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Regulator now ordered to probe UN Sacco directors

By Kamau Muthoni | March 6th 2017
High Court judge George Odunga.

The High Court has ordered Sacco Societies Regulatory Authority (SASRA) to investigate mismanagement allegations against United Nations’ staff Sacco directors.

High Court judge George Odunga directed the authority to address grievances raised by the Sacco members within 30 days.

The judge, however, noted in his ruling that SASRA had not declined to address the issues raised by the members as they had alleged in their application.

“In my view, in the circumstances of this case, this court cannot agree with the applicants that SASRA had declined to address their concerns in order for this court to issue an order compelling it to do so. That, however, does not mean that SASRA is not under a statutory obligation to do so,” said Justice Odunga.

The court heard that the disgruntled members wrote to SASRA on May 3 last year followed by another complaint on May 16, but failed to get a response.

In their complaint, they had identified various irregularities in the Sacco’s accounts and further alleged that the board of directors together with the management had opened a UNSACCO branch at Gigiri Square without their approval.

Court papers show long-running bad blood between the Sacco members and the management.

UNSACCO directors are accused of awarding themselves excessive allowances without the approval of the members.

The members have also accused the directors of intimidation and threats. Justice Odunga also heard that the Sacco had not had a Chief Executive since the previous one left.


The members also accused the regulator of ignoring the alleged illegal actions.

“The applicants’ complaint was that despite lodging their complaints to the Sacco Societies Regulatory Authority and the Commissioner of Co-operatives there was no avail,” said Justice Odunga.

The court heard that it was impossible to tell the number of members UNSACCO had; either active, dormant or deceased.

This, the Sacco members said in their application, made it difficult to meet the two-thirds requirement to convene a special General Meeting.

In reply, SASRA insisted it had consistently performed its statutory mandate of supervision and regulation of the Sacco and denied the accusation that it had failed to discharge its mandate as purported by the members.

The court heard that current members of the board had hardly been in office for three months when the accusations were levelled against them and that there was no good reason why the members would seek that they be removed from office.

The directors also denied the allegations, saying no particular allegation had been brought against them.

The court heard the allegations were a calculated move to cause fear, uncertainty, capital flight and that they might have led to the collapse of the Sacco, which has been in existence for the past four decades.

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