Fake invoices were used to misappropriate millions of dollars of Botany Bay ratepayer funds, according to a corruption inquiry also set to examine the alleged misuse of council cars, phones, etags and fuel cards by staff and their relatives.

Counsel assisting the Independent Commission Against Corruption (ICAC), told Monday's hearing that the more than $4.2 million diverted through fraudulent invoices by council's former chief financial officer Gary Goodman and others was just the tip of the iceberg.

"These amounts are only for the period from the beginning of 2009," Sydney silk Murugan Thangaraj said. "ICAC has evidence of false invoicing stretching back to 1997."

Mr Goodman is the principal person of interest for Operation Ricco, which coincides with a fraught period for the embattled corruption watchdog facing sustained attack over its controversial inquiry into Crown Prosecutor Margaret Cunneen, SC.