Toronto Auditor General Uncovers Extensive Fraud and Theft in 2025 City Hall Report
In a startling revelation, Toronto's auditor general, Tara Anderson, has exposed a series of fraudulent activities and thefts at City Hall in 2025, with cases ranging from petty theft to million-dollar overbilling schemes. The report, presented to the city's audit committee, details numerous incidents reported through the fraud and waste hotline, highlighting systemic issues in municipal oversight.
Missing Electronics and Employee Misconduct
The investigation found that over 20 packages of electronics, valued at approximately $21,100, vanished from City Hall's mailroom over a two-year period. Three of these missing parcels were linked to a former employee, who is no longer with the organization. Additionally, the report cited cases where employees sold city-issued personal protective equipment and clothing online, costing taxpayers $350 and $125 respectively. One employee received a 10-day suspension, while another was fired, though the latter contested the decision.
Large-Scale Fraud and Financial Mismanagement
On a more alarming scale, the auditor uncovered intentional overbilling of at least $1.1 million by a vendor with multiple city contracts. A forensic audit confirmed the fraud, and the vendor has agreed to repay the amount. The matter has been reported to the Toronto Police Service. In another instance, a former employee allegedly spent $53,600 on gift cards before leaving the city, with the funds later recovered. The affected unit is now hiring a chief financial officer to enhance oversight.
Employee Abuse of Time and Benefits
The report also detailed cases of employees misusing work hours and benefits. One staffer was caught moonlighting for their own company during work hours and admitted to having other government clients, resulting in termination and ineligibility for rehire. Another employee used three weeks of sick leave to work at a second job, leading to a $3,200 clawback and resignation. Furthermore, an individual submitted 89 fraudulent benefit claims totaling $14,900, which were repaid before the worker quit.
Broader Fraud Schemes and Hotline Impact
Other notable cases included a developer who demolished a building and concealed rental units to avoid replacement obligations, with City Hall now working to secure housing for affected tenants. Additionally, a multimillion-dollar fraud probe into electricity accounts from 2019 revealed that identities of retirees were used to switch accounts to third-party retailers, costing taxpayers an estimated $2.5 million. Since 2021, the fraud hotline has saved over $10 million in potential losses and recovered $703,000, though only four of 22 substantiated complaints in 2025 led to employee discipline.
Audit Committee Response and Call for Action
Stephen Holyday, chairman of the audit committee, praised the auditor's work while expressing concern over the steady volume of complaints. He urged the public to report fraud via the hotline at 416-397-STOP or online. The report also touched on the contentious SmartTrack transit plan, with Councillor Paula Fletcher criticizing secrecy clauses that hide cost justifications, vowing to push for transparency at council.
