KUSCCO is the umbrella body of savings and credit cooperatives (saccos) in Kenya....CONTINUE READING THE FULL ARTICLE>>>
The Ministry of Cooperatives and Micro, Small and Medium Enterprises (MSMEs) on Monday, May 6, announced the dismissal of the Kenya Union of Savings and Credit Cooperative Organization (KUSCCO) board of directors.
This decision follows revelations of substantial irregularities uncovered during a recent inspection conducted by the Commissioner for Cooperative Development in October 2023.
“The Ministry acknowledges the findings of the inspection, which revealed significant discrepancies in the management and operations of KUSCCO,” stated Cabinet Secretary Simon Chelugui in a statement on Monday.
“As custodians of cooperative resources, we remain steadfast in our duty to ensure responsible and transparent management for the benefit of all stakeholders,” he added.
The inspection unearthed a range of concerning findings, pointing towards systemic deficiencies in the management and operations of KUSCCO.
Among the discrepancies highlighted were significant cash withdrawals totalling Sh5.5 billion between February 2013 and April 2024.
The probe also unearthed suspicious cash transfers amounting to Sh318 million, and questionable loans disbursed to senior KUSCCO staff and directors, including the Group Managing Director and Company Secretary of KUSCCO Housing Society.
“Despite the losses incurred, KUSCCO proceeded to declare bonuses, dividends, and interest, a practice that cannot be condoned,” added Chelugui.
In response to these revelations, a consultative meeting held on April 25, 2024 with representatives from depositors unanimously agreed that the current board of directors had failed in its duty to effectively oversee the union.
Consequently, the Ministry of Cooperatives and MSMEs, led by Cabinet Secretary Simon Chelugui, has taken decisive action by dismissing the existing board with immediate effect.
“This decision was made in the interest of ensuring accountability and restoring confidence in the cooperative sector,” affirmed Chelugui.
To ensure accountability and restore confidence in KUSCCO, the Commissioner for Cooperative Development has been directed to appoint an interim board comprising fifteen members from respected leaders of affiliate cooperatives.
This interim board will be tasked with overseeing the transformation and rehabilitation of KUSCCO, with the support of a dedicated technical team.
“This interim board will work diligently to address the identified challenges and steer KUSCCO towards a path of transparency, accountability, and sustainable growth,” assured Chelugui.
As investigations continue and reforms are implemented, stakeholders will be watching closely..CONTINUE READING>>
