A new report out of Toronto city hall is raising concerns after several instances of alleged fraud and prevented costs to the municipality, totalling millions of dollars, were discovered.

The findings were contained in a report by auditor general Tara Anderson’s office on the City of Toronto’s fraud and waste hotline.

The hotline received nearly 700 complaints in 2025, totalling more than 1,100 separate allegations. The confidential hotline allows City of Toronto employees and members of the public to report suspected fraud, conflict of interest, and/or misuse of resources. 

One of the most significant cases uncovered last year involved electricity contracts for 14 city properties. The report said investigators found the accounts had been switched from Toronto Hydro to third-party retailers without proper authorization, using credentials tied to a retired employee.

The auditor general’s office estimated the city could have lost about $2.5 million if the issue hadn’t been caught on time.

“These investigations happen, and these people have been caught, so their behaviour is over, and for many of them, their career is over,” Coun. Paula Fletcher told CityNews.

“I’m just happy we have this fraud and waste hotline that people can say ‘somebody is cheating the system.’”

Other cases were smaller, but still costly. In one instance, the report said an employee collected three weeks of paid sick leave while working a second job. It cost taxpayers around $3,000.

In a second instance, more than 20 packages containing electronic devices went missing from City of Toronto mailrooms. At least one employee was found to have stolen items worth about $2,300.

Fletcher said the hotline is a critical safeguard.

“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 in behind that, you’ve got something else going on.”

According to the report, confirmed fraud and waste cases have resulted in $6.3 million in actual losses over the past five years. The report added that early detection helped prevent roughly $4 million in additional potential losses, and more than $700,000 has been recovered. 

“One of the things we heard today at the audit committee was that 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,” Coun. Stephen Holyday said.

While the report highlights consistent financial returns, the bigger concern is identifying patterns and closing gaps before the patterns get repeated. 

“There are always gaps to be found and improvements to be made, and one of the other 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,” Holyday said.