A new report from Toronto's city hall is raising significant concerns regarding instances of alleged fraud and waste that have resulted in substantial financial losses for the municipality. These findings emerge from a report authored by auditor general Tara Anderson, focusing on the City of Toronto’s fraud and waste hotline.
In 2025, the hotline received nearly 700 complaints, amounting to over 1,100 separate allegations. This hotline is confidential and provides a platform for both City of Toronto employees and members of the public to report suspected fraud, conflicts of interest, and misuse of city resources.
Among the most striking cases identified in the report was related to electricity contracts involving 14 city properties. Investigators found that accounts were switched from Toronto Hydro to third-party retailers without appropriate authorization, utilizing credentials belonging to a retired employee. The auditor general's office assessed that if this fraudulent activity had not been detected in time, the city could have faced financial losses of approximately $2.5 million.
Councillor Paula Fletcher commented on the importance of the hotline, stating, “These investigations happen, and these people have been caught, so their behavior is over, and for many of them, their career is over. I’m just happy we have this fraud and waste hotline that people can say ‘somebody is cheating the system.'”
In addition to the larger case, other instances of misconduct were detailed in the report, including a situation where an employee improperly collected three weeks of paid sick leave while concurrently working a second job, costing taxpayers around $3,000. Additionally, over 20 packages containing electronic devices were reported missing from the city’s mailrooms, with at least one employee found to have stolen items worth approximately $2,300.
Fletcher emphasized that the hotline serves as a crucial safeguard for the city’s financial integrity. She stated, “In a division, you can kind of paper over; you’re just doing a regular audit, do the numbers add up? But somebody that phones in and says the numbers might look OK on paper, but behind that, you’ve got something else going on.”
The report noted that confirmed cases of fraud and waste have resulted in actual losses of $6.3 million over the past five years. However, early detection strategies have prevented about $4 million in potential additional losses, and more than $700,000 has been successfully recovered.
Councillor Stephen Holyday pointed out the effective financial returns of investing in the auditor general’s office, saying, “For every dollar that we put into the auditor general’s office, she brings back $9 in savings to the City. That amounts to hundreds of millions of dollars over the year and a very significant change to the city’s processes and procedures.”
While the report highlights consistent financial returns from these fraud investigations, it also raises the pressing issue of identifying recurring patterns and addressing gaps before they lead to systematic issues. Holyday reiterated this sentiment, explaining, “There are always gaps to be found and improvements to be made, and one of the things we heard today at the audit committee was about recurring themes and concerns from the auditor general. This is only but one report and one meeting, but over the years, we can certainly see patterns.”
