A Calgary man faces charges after Canada Border Services Agency officers intercepted a package containing 3,300 fake Calgary Transit U-Pass stickers that, if distributed, could have resulted in a loss of more than $1.3 million in revenue.

The investigation was started in June 2017 when Calgary Transit peace officers notified Calgary police that they were seeing an increasing number of high quality, fake U-Pass stickers that had been bought online.

"[Officers] started to notice discrepancies, repeating serial numbers," said Supt. Brian Whitelaw, head of public safety with Calgary Transit, noting at least 22 people were found to be using fake passes.

The U-Pass is available only to students at five post-secondary schools — SAIT, ACAD, the University of Calgary, MRU and St. Mary's University — and offers a reduced fare, based on a four-month semester.

Members of the Calgary Police Service's online stolen property team were able to find listings for fraudulent U-Pass stickers and an investigation was launched.

Some of the people found with a counterfeit pass were not students and thus weren't eligible to have one, said Whitelaw. They were given tickets for fare evasion.

"I think every one of them learned along the way their interest in a lower fare ultimately cost them more money," he said.

"There's an element of willful blindness. So if you're buying from a secondary or online site, it is really a buyer-beware situation and ... if you find things that are offered for prices lower than what their face value is, you really have to ask a lot of questions."

Forged Calgary Transit U-Pass stickers seized by police. (Calgary Police Service)

Police said the person responsible used a number of means to conceal their identity, such as using fake names, changing their phone number and only sporadically posting ads online.

In January, border officers intercepted a package mailed from China containing 3,300 professionally printed U-Pass stickers. Had those stickers been distributed, police allege they could have resulted in a loss of $1.3 million in revenue for Calgary Transit.

Search warrants were executed and police say a significant amount of digital evidence was obtained.

Police allege that between May 2015 and January 2018, the perpetrator sold about $34,000 worth of fake U-Pass stickers.

David Philip Smerd, 31, of Calgary, is charged with one count each of making forged documents, fraud over $5,000 and uttering forged documents.

He is scheduled to appear in court next on Sept. 10.