The sale of property belonging to the Kenya Union of Savings and Credit Cooperative Limited has now been formally allowed by the Cooperative Tribunal, marking a serious moment for the cooperative movement in the country.
This decision clears the way for the recovery of Ksh108.8 million owed to RUPSA SACCO after years of delay, ignored requests, and failure to obey court directions. The ruling brings to an end a long dispute that began with simple withdrawal demands and ended with enforcement through auction.
The Tribunal ruled in favour of RUPSA SACCO, formerly known as PCEA Ruiru SACCO, after confirming that KUSCCO owed Ksh88.95 million as the principal amount.
After adding interest, legal costs, and related fees, the total debt rose to Ksh108.8 million. The court declined to add extra damages, noting that KUSCCO was already facing serious financial strain caused by internal mismanagement and lack of proper controls. However, the court made it clear that financial hardship could not be used as an excuse to ignore lawful obligations.
Following the ruling, auctioneers were authorised to move in and seize movable property belonging to KUSCCO if payment is not made immediately.
These assets include vehicles, office equipment, and any other items that can be recovered to settle the debt. The warrant of attachment allows action without further delay, signalling that the court had lost patience with continued non compliance.
RUPSA SACCO explained that it was forced to seek enforcement after repeated efforts to resolve the matter failed. The SACCO argued that KUSCCO ignored clear court orders while still managing to pay other creditors. The Tribunal agreed that this selective approach was unfair and could not be justified. It found that RUPSA SACCO had given enough time and space for voluntary settlement, which was not honoured.
The dispute began in 2018 when RUPSA SACCO invested fixed deposits with KUSCCO to earn stable returns for its more than 8,000 members.
By July 2023, the total amount deposited stood at Ksh88,951,375. In April 2023, RUPSA SACCO asked for Ksh60 million to be released while the rest was to be rolled over.
KUSCCO did not act on this request and cited liquidity problems. Even after the deposits matured in January 2024, the money was not refunded.
After failed talks, unanswered letters, and unfulfilled promises, RUPSA SACCO filed a case at the Cooperative Tribunal in March 2024. The court reviewed all documents and confirmed that the debt was valid and overdue. With no reasonable explanation for further delay, enforcement became the only option left.
The case has wider meaning for the SACCO sector. Records show that KUSCCO paid other SACCOs hundreds of millions of shillings during the same period, raising concerns about fairness and accountability.
Regulators have also pointed out that weak laws and delayed policy action allowed serious problems to grow unnoticed.
Reports indicate that losses linked to KUSCCO affected more than 200 SACCOs and weakened their core capital.
