Photo: CTV News

An ongoing fraud and identity theft operation targeting taxi riders in the Greater Toronto Area has already cost hundreds of people millions of dollars, city police said Thursday as they announced a handful of arrests in the case.

Det. Const. Kristin Thomas said the 262 charges laid against four men, a woman and a teenage boy mark only the start of resolving the alleged scam, which she said has been defrauding customers for more than a year.

"We're in the millions of a loss when you put them all together," Thomas said of the sums of money involved. Police received reports of the alleged frauds throughout 2018, but a few months passed before a pattern began to emerge, she said.

Thomas said the alleged frauds involve customers riding in cabs belonging to several of the city's licensed taxi companies rather than travelling with ride-hailing services such as Uber or Lyft.

Customers report trying to pay their fares by inserting their bank or credit cards into a point-of-sale machine that records their PIN codes and displays an error message suggesting the transaction went wrong, Thomas said.

She said drivers allegedly take the machine back on the pretence of trying to fix the error, at which point they allegedly swap the customer's card for another one issued by the same financial institution. The customer leaves the cab believing the fare has been successfully paid and not noticing the card swap, she said.

Thomas said the drivers then use the stolen bank card and surreptitiously obtained PIN code to access customer accounts, alleging they sometimes do so directly or share the information with accomplices.

Thomas said police have made six arrests in the case so far between mid November and earlier this week.

Four men in their 20s, including two 22-year-old brothers, a 48-year-old woman and a 16-year-old boy are facing a total of 262 charges between them, she said. Charges include multiple counts of fraud over $5,000, identity theft, unauthorized use of debit or credit cards and possession of property obtained by crime.