.
“They’ve got to do a better job. They’ve got to get a handle on this. I think they have an onus and a responsibility and they’ve got a way to go,” said Clement.
Banks 'exposing' customer's money
He said he wants all Canadians to know that because of the huge increase in electronic crime, their deposits are now not as safe as the banks have led them to believe.
“The banks are going to have to become more detailed in these areas, and I think it requires a lot more training than what’s been offered so far,” he said.
Clement said he also worries about banks outsourcing IT work to overseas contractors.
“The reservations that I have are — look at some of these countries. If you look at the corruption index they are fairly high up,” he said.
“The bottom line to all of this is criminal activity occurs in a lot of institutions because they have been able to co-opt somebody on the inside.”
The police investigation into Taylor’s case continues.
“The RCMP Federal Policing Unit is conducting an ongoing investigation. Due to the sensitive nature of this file, we cannot discuss any aspect of it at this time,” said the RCMP.
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