In the wake of rising financial fraud cases in Kenya, a significant number of Kenyans reportedly lost money through Savings and Credit Cooperative Organisations (SACCOs) in 2024.
A FinAccess report published by the Kenya National Bureau of Statistics (KNBS) identified internal fraud within SACCOs as the leading cause of financial losses, accounting for 71 per cent of the cases.
The report also revealed that accidental mobile money transfers were another major cause, with 70 per cent of Kenyans reporting losses after mistakenly sending funds to both known and unknown individuals.
Additionally, 19 per cent of mobile money users disclosed they were victims of internal fraud by service providers, while 15 per cent claimed to have lost money during reversals.
Internal fraud at pension schemes emerged as a significant concern, with 66 per cent of Kenyans relying on these schemes reporting they had been defrauded. Pension schemes serve as long-term savings plans where workers save for their retirement but have become targets for fraudulent activities.
Banking institutions were also flagged, with 56 per cent of respondents indicating they had lost money through internal bank fraud, including agents’ fraud and erroneous reversals.
Micro Finance Institutions (MFIs) were not spared, as 46 per cent of Kenyans surveyed reported losing money due to internal fraud within these institutions.
Meanwhile, 37 per cent of Kenyans who rely on mobile banking services stated they had experienced losses, attributing the losses to internal factors within the platforms.
The surge in financial fraud follows a report by Interpol, published just two weeks earlier, which highlighted cybercrime activities leading to losses amounting to Ksh1.1 billion in 2024.
According to Interpol, investigations conducted between September 2 and October 24 unearthed fraudulent scripts used by hackers to bypass banking systems’ security protocols. The stolen funds were reportedly funneled into companies based in the United Arab Emirates (UAE), Nigeria, and China, as well as digital asset institutions offering trading and financial services.
