A Christian-based SACCO is set to auction the movable assets of the Kenya Union of Savings and Credit Cooperative (KUSCCO) to recover KSh108.8 million in unpaid deposits, escalating a dispute over funds that matured more than two years ago.
- •The move follows KUSCCO’s failure to comply with a 2025 Co-operative Tribunal judgment that ordered the umbrella SACCO body to refund RUPSA Sacco its principal investment, accrued interest, costs and post-judgment interest.
- •KUSCCO has reported paying other member SACCOs a cumulative KSh 369.3 million over the two years to December 2025, funded through asset sales and loan recoveries.
- •RUPSA argued that these disclosures undermine claims of inability to pay and raise questions about unequal treatment of creditors.
“Our only objective is recovery of our members’ funds. After exhausting diplomatic engagement, we sought redress from the Tribunal and obtained a favorable judgment. Given the legal implications of the matter, we expected the outstanding debt to be accorded appropriate priority by KUSCCO,” said Julius Mbugua Mwangi, RUPSA SACCO’s Acting CEO.
With no payment forthcoming, RUPSA returned to the Tribunal seeking enforcement. On January 19, 2026, the Tribunal granted execution orders permitting auctioneers to attach KUSCCO’s movable assets including vehicles, office equipment and furniture to recover the outstanding amount, now standing at KSh108.8 million after interest, costs and collection fees.
The dispute began when RUPSA, formerly PCEA Ruiru SACCO, placed fixed-deposit investments with KUSCCO beginning in 2018. By July 2023, RUPSA had deposited KSh88.95 million. Instructions issued in April 2023 to withdraw KSh60 million and roll over the balance were not honored, with KUSCCO citing liquidity pressures. When the remaining deposits matured in January 2024, the funds were still not refunded despite multiple demand notices.
RUPSA filed suit at the Co-operative Tribunal in March 2024. In a judgment delivered in April 2025, the Tribunal confirmed that the deposits and interest (amounting at the time to KSh95.04 million) were due and payable, entering judgment in RUPSA’s favor. The Tribunal ordered repayment of the full amount with interest and costs.
However, the ruling drew a sharp distinction between repayment and liability for damages. While affirming the debt, the Tribunal declined to award damages for breach of contract, accepting KUSCCO’s argument that its failure to pay arose from severe liquidity problems, regulatory intervention, and board restructuring rather than bad faith. The Tribunal held that these circumstances frustrated performance of the contract, shielding KUSCCO from additional liability.
KUSCCO collapsed after years of financial mismanagement, weak oversight and alleged fraud left it deeply insolvent and unable to repay billions of shillings placed by member SACCOs. A forensic audit by PwC triggered the removal of its board and management, regulatory intervention, and court actions by creditor SACCOs whose financial operations were hit by the losses.
Some of the umbrella body's executives including then managing director George Ototo, finance manager George Owino and Chairman George Magutu remain charged in court over conspiracy to defraud, theft, and money laundering.
