The High Court has thrown out a petition filed by former officials of the troubled Metropolitan National Sacco, who were seeking to block investigations into financial mismanagement uncovered nearly three years ago.
Lady Justice Aburili Roselyne Ekirapa, in a ruling delivered on May 21, 2025, rejected the plea and directed the disgruntled officials to seek redress through appellate mechanisms instead.
“Accordingly, this court, therefore, finds that the applicants (sacco officials) and the interested parties had a clear, available, and effective remedy under Section 74 of the Co-operative Societies Act, which they have failed to pursue and they have also not sought to be exempted from resorting to the appeal mechanisms stipulated in law,” the judge said.
“In the result, I find that the application dated February 14, 2022, offends the exhaustion doctrine and is premature. The notice of motion is hereby struck out,” she added.
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The former officials had filed the petition seeking to quash an inquiry order dated April 20, 2022, which recommended the dissolution of both the management and supervisory boards. They also sought to block any administrative actions, decisions, or measures taken by the Commissioner of Co-operatives based on the inquiry findings.
Additionally, they asked the court to prohibit the Commissioner for Co-operatives and the Attorney General from handling or acting on the report and any related recommendations deemed detrimental to them.
The 2022 investigation, ordered by Commissioner of Co-operatives David Obonyo, exposed significant financial mismanagement. Among the irregularities were Kshs 49 million in M-Pesa transactions by a single teller at the Sacco’s Nakuru branch, and a Kshs7 billion overstatement in the Sacco’s premier loan facility due to suspected disbursements to non-existent members.
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An audit further revealed that management had misled members with false dividend payments drawn from their own savings, despite there being no surplus reserves. The Sacco had claimed Kshs 28 billion in cumulative assets, but external auditors determined the actual value to be slightly above Kshs 14 billion.
Other discrepancies included Kshs 490 million in non-performing loans irregularly issued to employees and an inability by branches in Kiambu, Thika, and Kisumu to account for Kshs 176.9 million.
The High Court’s decision now compels the former officials to seek alternative legal avenues if they wish to challenge the findings and recommendations of the inquiry report.
By Cornelius korir
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