Justin Smith has been hit with a one-two punch of bad luck. First, the Toronto man was duped by a job scam that made off with $3,000. Then his longtime bank, Tangerine, helped itself to money Smith had in his tax-free savings account to recoup what it had lost in the scam."You keep your money in the bank because you think it's safe," he said. "And they treat the money like it's theirs, and they just move it around to protect themselves. That's not fair."Tangerine is an online subsidiary of Scotiabank that offers no-fee savings and chequing accounts.Here's how the double episode of misfortune unfolded: Smith, who works as a delivery person, had applied to work from home as a data entry clerk for the grocery chain Sobeys. He was offered the job, and was excited to receive an employment contract along with a cheque from his new employer for $3,495 to purchase a laptop, phone system, headphones and various other office equipment."It all looked totally authentic and real," he said. Smith had checked out the names of the people who handled his hiring, and reviewed their profiles on LinkedIn to confirm they worked at Sobeys. So when he received an invoice from a firm called Tech Insight Services for the office equipment, and was instructed by the Sobeys hiring manager to make a $3,000 payment right away, he promptly sent an e-transfer."I only had $800 or so in my chequing account at the time, but after depositing the Sobeys cheque, I had over $4,000," he said. What Smith didn't know was that the entire process was a sophisticated scam. The website where he'd applied, the supposed hiring managers, the cheque — all were fakes. His job application hadn't been sent to Sobeys at all. He had fallen into a snare set to swindle eager job seekers. The cheque even fooled Tangerine; the bank instantly deposited it to Smith's account.Alarm bells didn't start ringing until the next day, when Smith's supposedly new employer told him he should send another $3,500 for a new desk. "At this point, I became suspicious because no one spends that kind of money on a desk," he said. "I called up Tangerine and I said 'OK, I deposited a cheque yesterday, you guys let me send the money. I'm concerned that this cheque is going to bounce.'" WATCH | Bank raids fraud victim's account:Deep in the fine printSmith learned quickly that the scammers had already accepted his e-transfer, and a Tangerine representative said that meant it was too late to cancel it. "He asked 'Do you have money in your other accounts to make up for that?' and I told him I didn't want the bank to take money from those other accounts."Because his tax-fee savings account was registered with the federal government, Smith believed the money in it was untouchable. He was wrong. Deep in the fine print of the agreements many customers receive when they open a bank account is a clause known as the "right of setoff," also sometimes referred to as the right of "offset." It states that the bank has the legal power to seize funds from a debtor or guarantor of a debt. Although that right may vary depending on the product or plan, it's in most agreements; RRSPs and registered retirement income funds are typically exempt. This means if the bank accepts a cheque or another type of deposit that doesn't go through as expected, and a customer withdraws or transfers the funds, the bank has effectively made a bad loan. It then has the right to access money in other accounts it holds for that customer, in order to recover its loss. There is no need to get authorization, or even alert the customer beforehand.Shortly after the fake Sobeys cheque bounced, Tangerine took just over $3,000 from Smith's account. Smith sent two letters of complaint to the bank, asking to be compensated, but was told each time that the bank is not liable for his loss, and that he should report the scam to police. Job scams have become common during the pandemic, according to the Canadian Anti-Fraud Centre. CBC News reported on a similar scam that involved Sobeys in June. In that case, the victim's bank, the Bank of Montreal, spotted the fraud and didn't send the payment.Sobeys is aware of the fake websites bearing its name, and said it is monitoring the web 24/7 to try to have them shut down. In a statement the company said anyone "looking to join the team or confirm the legitimacy of a job posting," should check jobs.sobeyscareers.com.Some good newsAfter being contacted by CBC's Go Public team, Tangerine said it will refund the $3,000 to Smith, and also pay $250 for a credit monitoring service for him.In an email sent to Smith that was shared with CBC News, the head of the bank's client response group, Emery Sziraky, said: "We have conducted a comprehensive review of your recent experience with Tangerine and we deeply regret that we did not meet your expectations."The bank also emailed a statement to Go Public, saying it was "pleased" to have resolved the matter to Smith's satisfaction. The statement included a warning about fraud, and said Tangerine "work[s] closely with the Canadian Anti-Fraud Centre, the Canadian Bankers Association, law enforcement, and counterparts at other financial institutions," to ensure clients are protected.But Doug Hoyes, an insolvency trustee in Kitchener, Ont., said all Canadians should be aware how common it is for banks to access customer accounts to recover their own losses. "It blindsides people," Hoyes said. "I've seen it happen thousands of times."Hoyes said banks typically put a hold on large cheques deposited to the accounts of new customers; they are unable to access the funds until the cheque clears. But for longstanding, trusted customers, banks will often extend a form of credit and make funds available immediately. Hoyes said that most customers appreciate the ability to access deposits right away. "In most cases what the bank did is very helpful; 'Hey, you put the money in, you can use it.' But in this case, it backfired," he said. A five- or even three-day hold on the cheque Smith had received would have stymied the scammers, but he was a longtime Tangerine client. He opened an account in the late '90s when the bank was still called ING Direct, prior to a rebranding. So he was given instant access to funds.Hoyes added that he often tells his own clients, all of whom have money problems, to set up bank accounts at two different financial institutions. "It is wise to have your assets at a different bank than your debts, if it's possible," he said. That way if a payment goes wrong in any way, the bank isn't able to dip into other accounts on file, he explained.As for Smith, he's still eager to find a new job, and is grateful that Tangerine decided to do "the right thing.""I don't want to make myself out to be a victim here," Smith said. "I'm just trying to help other people not become a victim of these scammers or, quite frankly, become the victim of their bank."