The Kenya Union Savings and Credit Cooperatives (KUSCCO), led by its Chairman David Mategwa, has presented a comprehensive audit report of the losses in the organisation to the Ministry of Cooperatives and MSMEs Development for further investigations.
The forensic audit, covering the union’s operations and financial records, was conducted by Price Water House Coopers (PwC) and revealed massive financial impropriety at KUSCCO with losses exceeding 12 billion shillings.
Speaking in his Nairobi office after receiving the audit report, Cabinet Secretary (CS) for Cooperatives and MSMEs Development Wycliffe Oparanya noted that the findings point to widespread mismanagement, illegal withdrawals, and misappropriation of funds orchestrated by senior board officials who were dismissed earlier in May 2024.
Oparanya confirmed that the report revealed KUSCCO has a deficit of Sh12.5 billion and assured that those involved in the scandal would be dealt with according to the law.
He, at the same time, highlighted issues such as KUSCCO insolvency, where according to the report, liabilities are greater than the value of the organisation.
“There was no oversight over that particular institution because of the gaps within our own laws that were not regulated,” stated Oparanya.
In addition, the CS opined that the general mismanagement allowed manipulation of figures, including the overstating of income and understating of expenditure, which was concealed in the departmental advances.
“So as a ministry, we will look into this report in detail. And then we’ll be issuing a very detailed press release thereafter,” pledged Oparanya, promising to share the report document with all the relevant government investigative agencies responsible for expediting the issue.
Meanwhile, the report will guide further actions to ensure the principles of good governance and integrity are upheld across the cooperative movement in the country.
Following an inspection by the Commissioner for Cooperatives Development in 2023, which revealed serious fraudulent activities at KUSCCO, an interim Board of Directors was appointed in May 2024 to oversee the reconstruction process.
By Michael Omondi and Sharon Atieno
