In January 2026, a civil suit filed in BC Supreme Court alleged that three employees at a single Denny's in Kamloops had stolen more than $500,000 from the restaurant's electronic tip system over two years.
The story of how it happened is almost painfully simple.
The scheme
The Denny's location used a digital platform called Tips Today to collect and distribute credit and debit card tips. Employees got their share loaded onto prepaid cards. According to court documents filed by Northland Properties (the company behind Denny's in Canada), a former manager had been quietly pulling money out of the system for roughly two years, racking up nearly $495,000 before he resigned in November 2025.
On his way out, he reportedly asked a server for her verification codes, telling her he needed them for routine tip repayments. She handed them over.
But his method didn't leave with him. According to the claim, he'd already shown a supervisor how the whole thing worked. That supervisor recruited another employee, and together they moved another $11,000 before the transfers were finally flagged.
Kamloops RCMP confirmed they're actively investigating. All three defendants have denied wrongdoing, and nothing has been proven in court. But the case was just the start.
Then the platform fell apart
Weeks later, restaurants across B.C. started reporting something scarier: tips were vanishing from their accounts on a platform called Everyday Payments, a subsidiary of Toronto-based XTM Inc. The same company behind the Tips Today platform at that Kamloops Denny's.
It spread fast. Restaurants in Whistler, Squamish, Vancouver, and Prince George all reported missing funds. The BC Restaurant & Foodservices Association estimated tens of millions had disappeared. In one Vancouver case, nearly $1 million was drained from a single restaurant group's account. The association's CEO said he got panicked calls from 50 restaurants in 48 hours.
The Bank of Canada ordered XTM to stop all payment activities, citing serious concerns about safeguarding client funds. XTM's own filings showed an accumulated deficit of $71 million and a trust shortfall of roughly $18.75 million. They'd been using client money to keep the lights on.
By late February, XTM was in insolvency proceedings. A court-appointed monitor now oversees whatever's left. Many restaurant owners still haven't been made whole. Some had to borrow from family just to pay their staff the tips they were owed.
Why this should worry every restaurant owner
It's tempting to write these off as freak incidents. But they expose the same blind spot: restaurants are handing off one of their most sensitive obligations to systems and platforms they never actually verify.
Under BC's Employment Standards Act, tips belong to employees. Full stop. Employers can't withhold them, can't skim from them, can't redirect them. If you collect and redistribute through a tip pool, there are strict rules about who participates. And if your platform fails, you're still the one on the hook to make your staff whole.
The problem isn't that restaurants adopted digital tip platforms. Those platforms genuinely save time. The problem is that "automatic" became "unmonitored." And in both cases, employee fraud and platform failure, the lack of independent oversight is what let the damage pile up.
Questions worth asking this week
When did you last audit your tip system? Not glance at it. Actually audit it. The Kamloops scheme ran for two years. An employment lawyer quoted in the coverage said he was surprised a large chain didn't have anomaly detection in place.
Could a former employee still access your tip platform? In the Kamloops case, the alleged scheme continued after the manager resigned. Access codes from a current employee kept the door open.
Where does your tip money actually sit? A lot of owners didn't realize their funds on Everyday Payments were sitting in accounts they couldn't control or verify. When those accounts got drained, their only option was a lawsuit. As one industry leader put it: "We were putting money into an account that we're not in control of."
If your platform went down tomorrow, could you still pay tips by Friday? For many restaurants caught in the Everyday Payments mess, the answer was no.
The point
Good tip systems don't just save you time. They keep money visible, flag things that look wrong, and make sure the people who earned those tips actually get them. The last three months have shown what happens when that visibility doesn't exist.
Take 30 minutes this week and look at your setup with fresh eyes. Not because your people aren't trustworthy. Because good systems protect good people too.
All allegations referenced here are based on civil claims filed in BC Supreme Court and reporting from CBC News, Global News, The Globe and Mail, and other outlets. None of the allegations in the Kamloops case have been proven in court. The defendants have denied wrongdoing. The XTM/Everyday Payments situation is under active investigation by the Bank of Canada and RCMP.
Half a Million Dollars Stolen Through a Tip System. Nobody Noticed for Two Years.