TCHC employees have reported contractors offering them “envelopes filled with cash,” an outside auditor has told the city-funded social housing agency.

The revelations are among preliminary audit findings relayed to Toronto Community Housing Corp. by the firm hired Jan. 2, after TCHC chief executive Gene Jones received tips about possible fraud involving repairs.

The auditor cited “a few” instances of employees being offered, and refusing, cash, apparently in return for work being steered to them, according to a source who asked for anonymity because the individual is not authorized to speak publicly about the briefings.

Staff also reported “vendors” offering them basketball tickets.

As well as TCHC, the auditor is looking at defunct subsidiary HSI Solutions Inc., which provided construction and maintenance services to TCHC as well as other public- and private-sector clients, the source said.

Nine-year-old HSI was shut down last fall after it failed to become a money-maker and tenants complained about repairs and upkeep. A 2008 HSI presentation said the city-owned agency employed “250 professionals, specialists, tradespeople and contract centre agents.”

Repair work being examined by the auditor includes “mechanical” jobs such as plumbing, the source added.

Jones expects to get audit results within two weeks and, if the findings warrant, launch a full investigation. Employees and vendors who broke rules could be disciplined, terminated or subject to a police probe, he has warned.

Jones said Wednesday audit findings pointed to “a pattern where we think there may be some kickbacks,” plus double billing and “shoddy” repairs.

Jones told the Star in an email Thursday that, one day after he invited tipsters to contact him, he had received more than 50 phone calls and emails.

“A number of the messages thank me for doing what I am doing and point out long-standing unfinished repairs in their units and communities,” he wrote. “Other residents have told me about some of the poor customer service they have received from staff.

“I am glad these calls are coming in because it shows that residents trust us to address their concerns and take action to make things better.”

Asked later to comment on audit details revealed to the Star, Jones wrote: “Our first priority is the integrity of the investigation. As a city corporation we are committed to transparency. When the investigation is completed we will disclose the findings and our action plan, as I have promised, to the board of directors, residents, employees and the media.”