How Catholic sacco siphoned Sh500million through fraudulent transactions
A Catholic Church sacco is on the spot over mismanagement and loss of about Sh500 million through unsecured loans and fraudulent transactions.
The 22,219-member sacco is said to have been run down by some of the former and current leaders, including some priests of St Francis of Assisi Ruiru Catholic Church Self Help Group in Ruiru, Kiambu county.
The Informer has learnt that the accusations against the management include officials fraudulently advancing loans to themselves and failing to recover unpaid loans as well as breach of sacco laws by issuing unsecure credits where money has been dished out to people who do not have shares.
In a recent report published in a booklet for Annual Delegates Meeting that was held on April 29, Caritas raised concerns that non-performing loans had hit an alarming level.
According to the audit report, the sacco lost another Sh8 million of “short-term savings” in the last one year.
This is after the management was unable to explain the variances from Sh523,441 in 2020 to Sh7.5 million as at December 2021.
“This had made it impossible to recover loans from former board members,” stated the audit report.
Account books indicate that the sacco has a share capital of Sh1.2 billion and a loan book of Sh1 billion.
Part of loan issued, Sh413 million has been classified as “loss” since borrowers have not been servicing them.
Further, Sh85 million savings have been defrauded by staff, which the management has acknowledged.
On October 24, 2018, a Catholic Church in Ruiru with a share deposit of Sh3.3 million, was on given Sh15 million (nearly five times its deposit) payable in 60 months, but the payments were done until March 18, 2020 and by December 2021.
The balance was Sh12.1 million with an accrued interest of Sh3.6 million.
On March 27, 2019 a second loan of Sh15 million payable in 60 months was advanced to the same church, but instalments were made up to March 18, 2020 and as December last year, it owed Sh10.8 million and a further interest of Sh3.2 million.
