Nineteen suspects linked to an alleged Sh14 billion Sacco fraud scheme have been arraigned at the Milimani Law Courts following investigations by the Directorate of Criminal Investigations.
The suspects, said to be former and current officials of a Sacco, were charged over what investigators described as a sophisticated financial fraud involving fictitious loans, manipulation of records and diversion of members’ funds.
According to the DCI, the investigations began after the Sacco Societies Regulatory Authority filed a formal complaint requesting a probe into allegations of embezzlement and financial misconduct within the institution.
Detectives attached to the DCI headquarters Investigations Bureau launched inquiries that later uncovered what the agency termed as a coordinated scheme carried out over several years.
“The investigations established that the officials acted in concert while blatantly violating their fiduciary duties,” the DCI said.
Investigators said the suspects allegedly manipulated financial records, irregularly transferred members’ funds and unlawfully disbursed loans while failing to account for huge sums entrusted to them.
The DCI said detectives uncovered two interconnected fraudulent schemes during the investigations.
The first involved alleged manipulation of loan disbursement records between 2012 and 2021, resulting in fictitious loans amounting to more than Sh13.4 billion.
The second scheme allegedly involved the formation and operation of an investment cooperative society used as a vehicle to divert Sacco funds under the guise of land acquisition and investment opportunities in Kitengela.
According to the DCI, more than Sh750 million is believed to have been misappropriated through the investment scheme.
The suspects now face multiple charges, including conspiracy to defraud, stealing by directors or officers, fraudulent false accounting, obtaining credit by false pretences and failure to maintain proper books of accounts.
Others were charged with operating non-core investment businesses without statutory approval.
All the accused persons pleaded not guilty when they appeared before on Tuesday.
“The court granted each suspect a bond of Sh200,000 with one surety ahead of the next mention scheduled for June 22, 2026,” DCI stated.
The DCI said the case highlights growing concerns over financial crimes targeting savings and cooperative institutions that millions of Kenyans depend on for financial stability.
“The DCI remains steadfast in its commitment to dismantling complex financial crime networks and protecting millions of hardworking Kenyans who rely on Saccos as pillars of economic empowerment and financial security,” the agency said.
The investigative agency warned Sacco officials against abuse of office and misuse of members’ savings, saying those found engaging in fraudulent activities would face the full force of the law.
The DCI also urged members of the public to remain vigilant and report suspicious financial dealings within cooperative societies and other financial institutions.
Investigators further advised Sacco members to actively monitor the management of their savings and demand transparency and accountability from officials entrusted with handling their funds.
The agency said financial fraud within cooperative societies not only affects individual savers but also undermines confidence in institutions that play a critical role in Kenya’s economy.
Kenya’s Sacco sector handles billions of shillings in savings and credit facilities and remains one of the country’s largest drivers of financial inclusion, especially among low and middle-income earners.
The DCI encouraged whistleblowers and members of the public with information on financial crimes to report anonymously through its toll-free hotline and WhatsApp reporting channels.
