Canada Restaurant Tips Disruption: Millions Missing, Bank of Canada Investigates

Canada restaurant tips are at the center of a growing payment crisis after restaurants across the country reported missing funds from digital tip platforms. Industry leaders estimate losses could reach $10 million, prompting investigations by police and the Bank of Canada.

The issue came to light when Eric Griffith, owner of Alta Bistro and Alpha Cafe in Whistler, B.C., noticed irregular withdrawals from his payment platform, Everyday Payments. His bank account was charged nearly three times the authorized amount, resulting in a loss of approximately $14,000 at a critical time when rent payments were due. Transaction records indicated that before the triple withdrawal occurred, the service provider — jointly owned by Toronto-based XTM Inc. and Edmonton’s Everyday People Financial Corp. — had allegedly already removed the remaining balance from his digital wallet, approximately $4,500.

Industry associations say this is not an isolated case. According to the BC Restaurant and Foodservices Association, after speaking with roughly 40 to 50 operators, estimated industry-wide losses may total at least $10 million. Most affected businesses are in British Columbia, though complaints have also emerged in Alberta.

Reported impacts include:

• One large restaurant group losing about $1 million
• Another operator reporting losses of roughly $300,000
• At least 10 craft breweries in B.C. affected
• Ontario’s hospitality association confirming multiple impacted restaurants, including a major chain
• Nova Scotia’s restaurant association issuing warnings about account discrepancies and delayed deposits

The situation has drawn the attention of the RCMP and the Bank of Canada. Since September 2025, the central bank has overseen payment service providers (PSPs). This week, it issued a temporary order prohibiting XTM from conducting payment activities, citing serious concerns over its ability to safeguard client funds. XTM is one of more than 800 registered PSPs, while the Bank of Canada supervises over 1,700 payment firms nationwide.

Digital tip platforms such as Everyday Payments were designed to accelerate tip distribution to employees. Under Canada Revenue Agency rules, employer-controlled tips require payroll deductions, while direct cash tips do not. These platforms typically operate by having employers preload funds into a digital wallet, where they are held as restricted cash before employees withdraw funds through prepaid cards.

Audit warnings had surfaced earlier. In May 2025, XTM’s auditor reported that restricted cash had been used for operational purposes, raising concerns about potential liabilities. The company reported a net loss in 2024 and disclosed material uncertainty about its ability to continue as a going concern. As of September 2025, its reported trust deficit stood at approximately $18.75 million, up from $13.96 million at the end of 2024.

The company also faces disputes, including:

• A U.S. staffing firm alleging over $200,000 in unpaid amounts (with a court ruling issued)
• A former executive filing a lawsuit alleging investor misrepresentation and misconduct

XTM has denied certain allegations, and claims remain before the courts.

For an industry already struggling with post-pandemic recovery, inflation, rising labor costs and weak consumer spending, the loss of tip funds represents another blow. Restaurants Canada reports that nearly half of establishments nationwide are either operating at a loss or barely breaking even. Some owners have reportedly borrowed from family members or banks to cover employee tips while investigations continue.

Although a few merchants have recovered funds — Griffith’s bank reversed the charge before final settlement — the disruption has eroded confidence. As he put it, the past two weeks have consumed significant time and energy while he continues trying to run his business.