The health benefits fraud scam at the Toronto Transit Commission involved investigating 600 employees in an alleged $5.1 million racket, according a report by Toronto’s auditor general.
In her 2015 annual report on fraud and hotline activities, Auditor General Beverly Romeo-Beehler reports that a “City Agency” is investigating “over 600 employees that submitted health care claims to the organization being investigated for fraud.”
That works out to about five per cent of all TTC employees. The TTC says that not all 600 employees are necessarily guilty of fraud.
“The total benefits paid out to the service provider was $5.1 million, representing the City Agency’s potential exposure.”
According to the TTC, 12 employees have been dismissed for allegedly making false health claims paid out by the company’s insurer, Manulife Financial.
Last July, police laid several charges against the owner of Healthy Fit, which was providing health care products and services to some TTC employees.
“It is only right that we take a very tough line on dealing with this matter,” said TTC CEO Andy Byford in November. “Not only does this put our benefits package at risk, it also undermines the credibility and honesty of each and every one of us in the eyes of the public, just as we are working so hard to restore our reputation.”
Because of the alleged scam, Romeo-Beehler will audit the management of city health and dental claims as part of her 2016 work plan.
The document also confirmed that the purchase of incorrect software licenses in 2015 cost the city about $700,000.
“The Auditor General reported that this error may have cost the City in the range of $700,000 more than if the correct software had been acquired in the first place,” the report reads.
And there were two instances of “time fraud” that cost the city $51,000 and caused two city employees to lose their jobs.
According to the document, one employee submitted false or inaccurate information on time logs, accounting for 800 hours of work that were never done. That cost the city about $40,000.
And another employee apparently claimed jury duty for 44 unaccounted days while the court was on recess. That loss amounted to $11,000.
Both employees were fired.
There were 572 complaints and 800 allegations submitted to the Fraud and Waste Hotline in 2015. Most of the complaints included conflicts of interest, time theft and subsidy fraud. The losses associated with the substantiated allegations came to $209,000.