Savings and credit cooperative societies (Saccos) have agreed to develop an anti-fraud unit with the Directorate of Criminal Investigations.
The move, regulators say, will safeguard the sector’s over Sh800 billion in customer deposits.
The agreement establishes the Sacco Societies Fraud Investigation Unit (SSFIU), which will detect and investigate crimes involving member money embezzlement and cyber-attacks.
Fraud is the sector’s second most pressing worry, with members losing millions of shillings in recent months, putting the spotlight on efforts to combat the vice.
At 9.64 percent, suspected fraud is the third most common source of complaints from deposit-taking Sacco members.
Complaints about guarantors and loan guarantees account for 12.05 percent of all complaints, while loan issuance accounts for 22.29 percent, and claims and refunds of deposits account for 36.75 percent.
The vice is the second-most common source of complaint in non-deposit talking Saccos, accounting for 6.67 percent of all complaints after refunds and savings claims.
According to data from the Central Bank of Kenya and Sasra, Saccos lost Sh106 million to cyber theft in the 17 months leading up to March.
President Uhuru Kenyatta authorized the State Department of Cooperatives to build an investigative fraud team two years ago, and the unit is already operational.