Former officials of Metropolitan Sacco to face court over loss of Sh7bn

Assistant Commissioner for Cooperative Development Hesbon Kiura has revealed plans to surcharge senior executives of troubled Metropolitan National Sacco over the suspected loss of Sh7.2 billion through fictitious dividend payments.

Mr Kiura yesterday said they have written to former officials seeking answers from them after an audit report unearthed the alleged loss of members’ savings.

Mr Kiura said so far they have informed them of the notice to surcharge and if found guilty their property would be sold and the proceeds ploughed back to the once profit-making teacher Sacco.

According to documents in possession of the Sunday Nation, some of the former officials awarded themselves hundreds of thousands of shillings.

“As you can see, the whole plot was to steal and enrich themselves with other staff when they worked at Metropolitan National Sacco and I am not afraid to say that. We have written to 51 individuals who were directly involved in the looting of Sh7.2 billion from the Sacco,” Mr Kiura told Sunday Nation yesterday in Kiambu during the Annual General Meeting of the Sacco.

He added: “We are moving to court to have the assets they bought from members’ savings frozen and potentially sold and money returned to the Sacco."

Conflict of interest

Mr Kiura's sentiments are backed by a letter sent to former staff of the Sacco by Commissioner for Co-operative Development David Obonyo who has informed those accused of the intent to surcharge them in court for stealing from their employer through insider trading, fraud and conflict of interest.

“Take notice that the commissioner for Co-operative Development has been notified that you are accountable for monies indicated against your names in relation to the business of Metropolitan National Sacco Society Limited particulars which are set out in the inquiry report read and adopted in accordance with section 58 of the Co-operatives Societies Act,” reads a letter written by Mr Obonyo and directed to the affected 51 staff accused of siphoning funds from the Sacco.

The letter is dated April 17, 2023, and details who stole what.

‘’Wherefore by way of written submissions you are hereby called upon individually to show cause within 14 days from the date of receipt whereof why you should not be surcharged …take further notice that unless an explanation is received within the aforesaid period an order of surcharge shall be issued without further reference to you,” the letter reads further.

Yesterday, Metropolitan National Sacco adopted austerity measures during its Annual general meeting held in Kiambu town that it hopes will trim its wage bill and revert to profitability.

The members approved the relocation of its head office from Nairobi, where it was paying a monthly rent of Sh1.1 million, and it will now instead relocate to Kiambu in one of the premises it owns.

Also approved by the members was the adoption of a caretaker committee which took over after the board of the Sacco was kicked out of office over fraud allegations. 

The members also elected three members to the supervisory board and unanimously approved a new audit firm.

In a charged AGM, Samuel Muiruri who is the executive secretary of Kenya National Union of Teachers Kiambu East branch, blamed Sacco Societies Regulatory Authority (Sasra) for doing little for 12 years even after being informed that the Sacco was being looted and mismanaged.

“We are where we are today because of Sasra, all along we informed them that things were not okay at the Sacco but they did nothing,” Mr Muiruri said.

Esther Mbaire Kamau who is the chair board of directors of Metropolitan National Sacco expressed optimism that the once vibrant teachers Sacco will triumph back to profitability and urged defaulters to pay back for sustainability.