The SACCO Societies Regulatory Authority (SASRA) has signed a Memorandum of Understanding (MOU) with the Directorate of Criminal Investigations (DCI) to establish the SACCO Societies Fraud Investigation Unit (SSFIU).
The new agreement will push the realization of the Authority’s reform agenda of entrenching corporate governance practices among SACCOs. It is also a fulfilment of President Uhuru Kenyatta’s directive issued in July 2019 to establish the Unit.
In March 2020, DCI seconded three highly skilled financial fraud officers to SASRA to lay the groundwork for the operationalization of the Unit. The SSFIU has already started working with trained officers from both the DCI and SASRA.
The unit has already started receiving and investigating information from individuals and organizations to prosecute SACCO Society officials implicated in financial and cyber-related fraud cases.
DCI has seconded two more investigative officers to the Unit to improve its capacity to follow up cases efficiently and expeditiously. The unit now has five investigative officers from DCI.
Speaking during the MOU signing ceremony, SASRA Chairman John Munuve said, “We view this MOU as an important and serious commitment to work closely with DCI in transforming the SACCO subsector. The establishment and operationalization of the Fraud Investigations Unit, came at the most opportune time, to complete the cog of the supervisory framework of SACCOs in Kenya, which was initially largely reliant on prudential supervision.”
He added that the formed Unit will collaborate with the Authority to develop and implement robust market surveillance and monitoring mechanisms to combat fraud. He also noted that the proactive actions will be crucial in stopping the loss of members’ funds, instead of waiting to pursue the culprits after the losses.
On his part, DCI representative John Gachomo said, “It is important to stress that in today’s economy, financial transactions are heavily conducted using technology and other digital services. And SACCOs have not been left behind in this. I do want to call out stakeholders within the SACCO subsector to fully embrace the newly created Unit as a lever to the transformation of the SACCO movement in Kenya.”
The unit will be domiciled at SASRA and is expected to detect and prevent fraud as part of improved corporate governance in the SACCO sector in line with SASRA’s Strategic Plan for 2018-2022.