Hoima District chairman Uthuman Mugisha has demanded answers on how Shs60 million Emyooga fund was disbursed to Bugahya constituency performing artists and youth leaders.
The beneficiaries of the two Saccos, Mr Mugisha said in a June 24 letter, remain unknown.
"I have got the report of Shs60m that was given out to Kabale and Buraru Emyooga associations, but when we call the names of people whose contacts were provided in the report these people say they made efforts to get money but failed," Mugisha said.
The letter, addressed to the Resident District Commissioner and Police, says a report shows the intended beneficiaries received the money.
"I have directed the RDC to instruct police to investigate the matter," he added.
The letter is copied to the Inspectorate of Government and the State House Anti-Corruption Unit.
Mugisha said he has checked out Emyooga reports and that some of the alleged beneficiaries, when called, say they are in Arua, Mbale and such far-flung places while those in the district say they were tossed up and down until they gave up on Emyooga funds.
"There is a lot of ghost beneficiaries in Hoima, there is where it indicates Shs39.8 million given to a Sacco, but the numbers don't match," he said.
"But even the leaders on the list claim they have never gotten the money, now then who took the money?"
Kaahwa Elikanjeru, a resident of Butema Kibura who deals in groundnuts produce, says their group tried getting funds but that they were told their group of 20 members could only get Shs1 to share.
They gave up.
Johnson Kiiza, a resident of Butema, said the situation when a group is to receive Shs1 million, they are instead given Shs860,000 with the rest of the money going to officials in the technical chain.
Mr Rodgers Mbabazi, the Hoima RDC, has threatened to arrest all Sacco leaders found to be fattening on the funds.
"We can't condone such kind of habit, the Emyooga funds had guidelines are clear. Why do you have to give less money to beneficiaries?" he fumed.
The RDC said such leaders are failing government efforts of getting people out of poverty.
"I want to warn all those doing it that investigations are on and culprits will be arrested," Mbabazi added.