• 'From the presentations, the liquidators bought a new water pump at Sh400,000 and then later repaired two other water pumps at Sh912,000. How is this possible?'
• Senator Ali said the liquidators could just have bought two new pumps instead of repairing the broken ones.
Image: MATHEWS NDANYI
Liquidators of Moi University Sacco were put on the spot for allegedly buying a water pump at an inflated cost and later repairing it for the same amount.
The Senate Committee on Trade asked why the liquidators had incurred very high electricity expenditure at Musco Towers, a building owned by the Sacco in Eldoret town.
“From the presentations, the liquidators bought a new water pump at Sh400,000 and then later repaired two other water pumps at Sh912,000. How is this possible?” Wajir Senator Abdullahi Ali asked.
Ali said the liquidators could just have bought two new pumps instead of repairing the broken ones. The committee raised queries on various other expenditures.
“What are these accountability fees, professional fees and survey fees that gobbled up millions of shillings?” Ali asked.
Tana River Senator Juma Wario said it was unbelievable that the cost of a commodity could be equal to the charges of repairing it.
The Commissioner of Cooperatives Didacus Ityeng could not provide the committee with answers and instead referred the matter to one of the liquidators, Hezron Kinyua.
Kinyua said they were faced with difficulties when they came in as there was no handover.
“The last audited accounts were of 2016 and we came in two years later. We had an uphill task of verifying membership, getting the files and accounts and that is why we hired professionals to help us do it,” Kinyua said.
He added that MUSCO Towers had problems with electricity which they had to fix. “We had to do the wiring for the whole building and install metres for every tenant."
Kinyua said the water pump repairs were done before they procured two new gadgets.
The Commissioner of Cooperatives noted that rent collected from the 11-storey building amounts to Sh1.4 million a month.
The Senate is seeking to save Musco Towers which is being targeted for auction to recover Sh500 million owed to Cooperative Bank.
More than 3,000 Sacco members sought the intervention of the Senate after failing to stop the intended auction.
The government in 2018 revoked the licence of Musco and placed it under liquidation. A gazette notice published last year by the Commissioner for Co-operative Development Mary Mungai cancelled the registration of the 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 draws membership from Moi Teaching and Referral Hospital and Masinde Muliro, Maasai Mara and Kabianga universities.
Edited by R.Wamochie