• The Senate seeks to save Musco Towers in Eldoret town now targeted for auction to recover Sh500 million owed to Cooperative Bank.
• Co-op Bank accused of failure to do due diligence before lending money to the troubled 3,000-member sacco.
Image: MATHEWS NDANYI
A Senate committee suspects foul play in the liquidation of the once vibrant Moi University Savings Credit Cooperative Society (Musco).
The Committee on Trade and Tourism on Wednesday said there was a well-orchestrated scheme and collusion to swindle members of the sacco to the last coin.
“There is something fishy about Commissioner of Cooperative Development, Sasra, Cooperative Bank and former managers of the sacco. The former managers are now the most senior staff at Moi University and Eldoret University,” Wajir Senator Abdullahi Ali noted.
The committee wants a joint session with the Commissioner for Cooperative Development, Cooperative Bank, the Sacco Societies Regulatory Authority (Sasra) and former Musco managers.
Ali said the committee will meet next week to issue the summonses and apply to the clerk for a physical meeting.
“The sacco has gone down but we cannot allow members to lose the little money they have left,” he said.
Nominated Senator Getrude Inimah said the Co-op Bank could have done due diligence before lending money to a troubled sacco. Her sentiment was supported by her ODM counterpart Agnes Zani.
The bank, in its submissions to the committee, said it has legal rights “conferred by law including, but not limited, to selling the property in order to redeem the outstanding liabilities”.
It said it had graciously and generously accommodated the sacco by restructuring the outstanding liabilities and forestalling any recoveries to grant the sacco time pay the loan .
“It is evident that the sacco is unwilling to repay its outstanding liabilities despite the bank extending generous restructures of the existing credit facilities,” the bank said.
The Senate has been discussing how to save Musco Towers in Eldoret town from auctioneers. Musco owes Co-op Bank Sh500 million.
More than 3,000 sacco members sought the intervention of the Senate after failing to stop the intended auction of the building.
Ali said the committee does not have powers to stop the auctioning of a building by the bank to recover the loan. “All we can do is just hope that the bank will not continue with the liquidation.”
The government in 2018 revoked the licence of Musco and placed it under liquidation. A gazette notice published last year by then Commissioner for Co-operative Development Mary Mungai cancelled the registration of the deposit-taking sacco and appointed two liquidators to take custody for a year.
Musco was established in 1988 by Moi University staff to empower themselves economically. It drew membership from Moi Teaching and Referral Hospital and Masinde Muliro, Maasai Mara and Kabianga universities.
- mwaniki fm