Gov’t embarks on liquidation of KUSCCO assets to recover misappropriated funds

The government will set up a nine-member board to ensure the revival of Kenya Union of Savings and Credit Cooperatives (KUSCCO).

Cooperatives Cabinet Secretary (CS) Wycliffe Oparanya says the Cabinet has approved the appointment of a committee of experts to review the SACCO's Societies Act.

The government has also embarked on a liquidation process of KUSCCO assets as part of its efforts to recover some of the funds that were misappropriated at the institution.

Among the assets set for liquidation are the companies' vehicles, which have already been disposed of, as well as investments in housing. Despite the efforts, the Ministry has expressed low optimism, even as they give SACCOS at least two years to begin receiving any kind of cash.

“Already, small savers have been refunded Ksh.136 million,” said Oparanya.

Although CS Oparanya insists that no funds were lost in the process, the government has committed to pursue those involved in the misappropriation of funds.

“As long as you are alive, we will pursue you,” he said.

The government now says it has been able to reconstruct KUSCCO books of accounts, setting the stage for more recoveries to be made. Going forward, Oparanya says the institution will only be allowed to stick to advocacy as its core business.

“For the insurance business, we will have to look at how it’s performing and maybe we can sell it off,” he said.

The Ministry will further institute reforms to ensure there are no gaps in the law, allowing SASRA to provide oversight even as the CS hinted at tighter regulation for the sector, which controls over Ksh.1.2 trillion in savings, with an asset base of Ksh.1.8 trillion and a loan book of over Ksh.1 trillion, representing at least 30 percent of the GDP.