Sacco collapses with Sh33m savings

By Malachi Motano

Kumisa Savings and Credit Cooperative (Sacco) members have appealed to the Directorate of Criminal Investigations (DCI) and the Commissioner for Cooperatives to help them recover their savings

The Sacco based at Kirigiti in Kiambu town, also referred to as ‘Hustlers Sacco” is a Sh10 savings society which has collapsed with millions of shillings in members savings.

Over 3,000 members sought an audience with Kiambu Sub-County Cooperative officer Stephen Mwangi over their deposits.

Some have also moved to court seeking assistance to recover their hard earned cash that they had painstakingly saved.

The Sacco started by former Riabai Member of County Assembly  Martin Wachira targeted low-income earners like hawkers, market sellers, touts, casual labourers and domestic house workers.

They all welcomed the idea and joined in droves, giving it the impetus it needed but the MCA later handed it over to the Sacco to members as he sought to focus on his political career.

The chairman of the supervisory committee Henry Kinge who was appointed by members after the former management was accused of running down the Sacco said it performed well in the first two years after its inception.

“The Sacco was doing well as members would save and take loans but due to poor management but those in management misused our cash and did not follow up on loan repayments,” said Kinge.

Some of the money saved by members was also used inappropriately by the management.

He traces the problems to a mega project of the management engaged in of rearing pigs and chickens to boost their investment.

The chicken project failed but the pig project went on smoothly although there was little to show for it.

“After some time, as the supervisory team, we came to realise that the management had registered the pig project under a private company and not Kumisa Sacco,’ said Kinge.

The discovery came too late because the management could not account for some money and the Sacco was going down.  

The Kianbu District Cooperative Officer Peter Mwangi said the Sacco was being operated through fraud as most of the daily savings were not taken to the bank.

The money instead ended up in officials’ pockets while the the Sacco owed Sh912,000 forcing the landlord to auction its property to recover the debt.

Records show the Sacco whose membership was drawn from Kirigiti, Riabai, Mai Mahiu and Maera raised more than Sh11 million in the first year they and more than Sh33 million after two years.

“All over a sudden, members were informed there was no money when they applied for loans, yet the total assets were in excess of Sh33 million and that is when we realized money had been embezzled,” said Kinge.

The pig-chicken projects cost members Sh1.4 million but they  were told all the chicken died and the profit from the pig sales was so low but the money was not traced.

“The pig project was registered under a limited company owned by five members who were in the Sacco management with shares of 100,000 split among themselves equally,” Kinge said..

That further showed that the Sacco facilitated the project without members’ knowledge

Tthey wrote to the Kiambu Sub- County Cooperative Officer asking the Commissioner for Cooperatives to conduct an enquiry into the scandal.

“The commissioner for cooperatives responded saying the Sacco should pay money for the enquiry to be conducted, but in the Sacco accounts the balance was zero,” Kinge said.

There were so many accounts opened for the Sacco and it seemed to one way by the management used to syphon member’s hard-earned cash.

The commissioner has agreed to investigate but at a fee of Sh400,000 but members say they cannot afford the fee.

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