KUSCCO (Kenya Union of Savings and Credit Co-operative Society) Housing Unit, a subsidiary that was set up under the Union’s now cash-strapped Central Finance Fund(CFF), is under investigation by the Office of the Commissioner for Cooperative Development.
The move follows the dramatic collapse of the giant Union, dragging along with its assets and financial investments to the tune of close to KSh 13 billion through suspected fraudulent dealings by members of its dismissed Board of Directors. A caretaker team has since been appointed, led by Kenya National Police SACCO, to salvage the Union and pay off lost investments that were sunk into it by member SACCOs.
KUSCCO Housing Cooperative properties are valued at approximately KSh 5 billion as of March 2025.
Available data shows that the insolvent KUSCCO had liabilities of KSh 17.7 billion against assets of KSh 5.2 billion, indicating a significant financial shortfall.
An audit reveals that KUSCCO had irregularly transferred over KSh 318 Million to its housing unit, a subsidiary that operated without proper oversight or integration into KUSCCO’s core financial operations.
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Flows into its housing subsidiary worsened KUSCCO’s liquidity crisis and made it difficult to trace members’ deposits.
The Union owns vast real estate properties, a rich pipeline of properties that includes Houses, Plots of land, Apartments and Commercial buildings, located mostly in Nairobi, Kisumu, Kiserian and Kitengela in Kajiado County.
An estimated KSh 8 billion, obtained from suspected fraudulent transactions and mismanagement, was pumped into these properties, sums that the auction intends to recover.
KUSCCO Housing Fund (KHF) was established in 1996 to mobilise funds and provide mortgage solutions to Co-operators and Co-operatives in Kenya.
As the caretaker board gets down to trace some of the assets of KUSCCO so as to refund SACCOs that had sunk millions into the Union, the amount of losses that SACCOs may have suffered in terms of not being able to provide credit to their members is still unaccounted for.
Some of the SACCOs that suffered from the KUSCCO exposure include Kenpipe SACCO, which invested KSh 149,180,285.00 in fixed deposits with KUSCCO and another KSh 698,113.00 held under the KUSCCO Juu Kuu Savings product. Kenpipe SACCO has made a provision of KSh 119,344,228 as provisions for its impaired assets held by KUSCCO in its 2024 financial statements.
Balozi SACCO has KSh 437.6million exposure in KUSCCO, including a 4% provision already made in the 2024 accounts. The Society has placed some KSh 299.2m under the Special KUSCCO Deposits, while interest for Savings with KUSCCO is booked at zero, down from KSh1.87m in 2023.
Qona DT SACCO, formerly Safaricom SACCO, has an exposure of KSh 134.7m in KUSCCO, made up of KSh 104m in interest-earning deposits and shares worth KSh 30.7m. The Society has made an impairment charge of KSh 26.16m in its 2024 financial statements.
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Kimisitu DT SACCO has made an impairment charge of KSh 353.95m, due to short-term deposits and investments made by the Society in KUSCCO Limited.
Kenya Highlands DT SACCO has made provisions for its shares in KUSCCO worth KSh 4,042,558.00 in the 2024 financial statements. The Society has also suffered an exposure of KSh 310,000 worth of shares that it owned in the now dissolved Kenya Rural SACCOs Union(KERUSSU).
Tower DT Sacco lost shares at KUSCCO worth KSh 41,087,914.00 and has made provisions of KSh 28,724,940.00 in its 2024 financial statements.
Univision Deposit-Taking Sacco, formerly Kitui Teachers Sacco, made a provision for loan losses and impairments at KSh 120 million for the 2024 period.
Nyati SACCO invested KSh 86.4m in fixed deposits, KSh 4.18m in KUSCCO deposits and KSh 690,005.00 in KUSCCO shares.
Nyati SACCO has instituted legal proceedings to recover KSh 86.4m in fixed deposits held at KUSCCO. The matter is still pending at the Milimani Commercial Courts in Nairobi.
By Okoth Jackson
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