Derby taxi licences granted to convicted criminals
Taxi licences were granted to individuals with criminal convictions by Derby City Council, an external audit of the authority has revealed.
Auditors also reported a number of other "failings" and said the council had a culture of "holding back bad news".
Concerns were raised over licences being handed out to people who had committed hate crime offences.
The Labour-led council said it has now "tightened the rules" over licensing.
Auditing company Grant Thornton said council members had lobbied on individual drivers' behalf between 2012 and 2015.
It also said the council's own review revealed "poor decisions" were made in relation to the granting of taxi licenses to individuals with criminal records.
Those offences included "hate crime, harassment, intimidation and making improper comments to young females".
- Costs of £1.2m incurred through mismanagement of a major project to respond to equal pay legislation
- Spend of £2m helping a call centre firm insure the protection of hundreds of jobs, without proper legal checks being made on EU laws
- In 2014, £500,000 was spent on hiring a consultant to implement a new payroll system because a council-led team "was not effective"
- Council officials told auditors there was a culture of "holding back bad news or putting a gloss on appearances"
The firm said the council had taken "positive action" in the last 12 months to address these problems, but "further action may be required".
Paul Robinson, Derby City Council's chief executive, said it was doing a full review of its taxi licensing system and added the drivers had "paid their debt back to society".
He said: "We have significantly tightened the rules around how people get taxi licences.
"We're looking at a transparent points system where you would score each application against a number of set criteria."
Mr Robinson insisted the auditor's concerns were over governance and not about public safety.
Derby City Council's leader Ranjit Banwait said: "Many of the matters reported occurred some time ago and the council has already taken a large number of improvement actions through a governance action plan."
The report will be referred to full council for debate within the next month.