Quebec farmers lose $27,000 after fraud scheme

Quebec farmers Alana Cosgrove and Matt Penney of Pengrove Farms in Hudson have fallen victim to a fraud that cost them $27,000. The couple, who run a busy farm operation, received a wholesale meat order from someone claiming to represent a catering company. The initial payment for an order worth about $17,000 was approved through their point-of-sale system, Square, leading them to fulfill the order.

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We asked them to come in person to pay it and they never showed up again so we turned it over for product in our store, but we had already sent out $27,000 worth of product in those two weeks.

Suspicion arose when the same customer attempted to place another large order the following week, but only part of the payment went through. When asked to pay in person, the customer never returned. The farmers stated that they had already released $27,000 worth of product over two weeks before realizing the transactions were fraudulent.

Nearly six weeks later, Square notified the couple that the transactions were fraudulent and held them financially responsible for the full amount. "Square started seizing all of our daily sales, and so anything that would come through Square in our store would be seized automatically to pay back that debt that Square deems is our responsibility," Cosgrove explained. This led them to stop accepting credit and debit cards and switch to a cash-only policy in their store.

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Square started seizing all of our daily sales, and so anything that would come through Square in our store would be seized automatically to pay back that debt that Square deems is our responsibility.

The couple has since reached an agreement with Square to repay the $27,000 over the next 12 months. While a GoFundMe has raised over $13,000 to help offset the loss, Cosgrove and Penney hope their experience will prompt stronger protections for small businesses and encourage greater vigilance. They are advocating for policy changes that better protect businesses, rather than solely banks.

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We’re hoping that the more people get eyes on this story that more pressure can be put at a policy level to maybe start changing some of these policies to start protecting businesses more than protecting only banks.