The Cabinet Secretary for Co-operatives and Micro, Small and Medium Enterprises (MSME) Development constituted a task force to review the status of the Moi University Savings and Credit Co-operative (MUSCO).
The task force comprises Chairperson Joshua Choge and members Eric Kipkoech Korir, Stephen Kibungei, Edward Mutuaruhiu, Javel Murira, Anthony Mkabane, Benjamin K. Rop, Ms. Pamela Moraa, Ereu Totona, Zephaniah Rutto, Malinson Kiprotich Koech, and David Ruto.
The joint Secretaries of this task force will be Elsama Ndegwa and Esther Cherubet Mutai.
In November 2019, the then-acting commissioner for co-operative development, Geoffrey Njang’ombe, moved in with liquidators into Moi University Sacco to recover cash belonging to members.
The Sacco failed to meet the required financial ratios. The lack of cash to settle its obligations led to the initiation of the liquidation process, now nearing its tail end.
According to a gazette notice No 16776, the appointed task force will ascertain the status of membership of MUSCO (in liquidation) and the foregone potential membership since liquidation; establish the financial position of MUSCO, including the status of assets and liabilities of the Society; undertake a review of the financial and non-financial performance indicators of MUSCO prior to appointment of a liquidator and establish the investment trends, portfolio, and compliance challenges faced by the Sacco that led to the appointment of a liquidator, and the probabilities of any resolutions.
The task force will also look at the performance of the Society’s loan book to determine the status of MUSCO Towers in terms of ownership, financing construction operations, and outstanding obligations.
The team will also determine the impact of continued liquidation of the Sacco on its members, clients, and ancillary services. It will also assess the potential social and economic benefits of the Society’s revival in reference to the Bottom Up Economic Transformation Agenda (BETA) in promoting financial inclusion.
The task force will also draw up a revival plan for MUSCO, including redrawing the Society’s vision, mission, governance, operational efficiency and sustainability.
The task force shall remain in office for 90 days starting 7 December 2023, with possible extensions by the Cabinet Secretary.
It is still unclear where the process of liquidating financially crippled Moi University Sacco has reached since appointed liquidators moved in with loan recovery agencies to seek the Society loan defaulters.
It is also unknown whether Moi University Management will be pursued to recover non-remitted Sacco dues running into millions of shillings.
At the time of its liquidation, angry demonstrations were witnessed in Eldoret streets as members of Moi University Sacco protested against the sale of MUSCO Towers.
Co-operative Bank of Kenya was trying to sell this building after the Sacco defaulted on a loan used by the Sacco to put up this head office.
Co-operative Bank of Kenya gave out a loan of Ksh 200 million to Moi University Sacco to put up the MUSCO towers, its head offices located in Eldoret. This loan accumulated Ksh 563, including interest against the value of the building, estimated at over Ksh 350 million.
Moi University Sacco was found to be technically insolvent and unable even to refund contributions by members, most of whom have fled to join other Saccos, including Eldoret University Sacco.
This Sacco was not even able to provide life insurance for deceased members and was totally in the red.
In 2018, the government revoked its license and later placed it under liquidation.
After that, the intergovernmental relations technical committee headed by Prof Karega Mutahi began a conflict resolution process to resolve the impasse.
Members of the troubled Moi University Sacco had previously threatened to move to court to halt the planned sale of the MUSCO towers without their involvement.
Moi University Sacco was among several deposit-taking co-operatives that survived several closures by the Sacco Societies Regulatory Authority (Sasra) after the regulator extended its permits for several months.
