If you have just discovered that money was taken from you through a fraud, the shock can come with shame. People who lose money this way are often careful, intelligent adults: a retiree persuaded by a fake investment platform, a Brampton contractor who paid a forged invoice, a family that wired a deposit to someone posing as a lawyer. How it happened matters less, right now, than what you do in the next several days.
Two legal systems may respond, and they do different things. Criminal law aims to investigate and punish. Civil law aims to compensate. A civil claim is the tool you control yourself, but it costs money and only produces results if there is someone or something to collect from. This article explains how that route works in Ontario, with a realistic view of when it is worth pursuing.
What follows is general information and not legal advice. Fraud cases turn on specific facts, and the best steps can change by the hour in the early stages.
The First 48 Hours
Speed helps more here than in almost any other kind of dispute. Before thinking about lawsuits, take these steps:
- Call your bank’s fraud department. Ask whether a wire or e-transfer can be recalled or held, and ask what they can tell you about the receiving institution. Follow up in writing.
- Report to the police. In Brampton, that means Peel Regional Police, or the police service where the fraud is centred if different. Keep the occurrence number.
- Report to the Canadian Anti-Fraud Centre. This agency collects reports and tracks fraud patterns.
- Protect your accounts. Change passwords, turn on multi-factor authentication and consider placing a fraud alert with the credit bureaus if your identity was used.
- Preserve everything. Save emails with their full headers, texts, app messages, website screenshots, wallet addresses, bank confirmations and phone numbers. Do not tidy up or delete, even if the messages are embarrassing.
Be very wary of anyone who contacts you offering to recover your money for an up-front fee. Follow-up “recovery” scams target people who have already been victimized.
Why a Police Report May Not Be Enough
Reporting matters and a criminal charge may follow, but it is not a collection process. Police decide what to investigate based on their own priorities and resources. Investigations can take a long time, and a conviction requires proof beyond a reasonable doubt. A criminal court can order restitution under section 738 of the Criminal Code, and an unpaid order can be filed and enforced in civil court, but there is no assurance that charges will be laid, that an order will be made, or that the offender has money.
You also do not have to wait for police. A civil case may proceed at the same time, and it uses a lower standard of proof, the balance of probabilities. The police file and the civil file are independent, and a decision not to lay charges does not end your civil rights. That said, the two can interact. Your lawyer might consider the effect of a defendant’s right to remain silent and what materials you hand over or obtain.
What a Civil Fraud Claim Requires
In Bruno Appliance and Furniture, Inc. v. Hryniak, 2014 SCC 8, the Supreme Court of Canada set out four elements of the tort of civil fraud:
- A false representation made by the defendant.
- Some level of knowledge of the falsehood, meaning actual knowledge or recklessness.
- The false representation caused the plaintiff to act.
- The plaintiff’s actions resulted in a loss.
Note the second element. An honest but careless statement is not fraud, though it may be something else, such as negligent misrepresentation. Keep that distinction in mind.
Fraud allegations also have to be pleaded with full particulars under Rule 25.06(8) of the Rules of Civil Procedure. You cannot simply say “the defendant defrauded me.” You must set out what was said, by whom, when and how it was false. Throwing around the word “fraud” carries risk as well. Courts take these allegations seriously, and in Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, the Supreme Court addressed the costs that may follow an unproven allegation of fraud or dishonesty. An unsuccessful allegation does not automatically attract higher costs, but one made recklessly or without foundation can. Have a sound factual basis before you make it.
Other causes of action are often added alongside fraud, depending on the facts: conversion, breach of trust, unjust enrichment and conspiracy. Some of these do not require you to prove the same state of mind.
Finding the Money: Who Else Might Be Reachable?
Often the person who spoke to you is using a false name, or has already moved the funds on. The next question is who else was involved or received the money.
A court can sometimes reach:
- The person or company who actually received the funds. A recipient may have to return money that was never rightly theirs. Tracing rules may let you follow funds into other accounts or assets.
- People who knowingly assisted. A person who knowingly helped in a breach of trust or who knowingly received trust funds may be liable.
- Directors or insiders of a company used in the scheme. The corporate structure generally does not shield an individual from liability for their own fraud.
- Professionals or institutions. This is a difficult area. A bank’s duties are mainly set by its account agreement, and a bank generally has no duty to protect you from an authorized payment just because it was unwise. These claims depend heavily on the facts.
Reimbursement sometimes comes through other channels. Your bank’s unauthorized transaction policy may help where you did not authorize a payment. Credit card chargebacks have their own time limits. An insurance policy, especially a commercial crime rider for a business, may provide cover, and it will have its own notice deadlines.
Court Tools for Tracing and Freezing
Ordinary litigation is often too slow for fraud. Courts have developed special orders that can help, typically on an urgent basis.
Norwich orders. Named after a British decision, this kind of order compels an innocent third party, usually a bank or telecom or internet provider, to disclose information that identifies a wrongdoer or shows where money went. Ontario courts have granted them in fraud matters, but they are treated as an extraordinary remedy. The applicant must usually show a legitimate or bona fide claim, that the third party is the practical source of the information, and that the interests of justice favour disclosure. You typically must also pay the third party’s reasonable costs of complying.
Mareva injunctions. This order freezes a defendant’s assets before judgment. The usual test requires a strong prima facie case, evidence of assets within reach, and a real risk that they will be removed or dissipated. In fraud cases, courts may be prepared to infer that risk from the circumstances, though it is not automatic. The order may be sought without notice, in which case the moving party has a strict duty of full and frank disclosure. It usually also requires an undertaking to pay damages if the order turns out to have been wrongly granted.
Certificate of pending litigation. If you can trace your money into a piece of land, and you claim an interest in it, a court may allow this notice to be registered on title. That can prevent a sale from proceeding quietly.
These tools can be costly, because a lawyer must assemble strong evidence fast. They make the most sense where the loss is significant and there is a good chance of finding funds. Our page on civil motions and applications describes this kind of court step in general terms.
Deadlines, and Defendants You Cannot Find
The basic limitation period under the Limitations Act, 2002 is two years from discovery, generally when you knew or reasonably ought to have known of the loss, that it was caused by the other party’s act or omission, and that a court proceeding was an appropriate remedy. Fraud often takes time to come to light, and the Act can protect you there, since time doesn’t run until the claim is discoverable. But a defendant will argue that warning signs should have prompted you to look sooner.
An ultimate 15-year limit also applies in most cases, subject to narrow exceptions, including a period when the defendant wilfully concealed the claim or wilfully misled the claimant. Do not lean on any of this. Start as early as you sensibly can, not least because money moves.
Many people assume that a claim cannot proceed against an unknown person. There are routes around this, although they have limits. It may be possible to name a “John Doe” defendant while you investigate, and to bring a motion for substituted service where the defendant is avoiding service or cannot readily be found. This may mean serving by email or through a social media account the fraudster is known to use, if a court is satisfied it will likely reach them. Defendants outside Ontario raise extra rules on service and jurisdiction, and if they are overseas, enforcing a judgment there is a separate undertaking.
If the defendant is served and does not respond, you may be able to get default judgment. It can be obtained relatively quickly, but a judgment against someone with no assets is only a piece of paper.
What Winning May Be Worth
A successful plaintiff may receive compensation for the loss, plus interest and a contribution toward legal costs. In serious cases, a court may award punitive damages, although these are exceptional. Beyond the amount, a fraud judgment can have one notable advantage. Under section 178(1)(e) of the Bankruptcy and Insolvency Act, a debt or liability resulting from obtaining property by false pretences or fraudulent misrepresentation can survive an order of discharge from bankruptcy. The creditor bears the burden of showing that the exception applies, so the wording of your judgment and the findings behind it can matter. If you settle, ask your lawyer about that too. The Supreme Court examined this provision in Poonian v. British Columbia (Securities Commission), 2024 SCC 28.
A judgment can then be enforced by garnishing wages and bank accounts, by filing a writ against land, and by examining the debtor about their assets.
Choosing the Right Court
Claims up to $50,000 belong in Small Claims Court, which has lower fees and a simpler process. It is a good fit where the defendant is known and the loss modest. But that court cannot grant injunctions, Norwich orders or other equitable relief. If you need a freeze on assets or to compel disclosure from a bank, you must go to the Superior Court of Justice. In Brampton, both are located at 7755 Hurontario Street.
Before filing anything, ask a blunt question: how much will this cost compared with the likely recovery? A hypothetical $12,000 crypto loss to an anonymous overseas account may not justify a tracing exercise costing many times as much. A $400,000 loss with funds traced to a local numbered company and a home in Peel Region may be a very different calculation. A reputable lawyer should discuss that openly with you, and no one can promise recovery.
Small businesses in Brampton’s trucking, wholesale and construction sectors can be hit by payment redirection scams, where a fake email tells a bookkeeper that a supplier’s banking details have changed. If this happens to you, act as an individual would, but also notify your insurer right away, review your commercial crime coverage, and preserve the email system’s logs. Your internal IT provider might be able to determine how the account was compromised. Think about whether your supplier remains owed the money, which depends on the contract and the facts, and don’t assume the loss falls on them or on you until you have had proper advice.
Where to Go From Here
A short, dated timeline of what happened, along with your bank records and messages, will help any lawyer assess the claim quickly. If you are not sure whether the facts amount to fraud or to a contract dispute that went badly, it is worth asking before you make accusations in writing. Our civil litigation page explains the kinds of claims we deal with, and you can contact our Brampton office to book a review.
Losing money to deception can be deeply unsettling. The law cannot undo the experience, and it can’t always restore the money. What it can give you is a set of practical questions with answers: who received the funds, where they went, and what steps make financial sense from here.