Eric Griffith, owner of Alta Bistro and Alpha Cafe, in Whistler, B.C., on Feb. 12.Alia Youssef/The Globe and Mail
An alert popped up when restaurateur Eric Griffith opened his digital wallet on Everyday Payments, the platform he used to distribute gratuities to his staff, late last month.
It informed him of a withdrawal from his bank account: three times the amount he had authorized the payment provider to take, Mr. Griffith alleges. Between Alta Bistro and Alpha Cafe, his two businesses in Whistler, B.C., Mr. Griffith was out roughly $14,000 – just as rent was coming due.
“I was like, what? I didn’t ask for that. … I don’t want that much money in that account,” he said.
Then he noticed something even more troubling. Transaction history indicated that before the triple withdrawal, the tip-pooling service, which is jointly owned by Toronto-based XTM Inc. and Edmonton-based Everyday People Financial Corp., had allegedly taken all of the cash – about $4,500 – that had been sitting in Mr. Griffith’s digital wallets.
A similar situation was playing out at restaurants and other hospitality businesses across the country, according to industry associations.
Ian Tostenson, president and chief executive officer of the British Columbia Restaurant and Foodservices Association, said he’s calculated at least $10-million in losses after speaking with some 40 or 50 restaurants. Most are in British Columbia but he’s received complaints from businesses in Alberta as well.
Former exec of fintech linked to missing restaurant tips alleges CEO was ‘misleading users’
One large restaurant group is out about $1-million; another is missing $300,000, according to Mr. Tostenson. At least 10 craft brewers in B.C. have also been affected, he said.
Tony Elenis, president and CEO of the Ontario Restaurant Hotel and Motel Association, said he has spoken with a handful of affected restaurants, including a large chain. And the Restaurant Association of Nova Scotia has advised its members of a growing number of reports of “account discrepancies” and “delayed access to funds” from restaurant operators using the platform.
The situation has sparked investigations by the B.C. RCMP as well as the Bank of Canada, which began supervising payment service providers in September, 2025. On Tuesday, the central bank issued a temporary order barring XTM from performing any payment activities, saying it has “serious concerns” that the fintech “failed to safeguard client funds in its possession.”
XTM is one of more than 800 payment service providers registered with the Bank of Canada, which is tasked with ensuring that the providers manage operational risks and safeguard client funds. Another 928 companies have applied for registration, giving the central bank oversight of more than 1,700 PSPs.
Michael Liquornik, president of Fin-Serv Advisors Inc., questions whether XTM’s registration should have been approved, given the issues disclosed in its financial statements.
“I would hope that this is a wake-up call,” said Mr. Liquornik, whose firm advises payment platforms, fintechs and financial institutions.
“How many others like this are out there?”
Mr. Griffith says his bank was able to reverse the withdrawal from his account before the money had cleared, but he has lost faith in Everyday's platform.Alia Youssef/The Globe and Mail
Platforms such as Everyday Payments are designed to make it quicker and easier for restaurants to pay gratuities to their staff.
The Canada Revenue Agency requires employers to withhold source deductions and pay premiums on what it deems controlled tips, but not on direct tips. Gratuities are considered to be controlled if they are collected and distributed by the employer, versus those that are given directly to the employee, such as cash left on the table at the end of a meal.
The shift to credit-card payments has made matters more complicated. Enter “gratuity facilitators” – the industry term for Everyday Payments and its competitors.
“Groups like XTM have come in and created a model where the employer does not touch the tips,” Mr. Elenis said.
Employers prefund their digital wallets by sending money to the payment platform, where it is to be held in a custodial account as restricted cash. Employees can then cash out the tips they’ve earned by transferring money from their employer’s wallet onto a prepaid card.
However, XTM’s auditor, Abu-Farah Professional Corp., noted in a May, 2025, report filed with its client’s public financial statements that the company had used “restricted cash funds” for “its operating and program management, resulting in a potential liability to the Company.”
The Mississauga-based auditor also noted that XTM had incurred a net loss in 2024 and that “a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern.”
And in its financial statements for the three-month period ended Sept. 30, 2025, XTM reported a “trust deficit” of roughly $18.75-million, up from $13.96-million at the end of 2024.
The fintech has also failed to pay more than US$200,000 owed to a Kansas staffing company after an August, 2025, U.S. court judgment, The Globe and Mail previously reported.
That company, Kansys Staffing Group, had several contractors doing software development for Denver-based payment company QRails Inc. before the latter was acquired by XTM in 2023, according to Ashley Ogren, who co-owns the Kansas firm with her husband. Ms. Ogren said XTM stopped paying her invoices when it took over.
Marilyn Schaffer, XTM’s chief executive, told Ms. Ogren that she was unable to make payroll on Nov. 28 last year and that XTM is “so broke we use ChatGPT for legal,” according to e-mails provided to The Globe by Ms. Ogren.
XTM is also facing allegations from a former executive, who claimed that the company fired him after he complained to Ms. Schaffer that she was misleading investors and putting users’ money at risk.
Jason Giagrande was head of business strategy for the United States at XTM in 2022, when he started raising concerns about what he believed were “illegal activities,” according to a lawsuit filed in the U.S. District Court for the Southern District of New York in September, 2024.
Mr. Giagrande alleges that Ms. Schaffer inflated the company’s revenue in investor presentations, engaged in a form of market manipulation known as wash trading and failed to properly insure client funds, The Globe previously reported. He cautioned Ms. Schaffer that her non-compliance would “catch up” to the company and become a “major issue,” Mr. Giagrande alleges.
XTM has denied all of Mr. Giagrande’s allegations, calling him a “disgruntled consultant” and stating in its response and counterclaim that he “milked tens of thousands of dollars from XTM while failing to perform his obligations.”
None of the allegations have been proven in court.
In Europe, payment providers have been regulated since 2009. Canada’s Retail Payment Activities Act came into effect last fall, following recommendations made by the Department of Finance in 2017.
“Canada is well behind some other markets in terms of its regulation of payments,” Mr. Liquornik said.
The situation involving XTM is the first time that the Bank of Canada’s new supervisory powers over PSPs are being put to the test.
In its temporary order, which lasts for 30 days and can be extended, the bank states that XTM’s public financial statements confirm that it failed to safeguard its users’ funds, resulting in a significant shortfall.
“The Managing Director is concerned that a shortfall of this magnitude has caused harm to end users,” the order states.
In response to questions about XTM’s registration, Akim Thibouthot, a spokesperson for the bank, said in a statement that it will register PSPs that “are in scope with” the Retail Payment Activities Act and undergo a national-security review.
“This is unlike a licensing regime, where a firm must demonstrate its compliance before it can receive a license and begin operations,” he wrote.
The case is a rare instance where the public has access to a payment company’s financials, according to Mr. Liquornik, who said that most firms in this space are not publicly traded.
“Do I think that there’s a large percentage of PSPs that are now registered that have dipped into client funds? No,” he said. “Do I think it’s zero, apart from this one? No.”
Last October, XTM announced it had entered into an agreement whereby Everyday People Financial would take over managing and administering the gratuity platform.
A spokesperson for Everyday People Financial previously told The Globe that wallet balances on the platform were adjusted on Jan. 28 to reflect the amount of actual cash available in the settlement accounts held in XTM’s name.
“This adjustment aligned displayed wallet balances with the funds then available in those accounts based on reconciliation data,” the company said.
Adam Atlas, a lawyer representing XTM, said in a statement to The Globe that the relationship between the company and Everyday People Financial is “complicated.” However, he wrote that XTM “did not itself initiate withdrawals from merchant bank accounts that were not authorized by the merchants themselves.”
There are more than 800 payment service providers currently registered with the Bank of Canada.STEFANI REYNOLDS
The missing tip money compounds the challenges facing a struggling industry, Mr. Elenis said.
After emerging from a series of lockdowns intended to curb the spread of COVID-19, today restaurants are weathering further headwinds: high levels of inflation on food, rising labour costs and economic pressures that have prompted many consumers to cut back their spending. Nearly half of the country’s restaurants are either losing money or just breaking even, according to a recent report from Restaurants Canada.
“In these times, it is hard to see something like what’s happened with XTM,” Mr. Elenis said.
Some restaurant owners had to borrow money from their families or their banks to pay their employees the gratuities they were owed, Mr. Tostenson said.
Going forward, business owners will need to conduct more due diligence when dealing with third-party providers that handle their money, he added.
“When you think about it now, we were – I was – being a little bit naive. … We’re putting money into an account that we’re not in control of. The first question you have to ask yourself is, what’s securing that money?" he said.
Some of XTM’s customers have gotten their money back, but Mr. Tostenson said they’re few and far between.
Mr. Griffith is one of them. His bank was able to reverse the withdrawal from his account before the money had cleared. But, having lost faith in the platform, he’s started the onboarding process at one of Everyday’s competitors, another Toronto-based company called Atlas.
“I need to get moving with my business,” he said. “This took up so much of my time in the last two weeks.”