The alleged fraud was uncovered during a sample audit of PDM SACCOs. A probe initiated by the Resident District Commissioner (RDC) found that at least Shs29 million had been fraudulently obtained through multiple disbursements and identity theft in Chemwania PDM SACCO.
According to the RDC, Hope Atuhairwe, the scheme involved SACCO leaders allegedly colluding with ineligible individuals to manipulate beneficiary registers and mobile money records.
"This money was meant for the poorest households, but some officials connived with people who were not eligible. Others received the money several times while genuine beneficiaries remained excluded," Atuhairwe said.
Among those under investigation is Moses Labu, an agricultural extension worker in Kaser Sub-county, who allegedly received PDM funds on three occasions despite being a civil servant, making him ineligible under the programme.
"Just because his wife is the treasurer and people know him as a civil servant, they went ahead and gave him PDM money," Atuhairwe alleged.
She further alleged that Labu used the identity of Rona Chelimo to obtain an additional Shs1 million. Although the loan was processed using Chelimo's name and National Identification Number, investigators say the mobile phone number that received the money belonged to Labu.
The investigation also implicated the chairperson of Chemwania PDM SACCO, who is accused of obtaining another Shs1 million using the identity of Violet Chelangat, with the funds allegedly disbursed to his own mobile phone number.
Authorities say the pattern points to a coordinated identity fraud scheme in which the same individuals repeatedly obtained PDM funds using different people's identities.
"Altogether, Shs29 million has been taken through this fraud," Atuhairwe said.
She said she had directed the district PDM focal person to produce complete payment records to establish the full extent of the fraud and identify all the illegal beneficiaries.
"I directed the PDM focal person to produce complete payment records to establish the full extent of the fraud and identify illegal beneficiaries," she said.
Atuhairwe added that police had opened criminal investigations into the matter, noting that some suspects had already been arraigned in court and released on bail as investigations and recovery efforts continue.
District authorities have also intensified community sensitisation after discovering that some intended beneficiaries had been discouraged from applying for PDM loans by misinformation claiming that government would confiscate their property if they failed to repay the funds.
The district says its immediate priority is to recover the stolen money, prosecute those responsible and restore public confidence in the Parish Development Model so that the funds reach the households they were intended to uplift.