Greater Sudbury's Auditor General said city staff knew hundreds of thousands of dollars were missing from municipal coffers and did nothing.
The findings are in a new report being presented to city councillors this week.
The auditor's report deals with a private contractor that ran a kiosk in the downtown bus station between 2004 and 2009.
The company sold bus tickets on behalf of the municipality, but did not give the city its share of the revenue — some $866,000.
After closing the kiosk, the city successfully sued the company, recovering about $287,000.
But Auditor General Brian Bigger said staff gave him no compelling explanation as to why other lawsuits were not launched to get the remaining $579,000.
The report said city managers knew that this company was shortchanging the city, but did nothing about it for months.
The audit report lists 21 recommendations on how the city can prevent this from happening again and will be heard by city councillors at an audit committee meeting on Wednesday.
The auditor general’s report noted the city needs to:
- Improve the quality of contract drafting, management and oversight
- Improve the controls surrounding payment processing and oversight
- Improve the due diligence performed by the city in awarding contracts
- Clarify the application of the user fee bylaw related to the recovery of interest on overdue amounts owed the City
"Implementing the recommendations contained in this report will strengthen controls (and) improve management’s ability to manage contracts and make necessary changes to safeguard public funds, noted Bigger in the report.