In a bid to strengthen the financial sector and ensure the protection of members’ investments, the Deputy President of the Council of Governors, Hon. Wycliffe Oparanya, has announced a sweeping shake-up of the Savings and Credit Cooperative (Sacco) sector aimed at curbing rampant fraud within the system. This move is part of a broader effort by the government to foster transparency, accountability, and sustainability in cooperatives across the country.
Speaking at a high-level forum on Sacco reforms, Oparanya emphasized that the government was committed to rooting out fraudulent activities that have been eroding the trust of Sacco members. We cannot afford to let fraudsters continue exploiting hardworking Kenyans who have invested their hard-earned money into these institutions. The time has come for a major reform within the Sacco sector to ensure that it operates with the highest level of integrity, said Oparanya.
He outlined several key initiatives that will be rolled out as part of the reform agenda. One of the primary measures is the establishment of a specialized fraud detection unit within the Sacco regulatory bodies. This unit will work closely with law enforcement agencies to investigate and take action against individuals or groups engaged in fraudulent activities. Additionally, the government plans to introduce new digital tools that will enhance monitoring and surveillance, making it easier to track suspicious financial activities.
Oparanya also pointed to the need for better governance structures within Sacco institutions, stressing that many of the fraud cases stemmed from poor oversight and weak internal controls. He urged Sacco managers and boards of directors to adhere strictly to corporate governance best practices and ensure that their operations are transparent and efficient.
Another significant aspect of the reform will be the strengthening of member education. According to Oparanya, many Sacco members fall victim to fraud due to a lack of financial literacy and understanding of their rights within these cooperatives. We need to empower our members with the knowledge and tools to detect and report fraud. Financial education is key to ensuring the future success of these institutions, he said.
