ADVERT 
Nineteen former and current Sacco officials were on Tuesday arraigned at the Milimani Law Courts over an alleged Sh14 billion fraud scheme in what investigators describe as one of the largest financial scandals ever to hit Kenya’s cooperative movement.
The suspects, accused of orchestrating a sophisticated web of embezzlement, false accounting and illegal fund transfers over nearly a decade, pleaded not guilty to multiple charges linked to the massive loss of members’ savings.
The case emerged after the Sacco Societies Regulatory Authority formally requested investigations by the Directorate of Criminal Investigations following alarming reports of financial irregularities within the Sacco.
According to investigators, the probe uncovered a deeply entrenched scheme allegedly executed by senior Sacco officials acting in concert to siphon billions from unsuspecting members while concealing the transactions through manipulated financial records.
Detectives say the fraud operated through two elaborate schemes.
The first involved systematic manipulation of loan disbursement records between 2012 and 2021, where fictitious and irregular loans amounting to a staggering Sh13.48 billion were allegedly created and concealed in the Sacco’s books.
The second scheme revolved around the creation of an Investment Cooperative Society Limited, which investigators believe was used as a vehicle to divert Sacco funds disguised as land purchases and investment ventures in Kitengela. Authorities claim at least Sh750.7 million was misappropriated through the arrangement.
Those charged include Christopher Kahuno, Samuel Ndungu, John Kimani, James Kamau, Patrick Kimando, Francis Kamau, Benson Mwangi, Paul Wathika, Geoffrey Kamau, Duncan Chege, Francis Wachiuru, George Mwihia, Daniel Lee, Joseph Gachunga, Boniface Muthama, Rosemary Njeri, Edward Duncan, Lucy Njambi and James Mutaiga.
Prosecutors slapped the suspects with an array of charges, including conspiracy to defraud, stealing by directors or officers of a company, fraudulent false accounting, obtaining credit by false pretences, failure to maintain proper books of account and operating non-core investment businesses without statutory approval.
The court granted each accused person a bond of Sh200,000 with one surety pending further hearings. The matter will be mentioned on June 22, 2026.
The scandal has once again thrown Kenya’s Sacco sector under intense scrutiny, raising fresh concerns over governance failures, weak internal controls and the vulnerability of millions of depositors who rely on cooperative societies for savings and credit facilities.
For years, Saccos have been regarded as financial lifelines for ordinary Kenyans, especially salaried workers and small-scale entrepreneurs. However, recurring cases of mismanagement, insider fraud and questionable investment schemes have increasingly shaken public confidence in the sector.
The DCI says investigations into the multi-billion-shilling scandal remain active and warned that more arrests could follow as detectives continue tracing the movement of funds and assets linked to the accused.
In a strongly worded statement, the agency reaffirmed its commitment to dismantling complex financial crime networks and safeguarding Kenyans from economic exploitation.
The case is expected to draw national attention as prosecutors seek to unravel how billions of shillings allegedly disappeared from an institution entrusted with members’ savings over nearly ten years.
