Harambee SACCO bosses and shareholders set to clash at AGM

Harambee SACCO bosses and shareholders set to clash at AGM

- in Investigations, News
Sacco chairman Macloud Malonza

Harambee Sacco’s management and shareholders are set to clash on today
as the troubled savings society holds its AGM in the midst of a poor
performance and persisting internal management wrangles.

Kenya’s third largest deposit taking savings society recently blamed a
steep rise in costs for pushing it into loss-making in 2017.

The sacco reported a Sh145 million loss in the period compared to a
Sh125million after-tax profit the previous year.

Early this month trouble was brewing at Harambee after some suspended
members moved to the Cooperative Tribunal accusing directors of
planning to block their participation in board elections to challenge
the incumbents.

The nine suspended delegates sought a reversal of the suspension on
grounds that it was meant to stop them from vying for elective posts
at the annual general meeting.

The society’s management, however, denied the allegations, arguing
that the delegates were suspended for, among others, storming the
acting chief executive officer’s office and causing disturbances.

But the suspended members insisted they only visited the office of the
CEO on January 10 to seek clarification over an alleged loss of Sh2.9
million cheques.

They said they were particularly targeting the sacco secretary Charles
Konzolo and treasurer Meshack Odero Nyangute, who signed the lost
cheques.

“The sole intent of the respondent to suspend the applicants for
purported transgressions alleged to have been committed more than two
months ago smacks of malice, bad faith, spite, contempt and is mere
charade meant to shield the two impugned officials (Mr Konzolo and Mr
Nyangute) from facing competition in the yet to be announced AGM,” the
suspended members said in their application.

In March this year, a senior manager at Harambee Sacco was charged
with stealing property worth over Sh13.6 million from the firm.

Christopher Seje Bolo, who works at the Credit Control Department
however denied the charge before Principal Magistrate Martha Mutuku
and was released on a cash bail of Sh300,000 or bond of Sh1million
with a surety of the same amount.

Sacco chairman Macloud Malonza and outgoing Chief Executive Officer
Peter Ndegwa who is said to have already deserted duties and the sacco
plans to offset his dues are blamed for the downfall and mismanagement
of the institution.

The giant sacco’s deficit before tax rose to Sh1.39 billion in 2017
compared to Sh197.2 million surplus before taxation in 2016.

The sacco’s interest income rose 20.99 per cent to Sh1.88 billion,
while its loan book grew 7.68 per cent or Sh104.4 million last year to
stand at Sh14.6 billion in the period under review.

Harambee’s membership stood at about 92,000 at the end of 2017, most
of them current and former civil servants.

Harambee has several times found itself in the cross-hairs of the
saccos regulator.

In 2012, a Sacco Societies Regulatory Authority (Sasra), inspection
found that the sacco was in an acute liquidity crisis having failed to
meet nearly all prudential parameters.

The sacco had negative core capital and had material variances between
the outstanding loan portfolio reports and provisions for loan losses,
at the time.

In 2015, Barasa was sent on compulsory leave while interim audit of
controversial expenditures and inconsistent questionable figures of
Front Office Savings Activities (FOSA) loan totaling to Sh3billion was
underway.

He was temporarily forced out just three days to the deadline of
submitting reconciled FOSA loan report to Sasra.

The audit targeted three lines of alleged cash fleecing conduit of
imprests, I Owe You, summary balance sheet detailing bank records of
loans paid up in cash and marketing vote.

The sacco management had committed to avail reconciled financial
records particularly explaining inconsistent figures of Sh3billion
FOSA loan.

In the past, the sacco has been bedeviled by controversies of massive
financial scams and unresolved murders of senior officials.

Barasa served as the principal deputy of the former Finance Manager
the late Benson Ojiambo who was murdered at point blank range by a
lone gunman in Embakasi, Tassia Estate along Outering Road on October
29, 2012.

A week prior to his death, Ojiambo was set to appear before the
Agriculture, Co-operatives parliamentary committee for questioning
over the alleged financial scams massive fraud cover-ups as revealed
in a confidential report by Sasra in 2012.

Ojiambo was in charge of reconciling collections from the cashiers and
ATM withdrawals with the computer entries and had prepared to present
a report on the ATM scheme to the parliamentary committee.

Ordinarily, saccos are allowed to borrow a maximum borrowing of 25 per
cent of the total value of assets upon an AGM authorisation through a
resolution by all members.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may also like

Ruto holds private meeting with Governor Ojaamong

Deputy President William Ruto on Friday held a