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No money back for P.E.I. CRA fraud victim who used Bitcoins

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Chief Judge Nancy Orr orders cash seized from Bitcoin ATM after CRA fraud returned to machine’s owner

CHARLOTTETOWN, P.E.I. - A P.E.I. woman who gave fraudsters $62,500 after they claimed to be from the Canada Revenue Agency won’t be getting her money back.

On Friday, Chief Judge Nancy Orr ordered that money returned to Instacoin ATM Canada Inc., which is the company that sold the victim Bitcoins she later sent to the fraudsters.

Orr said the evidence established that Instacoin provided a service to purchase a product as the customer required.

“It was not Instacoin who determined where that product went,” Orr said.

During a hearing on the matter in September, the court heard the victim, who is a permanent resident from Iran, got a call from someone claiming to be from the CRA.

That person left a voicemail threatening to have the victim arrested if she didn’t call back.

RELATED: P.E.I. fraud victim paid $62,500 in Bitcoin after threats of arrest, deportation

Through a sophisticated scheme that included calls that appeared to come from the victim’s accountant’s office and from the Stratford RCMP, the fraudsters convinced the woman to pay $62,500 in Bitcoins.

The victim completed that transaction through a Bitcoin ATM at a pizza restaurant in Charlottetown.

City police later got a warrant and seized the victim’s cash from the ATM.

Because of the anonymous nature of Bitcoin, Charlottetown police determined they would never be able to identify the fraudsters.

As she delivered her decision Friday, Orr said neither the victim nor Instacoin committed any wrongdoing.

There was no question the victim thought she was transferring the Bitcoins to the CRA and that she was under duress, but there was no evidence Instacoin was aware of that duress, Orr said.

Orr also said she was satisfied the contract between the victim and Instacoin was to buy Bitcoin, not for Instacoin to transfer it to the CRA.

Instacoin didn’t know where the purchased Bitcoins were going, Orr said.

Although she said it was unfortunate and regrettable the woman was the victim of such a sophisticated fraud, Orr added that the blame was not on Instacoin.

With the money ordered returned to Instacoin, there is a 30-day appeal period during which time the company will have to wait to recover the cash from Charlottetown police.


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