A Tale of Sacco’s and Societies Looting from Poor and Unsuspecting Kenyans
After President Uhuru Kenyatta signed into law the Banking Amendment Act of 2015 which among other things capped the interest rates from the commercial banks in Kenya, many lenders were shaken off balance and some customers shunned away from taking loans from them despite the low interest rates.
As the saying goes, one man’s meat is another man’s poison, the poison of commercial banks was the meat of Sacco’s. Many people joined Sacco’s in terms of investments and undertaking of the loans. People embraced Sacco’s because Sacco’s have a much lower interest rates as compared to commercial banks.
The coming up of many Sacco’s has been both a blessing and a curse. A blessing because most Kenyans go a place they could invest and get loans at low interest rates. It has become a curse because some of the societies have turned into dens of criminals, looting and stealing from poor and unsuspecting Kenyans.
According to Africa Centre for Human and Civil Rights, there are some Sacco’s and societies in the country that have become fraudulent and have continued to con innocent Kenyans. According to a report by a task force headed by Mr. Francis Nyenze, the minority leader in the National Assembly, 248,784 Kenyans investors have lost over Sh8 billion to 270 fraudulent schemes in the last 5 years.
According to the report, more than 270 Sacco’s and societies are involved in this scan of defrauding Kenyans but what is of concern is that no single individual of the individuals running these companies has been brought to book and charged in a court of law.
The government is yet to implement the 2008 Sacco Societies Act which among other things was set to cushion Kenyans against unscrupulous conmen who are masquerading as Sacco’s and societies.
The Africa Centre for Human and Civil Rights has singled out two Sacco’s that they alleged are swindling millions from their unsuspecting Kenyans. These Sacco’s are Gakuyo Real Estate and Ekeza Sacco. Gakuyo for instance, according to Africa Centre for Human and Civil Rights, runs an account called Gakuyo Zero Deposit Account where unsuspecting customers deposit 20,000 shillings and promised 2 or 3-bedroom house in a project that does not exist. It is said that over 7000 people have deposited to the account.
Ekeza on the other hand has Ekeza Individual Account which now has over 70,000 members and people are told that after depositing for six months, one can get a loan that is 3 times the amount deposited without any security. Seriously? Is this even possible? Are Kenyans being conned in broad daylight? What should be done to stop this? It is time that the government acted on this issue.