Saving and Credit Co-operative Societies’ success story has been incredible. The fast growth witnessed in the Sacco sub-sector and the co-operative movement at large points to prudent management and visionary leadership.
But this does not mean the co-operative movement in Kenya is free from corruption. Thousands of people have lost their money in some co-operatives owing to inept and corrupt leaders and managers.
On this backdrop, the government has been keen to institute measures aimed at strengthening governance in the co-operative sector. With sustained efforts, the road for corrupt Sacco officials and directors, with a habit of dipping their hands into the cookie jar, has steadily approached the dead end.
In 2019 Ethics and Anti-Corruption Commission (EACC) did indicate that it would conduct a lifestyle audit of all Sacco directors and managers in collaboration with the State Department for Co-operatives. Some are suspected of having stolen cash or taken away assets from their societies.
EACC signed an anti-graft deal with the State Department for Co-operatives to tame graft in the movement. The proposed lifestyle audits on top managers, tracing, and recovery of stolen assets are yet to be conducted.
EACC was to assist the State Department in monitoring co-operatives leaders and managers to prevent graft and catch corrupt officials by tracking their assets.
Of concern are the increasing cases of poor decisions made by officials in several co-operatives that have cost members dearly, such as buying undervalued properties at exorbitant prices.
In recent years, concerns have been rising over an increasing number of co-operative societies caught in the limelight for allegedly selling non-existent plots or houses to members.
However, it should be understood that Saccos have their own internal control mechanisms, such as the Board of Directors, Supervisory Committee members, or Delegates, who make recommendations to members on corruption issues. All these organs act on behalf of members, besides Saccos employing internal and external auditors who give recommendations on what is to be done when an official is accused of theft or corruption.
In addition, members as the owners of the Sacco elect directors to serve in the Board for a three-year term and thus have a responsibility in voting out corrupt officials.
The Sacco Fraud Investigation Unit has made significant progress in the graft war in the co-operative movement. In February this year, Agriculture and Co-operative Cabinet Secretary Peter Munya revealed the unit had arrested two people for fraud-related charges, finalized an investigation, instigated arrest and prosecution. He said that Ksh 1.3 million embezzled funds had been recovered in one case.
