The Government has taken over troubled Ekeza Sacco in an effort to protect thousands of investors. The sacco will be liquidated and the cash realised used to pay depositors.
The process will take one year, according to Commissioner for Co-operative Development Mary Mungai. Liquidation is the process of converting company assets into cash, for instance, by selling them, to pay a debt. Ms Mungai cancelled the sacco’s licence two weeks ago and ordered its liquidation. Assistant Director for Co-operatives Stephen Kamau and Principal Co-operative Officer Philip Ukhevi will oversee the liquidation process.
“I authorise them to take into their custody all the properties of the said society, including such books and documents as are deemed necessary for completion of the liquidation,” Mungai said through a gazette notice dated March 26. Sacco officials had said the firm had more than 50,000 members.
It reportedly gave out Sh2.6 billion in loans. Mungai had advised anyone aggrieved by the decision to close down the sacco to register their complaints with the Industry, Trade and Co-operatives Cabinet secretary. This order sets aside an earlier directive that deregistered Ekeza pending streamlining of its operations to suit sacco requirements.