Nineteen former officials of Metropolitan National Sacco Limited were on Tuesday arraigned before the Milimani Law Courts in Nairobi where they denied multiple charges linked to an alleged Ksh 14.5 billion fraud scheme said to have been committed over a span of nearly ten years.
The accused persons, among them Christopher Kahuno Karanja, Samuel Ndungu Muiruri, John Kimani Munyaka and sixteen others, appeared before Principal Magistrate Daisy Mutai facing charges of conspiracy to defraud contrary to the law, alongside several counts relating to financial mismanagement and regulatory violations under the Co-operative Societies Act and the SACCO Societies Act.
According to the prosecution, the accused persons jointly conspired to defraud Metropolitan National Sacco Limited of Ksh 14,497,677,664 on diverse dates between 2012 and 2021 within the Republic of Kenya.
The prosecution further told the court that the former officials allegedly engaged in unlawful investment practices by channeling over Ksh 1.014 billion belonging to the Sacco into non-core business activities, including the purchase of land in Kitengela, Machakos County, contrary to statutory regulations governing Sacco operations.
The charges stem from long-running investigations into the collapse and financial instability of Metropolitan National Sacco, once considered one of the country’s prominent deposit-taking cooperatives.
Investigators believe the institution suffered years of systemic financial mismanagement, weak internal controls, and alleged abuse of office by senior officials.
Court documents indicate that the accused persons are also blamed for failing to maintain proper books of accounts, failing to prepare accurate financial records, and failing to retain the mandatory liquidity ratio required for deposit-taking Saccos.
The prosecution further accused the former officials of failing to establish a credit committee, neglecting to appoint an internal auditor, and issuing unsecured loans to members without sufficient collateral, actions said to have exposed the Sacco to massive financial risk and eventual collapse.
During the plea-taking session, defense lawyers mounted a spirited application for lenient bail terms, urging the court to consider the personal circumstances of the accused persons despite the magnitude of the alleged loss.
The defense submitted that the accused had cooperated fully with investigators from the Directorate of Criminal Investigations (DCI) for the last two years and had consistently honored summons whenever required.
Lawyers representing the accused further argued that the figures contained in the charge sheet were exaggerated and should not influence the court in determining bond terms.
One of the accused reportedly informed the court that he had “never imagined handling such an amount of money.”The court also heard mitigation pleas based on age, health complications, and financial hardship.
The defense informed the court that some of the accused persons are elderly and suffering from chronic illnesses, including diabetes, hypertension, and heart-related conditions.
Particular concern was raised over James M. Ngomo, aged 64, who reportedly suffers from diabetes that led to the amputation of one of his legs, while Rosemary Chege was said to be battling severe blood pressure complications.
The court also directed that Edward Duncan and James M. Ngomo be processed by the DCI.
After considering submissions from both the prosecution and the defense, Principal Magistrate Daisy Mutai granted each accused person a bond of Ksh 200,000 with an alternative cash bail of Ksh 70,000 pending hearing and determination of the case.
The matter will proceed for further directions as the prosecution prepares to present evidence in what is expected to be a lengthy and high-profile financial crime trial.
