The Mt Kenya Times 
MSMEs Cabinet Secretary Simon Chelugui
By Sefu Sabila
On Wednesday, Cooperatives and Micro, Small and Medium Enterprises MSMEs Cabinet Secretary Simon Chelugui issued a statement on allegations made by the Kenya Union of Savings and Credit Cooperatives (KUSCCO), on Saccos Societies Regulatory Authority (SASRA) on social media.
According to the allegations, KUSCCO accused SASRA of interfering with its operations. It further alleges that SASRA has no authority over it and that it is only answerable to its members and the Commissioner for Co-operative Development. It also claims that SASRA’s notice was issued in bad faith and without duet process.
On November 15th 2023, KUSCCO obtained a court order barring the Sacco regulatory authority SASRA from conducting an audit of its operations.
According to CS Chelugui Statement on X, the directive is in accordance to section 49 of the Sacco’s Act that gives the authority to inspect a Sacco as ordered by the minister and also the authority shall assist any investigative authority regarding matters of suspected fraud or malpractices in Sacco societies either by identification of such matters for referral or at the request of such by the authority.
“This directive was issued pursuant to section 49 of Sacco societies Act. SASRA commenced the inspection and provided constant updates on the progress. However, on 15th November 2023 the inspection was stopped through a court order.” Read the statement by CS Simon Chelugui.
In the statement, the CS has stated that through his office, the legal ways shall be followed to ensure the security of Sacco funds KUSSCO, and the Ministry shall give a detailed statement at an appropriate time.
Allegations about the operations and licensing of KUSSCO were first raised by former Central Bank of Kenya CEO Dr. Patrick Njoroge, through a letter to SASRA. He stated that KUSSCO members had raised concerns and expressed fear that their funds were not protected; saying that KUSCO was involved in deposit-taking and lending activities without a valid license and that SASRA was the suitable institution to regulate and investigate KUSSCO.
The statement further touching on an inquiry of Metropolitan Sacco, which an inquiry into its financial transactions and governance practices was reccommended by SASRA. Confirming of the finds through a collaboration between his ministry and SASRA in the statement, the CS states that a notice of surcharge was issued to specific officials suspected of mismanaging the sacco.
” This action had been met with legal resistance,as the implicated officials went to court challenging the inquiry findings and therefore surcharges against them. The matter is before the court for determination. ” Stated the CS in his statement.
“However, I have referred the matter to the DCI to probe into potential criminal conduct, including theft and fraud by these officials. Ministry through SASRA and the office of the Commissioner for Cooperatives are pursuing amounts due to the network which is estimated at Kshs. 87 Million as at October 2023.” Stated the CS.
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