A $2.5-million fraud scheme involving city-owned properties in Toronto has been uncovered, prompting an investigation by the city council and police. In 2019, 14 electricity accounts were switched from Toronto Hydro to third-party retailers without city awareness. Fraudulent contracts were signed using the identities of retired employees from the corporate real estate management department. The audit committee recommends improving controls, encouraging invoice diligence, and involving other departments in mitigating risks for future transactions. Though the investigation began in 2020, it was paused due to COVID-19 before resuming in 2024.
The auditor general's office found that in 2019, 14 city-owned properties' electricity accounts were switched to two different third-party energy retailers instead of Toronto Hydro without the city's knowledge.
Auditor general Tara Anderson emphasized the importance of good controls to detect fraud: 'There's always the risk of identities being stolen and that fraud could be committed.'
The audit committee is recommending that council request the city manager forward the investigation to other departments to encourage diligent invoice reviews and approvals.
The investigation began in 2020 but was paused due to the COVID-19 pandemic and resumed in 2024.
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