AUBURN ratepayers lost more than $5 million because of their council's failure to responsibly manage public assets, a government report has found.

A Department of Local Government investigation into the council found that Sarkis Nassif's company, Holdmark Developers Pty Ltd, was able to buy land from the council in Queen Street, Auburn, for $1.8 million despite council having obtained valuations of between $7 million and $9 million.

The report, which the Local Government Minister, Paul Lynch, tabled in State Parliament yesterday, has been forwarded to the Independent Commission Against Corruption.

While the inquiry by Paul Terrett, a senior investigations officer, found no evidence of wrongdoing on Mr Sarkis's part, the report found that the developer had been granted a number of concessions by the council. Apart from the sale of the land for million of dollars less than its valuation, the council had granted an increase in floor-space ratio and had accepted the developer's estimate of the cost of the development, which in turn affected the amount of contributions the developer had to pay.

"Taken as a totality, the monetary value of the apparent 'concessions' to the developer - in addition to other possible concessions not addressed by this review - stretch credulity," the report says.

The report also found that non-compliant fire and safety standards in Auburn Central, which comprises six residential towers with commercial premises underneath, was the fault of council, which the developer had appointed as the certifying authority.

"It was evident that staff did not have the necessary skill, experience and training to certify a large residential development," Mr Terrett said.

"The NSW Fire Brigade has indicated that it has serious concerns for the safety of the building's occupants."