Corruption

NIS Strongly Linked UNAITAS Sacco To Money Laundering Shutting Down Growth To A Bank

Since 2018, UNAITAS SACCO has been boasting to be ready to roll out commercial bank services if the Central Bank of Kenya (CBK) had lifted the moratorium on licensing imposed in 2015.

Industry players say, moratorium did not affect mergers and acquisitions and has seen some previous applicants granted a licence as it was with Mayfair Bank.

CNYAKUNDI.COM has reliably learnt that state security agencies, in a very huge report, flagged the UNAITAS SACCO management, a report that was sent to the Central Bank Of Kenya.

The huge report questioned some UNAITAS SACCO management money-laundering violations, tribalism within the institution and profiled dirty wealth acquired since they joined the struggling Sacco.

The NIS dossier seemed to discredit the Sasra clean bill of health that had been given to UNAITAS SACCO, putting the credibility of the Sacco’s regulatory authority in doubt. The SACCO had relied on the SASRA positive rating to apply for the banking license.

The Central Bank of Kenya monitoring and inspection unit also punched holes into the SACCO’s governance and management structure. Efforts by the management to get the licence flopped as CBK demanded future reforms if the license is to be issued.

Of great concern is the infighting among UNAITAS board of directors and senior staff members in management. Another CBK concern is the SACCO inside link to frequent insiders led cyber-attacks and poor services.

According to an insider, the SACCO lost a cool Sh500 million through flagged accounts, unflag and transfer funds. Sources say despite the SACCO investing in a new technology T24 banking system, the crime is still rife to date.

Other concern is the SACCO unable to control debtors and inside trading. At one time, its debtors and prepayments rose to 751 per cent within a year, a report shows. Between 2017 and 2018, the amount was from staggering Sh115 million to Sh985 million. Intangible assets by then were projected at a cool 2,632 per cent within a year.

Talk is rife within the banking industry, UNAITAS falsified its bookkeeping while applying to be a commercial bank. Reports indicate the SACCO  has perfected an act of having more than three sets of accounting books.


Of great concern are management woes and the mass exodus of managers due to directors influence. The directorial and top management structure is tribal which is against banking ethics for CBK to allow. Due to witch-hunting, senior managers have been exiting in droves with transfers being the order. One case study is that of Tony Mwangi retired after being forced by a section of directors after serving CEO for over 10 years.

The SACCO chairman Joseph Kabugu to hoodwink members all is well has been selling the issue of expecting CBK issuing a banking licence year after year raising eyebrows.


The bank headquarters at Cardinal Otunga Plaza according to Kabugu is supposed to be its first Commercial branch bank. At the head office, one community controls every department. The upgrading of the bank IT systems was single-sourced and inflated to a tune of extra sh 20 million according to sources. The chairman and his allies of directors together with current CEO and IT in charge shared the proceeds.

Mwangi was forced to quit on grounds, he was leaking information to competitors and was opposed to the SACCO going commercial way. Others say, he was a victim as he was one of the best CEOs and was against internal borrowing by directors. Internal borrowing by a faction of directors is blamed for UNAITAS current financial misfortunes.

Martin Muhoho, whose qualifications and leadership skills have been questioned is the CEO.

One area that is ailing the SACCO is over-ambition by expanding and opening new branches managed by inexperienced staff employed on nepotism and sexual favours. The CEO, chairman and a section of directors allied to the chair being major culprits.

For instance, the Kisumu branch is said to be underperforming. Other branches are Kawangware, Thika, Temple road Nairobi, Kangari branch, Gatura, Kiriaini, Kangema, Nakuru pioneer, Naivasha, Juja, Mlolongo, Ongata Rongai, Murang’a, Gatundu, Kahatia, Mununga, Githumu, Embu, Meru, Kisii, Kisumu and Eldoret.

Tribalism is rife. Mercy Njoroge is Head of SME and Microcredit at UNAITAS, Muhoho (CEO), Kabugu (chairman) with all top managers from one region. At one time the SACCO had Tony Mwangi (CEO), James Kinoro (Vice-Chairman), Rhoda Gachoka (Chairperson Business Development Committee), Gabriel Mugo (Head Audit Committee) Francis Mburu (member), Frashia Kamuri (Member) Michael Mureithi (Member) Joseph Kabugu (Board chair), Peter Kamangara (member) Erastus Mwangi (Member) revealing its tribal leaning.


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