Sixteen officials of Metropolitan National Sacco have denied defrauding members of the society Sh14.497 billion.
Appearing before a Nairobi court, the officials denied a total of nine counts, including conspiracy to defraud contrary to Sections 317 of the Penal Code, investing funds in a none-core business, failure to report proper accounts, failure to maintain accurate accounts, failure to maintain 15 percent of its savings deposits and short term liabilities.
They were also charged with failing to establish a credit committee, failing to maintain proper books of accounts, to appoint an internal auditor, and to ensure all loans are fully secured.
The charge sheet stated that they committed the offences on diverse dates between 2012 and 2021 at an unknown place in Kenya, with intend to defraud the Sacco of the amount.
Further charges stated that the officials unlawfully invested more than Sh1.014 billion belonging to the said co-operative society in buying land at Kitengela in Machakos County, an investment which was not a core business of the society. The said land was bought between 2014 and 2021.
The accused were further accused of failing to report proper accounts reflecting the true and fair state of Metropolitan National Sacco between 2012 and 2021.
The court heard that being officials of the Sacco and charged with the responsibility of managing its affairs, did fail to keep proper books of accounts as required by the Commissioner of Cooperatives.
The accused denied a charge of failing to retain and maintain liquid assets equivalent to 15 percent of its total savings deposits and short-term liabilities.
They also they denied a charge of failing to establish and maintain a credit committee as required by the prudential standards, thereby compromising the credit risks management framework of the Sacco.
In count seven, the officials were accused of failing to keep proper books of accounts showing a true and fair state of affairs of the Sacco’s financial position.
They further denied a charge of failing to appoint an internal auditor and failing to ensure loans advanced to members were properly secured by adequate collateral as required by law.
Those charged are Christopher Kahuno Karanja, Samuel Ndung’u Muiruri, John Kimani Munyaka, James Kamau Ngugi, Patrick K Kagwi, Francis Kamau Ng’ang’a, Benson Mwangi Ng’ang’a, Paul Kabere, Geoffrey Wamae, Duncan Chege, Francis Wachiuru Mbae,George Mwihia, Daniel Lee Kamau, Joseph Gachunga Mwaura, Boniface Muthama, Rosemary Chege, Edward Duncan, Lucy N Kabiru and James Ngomo.
They were released on a bond of Sh200,000 each, with an alternative cash bail of Sh70,000.
“Having considered the ages of the accused persons which ranges between 40-70 and their health status, this court finds they are not a flight risk,” ruled the magistrate.
The court also noted most of the accused persons are retired teachers and civil servants whose exit amounts in their public service was around Sh2 million, and therefore persons of meagre means.
The officials denied the accusations and claimed that they were being framed by the police and some government officials their bloated allegations was discounted by the Sacco Societies Regulatory Authority (Sasra), saying they were the ones culpable as they could not account for Sh14,497,677,663 within a span of nine years.
Through defense lawyers the 16 disputed the figure quoted in the charge sheet presented to a Milimani law courts senior principal magistrate claiming ,“police cooked up figures as there was no way the officials most of whom are retired primary school teachers could gulp the Sh14,497,677,664.
The accused attempted to put a vail of innocence but lawyer Gordon Ogado for Sasra drew the curtain saying- an in-depth audit and investigation was carried by sacco’s regulatory authority before the figures quoted in the charge sheet was arrived at.
SASRA is a statutory state corporation established under the Sacco Societies Act (Cap 490B) of the Laws of Kenya to regulate cooperative societies to ensure they are operated within the parameters and legal tenets to safeguard members’ contributions.
“Before the presented charge was drafted the Sasra conducted investigations then came up with a report that was handed over to the Commissioner of Cooperatives for action,” Mr Ogado stated.
He added that after a thorough analysis and study of the Sasra report, each of the 19 officials of Metropolitan National Sacco was surcharged.
The trial magistrate heard each of the officials was held accountable and a recovery process has been put in place.
“These accused persons herein are responsible for the loss of the members’ money most of whom are retired teachers,” Mr Ogado stated.
However, both Ogado and the prosecuting counsel Ms Joyce Olajo did not oppose the release of the suspects on bond saying they had been cooperating with the investigating officers.
The trial magistrate Ms Daisy Mutai was informed majority of the accused persons had serious health issues with one having an amputated limp due to a “health challenge.”
All the accused who had been out on police bonds surrendered themselves to court to plead to the charges.
“None of the accused persons was arrested to attend court but they voluntarily attended court to answer to the charges filed against them by the director of public prosecutions-DPP-,” a defense lawyer told the court.
