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Businessmen fear Sacco swindled them millions of shillings

BUSINESS
By Michael Ollinga | August 28th 2015

Businessmen have expressed concern that a savings and credit co-operative society (Sacco) they had invested millions of shillings in has conned them.

The businessmen including real estate dealers, market wholesalers and members of self-help groups say the Sacco has stopped giving them monthly interests as agreed and refused to allow them terminate their membership and give refunds. The Sacco, which was formed in 2012 and launched a bigger branch in Eldoret on February 19 this year, has about 7,000 members.

“We diverted our savings here after the proprietor assured us we would earn interest of eight per cent every month if we deposit a particular amount. This went well since April last year but there was an immediate stop in February this year,” said John Kimani, a member of the Sacco.

Mr Kimani, who was among members who gathered outside the Sacco’s premises in Eldoret, said efforts to find out why the organisation had flouted agreed contractual terms and to get a refund have not borne fruit.

“I convinced my Witethio Uteithio self-help group members to join the Sacco because as explained during the launch, the investment was profitable. I am currently having sleepless nights since February because our request to get back the members’ money back has not been granted,” he said.

John Njuguna, an entrepreneur in Eldoret, said he has been in and out of hospital after he learnt that he cannot get interest amounting to millions of shillings and even worse he cannot get his money back.

“I cannot settle knowing that all the money I have been working for since I was young is in this Sacco. I have been asked by the doctor to relax to avoid high blood pressure but it is difficult, so I have to use drugs,” Njuguna said.

Dorcas Nyambura, a wholesaler in Eldoret had tears welling up in her eyes as she struggled to express her regrets on joining the Sacco. She even convinced her mother who lives in Elburgon to come on board.

Government intervention

“We saw this Sacco launch on February 19 in the presence of the governor, county commissioner and other leaders and we put lots of money in it. They said they would be giving us eight per cent interest on our deposits but stopped after two months. There are hundreds of our millions here and I don’t know what to tell my mother,” Ms Nyambura said.

The businessmen want the government to intervene and ascertain whether the institution is compliant with all the financial regulations and at least help them get their money back.

On Tuesday, the Sacco’s Nairobi offices remained closed, sending shock waves among members who had thronged the premises seeking refunds.

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