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The employee was interviewed on Oct. 3, 2024 and told investigators they worked with the landlord part-time, but had not disclosed that relationship with anyone at the city.
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That constituted a breach of the city’s code of conduct, according to the report.
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Investigators obtained banking records and data contained on the former employee’s personal devices.
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They found “several messages between Employee A and the landlord that would indicate that these
payments were made by the landlord with the intention to utilize Employee A’s role at the city to provide a financial benefit to the landlord.”
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One message from the landlord to the then-employee stated: “Is there any way you can put a couple in there and get me a higher rent, like $2,300 or what can we do on this thing? It’s a one-bedroom apartment, if you get me the rent, of course the bonus will be much larger.”
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Investigators observed “multiple factors” that indicated the payments “are consistent with a kickback scheme designed to provide a benefit to both the landlord and Employee A.”
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The employee was fired between October and December 2024.
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A second former city employee — referred to as Employee B in the report — is a family member of the accused employee who had knowledge of the alleged kickback scheme and did not disclose that information to the city. That was considered a breach of the city’s code of conduct.
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Investigators also observed “that Employee B was directly involved with collecting payment from the landlord to Employee A.”
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The second employee resigned, Gougeon told the committee.
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City management agreed with a staff recommendation to halt all business relationships with the landlord and said in December “a plan is underway to terminate all existing business relationships with the landlord as it relates to housing allowance programs.”
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Investigators identified 31 affected tenants who had a rental relationship with the landlord, Gougeon told the committee in December.
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Staff were creating “individualized transition plans” to find alternate accommodations for the affected tenants who were still residing in units owned by the landlord.
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The report cites “multiple instances” where the housing case worker assisted clients in entering into leases on units that “significantly exceeded the market value.”
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In one example, a client in need of housing signed a lease for a three-bedroom unit in the Ledbury/Heron Gate neighbourhood for $4,050, which is 63 per cent above the average rent of $2,491.
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In another example cited in the report, a client signed a lease for the same $4,050 rent in the Pineview area, which is 46 per cent above the average of $2,775.
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The report states there is a possibility that “such significant increases in rental amounts may have resulted in inflationary rental prices in these areas.”
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