A 32-year-old B.C. man has been charged by Hamilton police in connection to what authorities call “a complex cyber-enabled fraud.”
According to a July 9 press release from the Hamilton Police Service, the suspect is accused of taking advantage of a cyberattack in order to steal over half a million dollars from a municipal housing affiliate of the City of Hamilton.
The press release describes a cyberattack in February of last year that impacted networks used by city employees and led them putting in “manual workarounds” to get municipal work done. This led to the city’s systems being “more vulnerable to human error and external manipulation,” according to police.
The following month, an employee with Hamilton’s municipal housing office responded to what appeared to be an invoice for services from a “known contractor” asking for payment details for a vendor to be updated, as well as an increase in the amount owing.
According to police, the staff member believed the email was legitimate and therefore sent an electronic funds transfer of more than $550,000 to the designated bank account.
The fraud came to light later in the month when the legitimate vendor said they had not received payment. Hamilton’s auditor general, working with a forensic accountant, traced the missing funds to a numbered company registered to a 32-year-old man based in Surrey, B.C. Investigators determined that the money had been quickly withdrawn and moved through a number of Canadian banks.
With assistance from law enforcement agencies in Surrey, B.C., and Edmonton, Alta., Hamilton Police used video surveillance, bank documents, and voice recordings to follow the money trail and identify the suspect. Authorities were able to recover approximately $417,000 after freezing one of the accounts, but the City of Hamilton remains short $130,000, in addition to incurring costs for forensic accounting and legal services.
The suspect turned himself in earlier this week, whereupon he was arrested and released on an undertaking after giving up his passport. The suspect is scheduled to make his first court appearance on Aug. 14.
According to police, the City of Hamilton plans to pursue restitution in recovering its losses.
The Canadian Anti-Fraud Centre (CAFC) notes that the top three categories of fraud in Canada are identity theft, services fraud, and investment fraud. There were 18,612 reported cases in these three categories in 2024, according to the CAFC.
The CAFC says “fraud is significantly underreported in Canada, with conservative estimates putting reporting to the CAFC at only 5-10% of incidents.”
“Fraudsters are becoming increasingly sophisticated, using advanced tools and tactics to deceive their victims,” it adds.
