I've read on Interac website these are supposed to be non-reversible, which is why they are good for online sales. I guess not.
I'm interested to know the outcome of this as well.
The marketing language they use is somewhat deceptive and they are intentionally vague thinking obscurity provides security.
Unlike a credit card you can't dispute a charge for any reason except that you didn't make it. This there is no chargeback because you didn't receive the product, the merchant lied, the product arrived broken, etc.
A thief however can still dispute they never made the charge. "
It wasn't me, I have no idea who this Bitcoin hacker guy is, or how he stole my money but I never made these transfers. Please Mr. Bank Customer support person they stole all my money I can't pay the rent unless I get this back". It appears that is what happened to the OP. It is also possible although unlikely the person on localbitcoins isn't the account holder and he just transfered funds using an actual stolen account (which is now being disputed by the real accountholder).
Summary
1) Dispute when there is a problem with the sale - NOT ALLOWED
2) Dispute when funds are sent by a hacker from a compromised bank account - ALLOWED.
3) Dispute when real account holder pretends #2 above happened - ALLOWED