Government investigators are looking into a massive KSh 13 billion fraud at the Kenya Union of Savings and Credit Co-operatives (KUSCCO), a scandal that has affected top savings societies across the country.
A forensic audit by PricewaterhouseCoopers (PwC) found that KUSCCO forged financial records for seven years, mismanaging KSh 24.8 billion in deposits from 247 SACCOs.
This revelation has sent shockwaves across the co-operative sector, leaving many members uncertain about their savings.
Co-operatives Cabinet Secretary Wycliffe Oparanya officially handed over the audit findings to Police Inspector General Douglas Kanja. Oparanya warned that members may never recover their money due to the complicated and lengthy legal process.
This statement has sparked outrage among SACCO members, who now fear financial ruin. Many had entrusted their savings to KUSCCO, believing it to be a stable and reliable institution.
Among the most affected SACCOs is Kenya National Police DT Sacco, which holds 1,629,312 shares in KUSCCO, accounting for 6.97% ownership.
The police-backed SACCO, which has assets worth KSh 59.8 billion, is the second most impacted institution in the fraud case. IG Sacco, based in Kakamega, is the most affected, with 1,883,667 shares in KUSCCO, controlling an 8.06% stake.
This has raised concerns among police officers and other members, who are now demanding accountability.
Harambee Sacco is also among the affected institutions, holding 1,416,896 shares, representing a 6.07% ownership in KUSCCO. Nacico Sacco, which holds 1,244,969 shares and owns a 5.33% stake, is another major victim of the scandal.
Newfortis Sacco from Nyeri completes the list of the top five affected societies, with 830,529 shares, giving it a 3.56% stake in KUSCCO. These societies, which serve thousands of members across various professions, now face a crisis as their investments are at risk.
Investigations by Grant Thornton auditors uncovered suspicious cash transfers to staff accounts. The audit report also revealed irregular land deals and questionable insurance transactions.
These findings point to deep-rooted corruption and mismanagement within KUSCCO, with top officials allegedly benefiting from the fraudulent activities.
As a result of these findings, the government dissolved the KUSCCO board in May last year. Several top managers were fired after being implicated in KSh 6.5 billion in financial misconduct.Police investigators have received crucial documents detailing questionable transactions carried out over the seven-year period.
Deposits from teachers, medical workers, and prison staff societies were among those affected by the scandal.
Many members are now left wondering if they will ever get their money back, as the legal and financial complexities surrounding the case continue to unfold.
The probe is expected to reveal more details in the coming weeks, as authorities seek to bring those responsible to justice.
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