Const. Ian MacDonald says the woman's embarrassed family called police after the picture was released Thursday to say she could not have requested a replacement debit card using someone else's name and ID.
MacDonald says the family was adamant that an error had been made and that their relative is a regular customer at the bank where the apparent fraud took place on March 13.
He says TD Canada Trust has now acknowledged that a teller made a "keying error" by cancelling a valid card belonging to one customer and issuing it to the woman who was then accused of fraud.
MacDonald says several people called police to identify the woman, indicating such behaviour seemed out of character but that perhaps her life had taken a turn.
Jeff Meerman, a spokesman for TD-Bank Group, says they regret the mistake and have every intention of apologizing to the customer.
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