Auditors have been called in to probe the government-created agency that recycles used tires in Ontario after a Star expose detailed spending on luxury hotels, alcohol and donations to the Liberal Party of Ontario.

The Ontario Tire Stewardship — funded by consumer “eco-fees” — will be scrutinized for its spending, contracts, plans for its $50-million surplus and a recent allegation that a departed executive stole recycling fees, said Michael Scott, CEO of Waste Diversion Ontario, which oversees recycling programs.

“We will need to ensure the auditors go as deep as they need to, to address any issues of trust and transparency,” Scott said. “It’s very important that the public trust in these programs is maintained. Trust is crucial.”

The probe will ultimately look at Ontario’s two other recycling organizations for electronics and household hazardous waste.

The tire stewardship is Scott’s priority — “obviously because of the revelations that were published by the Star,” Scott said, and because it hasn’t yet been audited.

A review was expected but the stories exposed the need for a more rigorous investigation, he said. “We will look much more deeply into the expenditures that we now need to look at,” Scott said.

“We’re going to be very clear with the auditors we retain that we expect a level of transparency from (recycling organizations) and particularly the Ontario Tire Stewardship.”

Credit-card statements obtained by the Star included stewardship retreats to a high-end resort on Lake Rosseau, a Niagara Region wine-tasting tour, and a $16,104 bill for 13 staff and board members from the Fairmont Chateau Laurier in Ottawa.

Receipts detailed a $288 dinner for two — elk tenderloin and wild boar chops — at Etobicoke’s Via Allegro and hefty booze bills from a trendy King St. E. restaurant.

Compared to the millions collected, the expenses aren’t huge but they show how tire executives spent some of the fees consumers were forced to pay.

Among the expenses that will come under the audit is a $3,200 political donation by the tire stewardship for a foursome in the Liberals’ 2015 Summer Golf Classic with Premier Kathleen Wynne. Tire stewardship executive director Andrew Horsman and chair Glenn Maidment were part of the foursome. Maidment previously said he and Wynne discussed tire-recycling issues.

In earlier stories, Maidment called the spending “fair and reasonable,” because producers and retailers of tires fund the stewardship. Those corporations then pass on all of their costs to consumers.

Shortly before the 2014 provincial election, the tire stewardship paid $1,000 for two tickets to a Liberal event for then-environment minister Jim Bradley and MPP Eric Hoskins. The stewardship also gave several hundred dollars to the NDP.

Details of the political donations came as a surprise to Scott, of Waste Diversion Ontario.

“I don’t think it’s appropriate,” he said. “We will be looking at that kind of issue very carefully in the audit.”

Investigators will be asked to scrutinize spending on dinners, trips and alcohol, along with contracts, using “best practices” followed by the Ontario government. Auditors must identify “any variances,” according to the request for proposals (for an auditing firm) posted by Waste Diversion Ontario last Tuesday.

Another item that will be subject to scrutiny by auditors is an allegation in a lawsuit filed last week by the tire stewardship, stating that a former chief financial officer and other unnamed “individuals” diverted $346,565 in tire recycling fees from a tire importer to a bank account in the name of “Ontario Tire.” The allegation, contained in a statement of claim filed last week by the stewardship, states that the former CFO, Perminder Kandola, set up the bank account and was responsible for the “misappropriation” of the funds. The tire stewardship states that it conducted an audit and discovered the fees from the tire importer never arrived in the proper stewardship account.

Kandola, who resigned last year from the stewardship, did not respond to messages from the Star. The allegations have not been tested in court and Kandola has not filed a statement of defence.

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Tire stewardship executive director Horsman told the Star Friday that in addition to the civil action and attempt to recoup the funds, “we are working with the authorities to determine if criminal activity took place.”

Waste Diversion Ontario’s Scott said he is aware of the allegation of missing funds and will demand the stewardship’s internal forensic audit. “It certainly is a matter of concern,” Scott said. “We want to make sure when we do the program review that the proper level of scrutiny and safeguards are in place so it doesn’t happen again.”

Consumers collectively paid $393 million in tire recycling fees between 2009 and 2014. Current fees are $4.25 for each tire for a car or truck. The Etobicoke-based program oversees the recycling of 12 million tires a year.

The stewardship’s Horsman said the audit was expected, calling it “business as usual.” In an emailed statement, he said it makes sense to get a “state-of-the-programs and market” report because new waste legislation is pending.

“OTS looks forward to collaborating through the process and continuing our existing transparent approach with WDO,” Horsman said.

The proposed Waste-Free Ontario Act, Bill 151, is expected to pass this spring. It would eventually dismantle the recycling organizations and return to a more competitive system; Waste Diversion Ontario would be replaced by an organization with tougher oversight.

Details uncovered by the probe will help with the transformation to a new system, said Rob Cook, CEO of the Ontario Waste Management Association. “That’s a direct result of the work the Toronto Star has done to bring the issue forward,” Cook said.

He warned that Waste Diversion Ontario may not have the power to uncover details of line-by-line expenses, program information and market analysis.

“The (stewardships) already stonewall them when they ask questions,” Cook said. All of the recycling stewardships — for tires, electronic waste and household hazardous waste — do this, said Cook, whose association represents more than 300 public and private waste organizations.

“We have been told by multiple sources that they have on many occasions resisted giving Waste Diversion Ontario information and made it as difficult as humanly possible.”