Oparanya locks out former KUSCCO officers from present sacco roles
Cooperatives and Micro, Small and Medium Enterprises (MSMEs) Cabinet Secretary Wycliffe Oparanya has directed for speedy dismissal of former Kenya Union of Savings and Credit Cooperatives (KUSCCO) nonetheless holding positions of their main Saccos with speedy impact.
This follows a forensic audit report by PWC Kenya which reveals how former KUSCCO officers participated in an intricate net of corruption and mismanagement of funds to the tune of Ksh 12.1 billion.
“I also want to direct the commissioner here, because those people were members of KUSCCO board are member of a primary saccos went back and they are there. I want them dismissed immediately. If they want to go to court they should go and if they are not carefully we shall name them,” warned Oparanya.
According to the forensic audit report, KUSCCO former administrators who had been dismissed in May this yr had been partaking in misappropriation of belongings and corruption regarding inflation of commissions.
The audit reveals that as on the finish of 2023, KUSCCO officers inflated the union’s belongings by a whooping Ksh 10.1 billion which don’t exist out of the Ksh 22.6 billion acknowledged as complete belongings.
On the opposite hand, KUSCCO additionally overstated its liabilities by Ksh 1.8 billion placing its asset base at Ksh 18.6 billion as an alternative of an estimated Ksh 20.4 billion.
From the report, the officers orchestrated bought a non-existent parcel of land at a value of Ksh 45 million which auditors couldn’t find. The officers additionally spent one other Ksh 17 million for the acquisition of a frequency for a radio station it was supposed to determine. This too can’t be situated.
The former director are additionally accused of finishing up unauthorized transactions, inflating fee from a charge of 1pc to three.3pc whereas some companies contracted to hold out numerous companies with union had battle of curiosity.
“For loans that are being issued to sacco members, we found out that there was lack of due diligence because some of those loans were given to institutions who would not pay and of course they had non-performing loans,” mentioned Martin Kimathi, Partners at PWC Kenya.
The audit report is now recommending that the union endure a restructuring together with the subsidiaries with a purpose to maintain it working and handle operational bills, droop curiosity on loans to avert additional improve in non-performing loans
Members additional need the federal government to begin asset restoration from former administrators who’re accused of working down the union.
“We have shared the findings of the report with relevant authorities to carry out investigations and all those found culpable will be held accountable through appropriate legal and administrative channels,” mentioned David Mategwa, KUSCCO Chairman.
Additionally, the report recommends for recapitalization of the union via contemporary capital and conversion of present debt to fairness.
