Ekeza, sacco regulator reach out-of-court deal

The deal sees the society withdraw a lawsuit against the watchdog.

COMMISSIONER OF CO-OPERATIVES MARY MUNGAI. PHOTO | DIANA NGILA | NMG 

IN SUMMARY

  • In consequence, it has withdrawn a suit in which it had challenged the action by the regulator which accused the sacco of failure to comply with the law.
  • The sacco, which has deposits in excess of Sh2.56 billion, had argued that its deregistration was in bad faith.
  • But when the suit came up on May 4 for ruling, Ekeza sought court orders to temporary suspend the decision.
  • Lawyers representing the two parties told the court that they had reached an agreement and requested to be allowed to withdraw the suit.

Advertisement

Ekeza Savings and Credit Cooperative Society says it has reached an agreement with the Commissioner for Co-operative Development to settle a case arising from its deregistration.

In consequence, it has withdrawn a suit in which it had challenged the action by the regulator which accused the sacco of failure to comply with the law.

The sacco, which has deposits in excess of Sh2.56 billion, had argued that its deregistration was in bad faith.

READ: Regulator seeks time to respond in Ekeza Sacco suit

But when the suit came up on May 4 for ruling, Ekeza sought court orders to temporary suspend the decision.

Lawyers representing the two parties told the court that they had reached an agreement and requested to be allowed to withdraw the suit.

“The parties have been in negotiations and have reached an agreement. The applicant therefore wishes to withdraw its application dated April 10,” Justice Pauline Nyamweya was informed.

The lawyers did not disclose details of the agreement or whether Ekeza will now be allowed to continue with normal operations.

The judge allowed the withdrawal of the suit, noting that although the ruling was ready there was no need to deliver it since the parties had reached an agreement. Commissioner for Co-operative Development Mary Mungai cancelled the registration of the sacco, through a gazette notice published on March 23, stating that it had failed to meet its objectives and ordered it to close down all its 26 offices across the country.

Ms Mungai urged those aggrieved by the cancellation of its licence to appeal to the Cabinet secretary within 60 days.

The sacco was also operating a housing scheme under Gakuyo Real Estate Company which required prospective home buyers to deposit a minimum of Sh10,000 as booking fee and further savings to acquire houses.

Thousands of scheme members are yet to get the homes.

READ: Investors risk Sh2.6bn as Ekeza Sacco shut

More From Business Daily
This page might use cookies if your analytics vendor requires them. Accept