Paraguay's Attorney General has ordered three criminal investigations into the Ueno Bank collapse, including allegations involving President Santiago Peña, who resigned Thursday as the lower house voted to impeach him.
Paraguayan President Santiago Peña is under criminal investigation following the collapse of Ueno Bank, prosecutors announced Thursday, hours after his resignation and impeachment by the lower house of Congress.
Peña announced his resignation Thursday in the interest of "the stability of our country, social peace and the need to preserve our democratic institutions." Minutes after his announcement, the lower house voted 78-0 to impeach him, sending the charges to the Senate. Congressional leaders will continue voting Friday on whether to accept Peña’s resignation, which would clear the way for Vice President Pedro Alliana to be sworn in without waiting for a Senate trial.
Paraguay’s Attorney General Emiliano Rolón Fernández has ordered three criminal investigations into the Ueno Bank crisis, including allegations involving Peña and other current and former government officials, the prosecutor’s office said Thursday. The investigations will examine authorities’ oversight of the bank, their handling of its failure and the placement of public funds in the lender.
Opposition senators are continuing to demand that Peña be removed from office, arguing that allowing him to resign would preserve his eligibility to become a senator for life, with legal protections that could prevent his prosecution, should the Attorney General opt to file charges.
Peña said he would cooperate with investigators. "Whatever the outcome of this process, I will act with responsibility and respect for the Constitution," he said on X.
Ueno Bank, which claimed more than 60% of Paraguay’s adults as customers, was seized by Paraguay’s central bank amid a solvency crisis. As of last month, Ueno reported holding roughly $800 million in public deposits, about a quarter of its total, including money from the state pension and health fund and the operators of Paraguay’s giant hydroelectric dams.
Once the books were corrected, Ueno’s capital fell to less than half the legal minimum. The central bank announced the lender’s seizure Tuesday. Ueno’s app, cards and transfers went dark and its branches locked their doors, leaving desperate depositors lined up outside.
On Thursday, a judge ordered six Ueno executives, including founder Miguel Vázquez and bank President Juan Manuel Gustale, jailed pending trial and two others placed under house arrest. Prosecutors have charged 27 bank officials and associates with breach of trust and attempted fraud.
Under a law rushed through Congress on Wednesday, a state guarantee fund must repay stranded depositors within five business days, starting Thursday with small accounts of up to about $1,600. The fund insures up to about $36,000 per customer, which the central bank says will cover the full balances of an estimated 97% of clients.
The collapse of Ueno Bank has left millions of depositors, retirees and workers scrambling to recoup their frozen savings and unpaid wages. The Labor Ministry estimates the collapse has affected about 7,000 direct and indirect jobs at the bank and its related businesses. The crisis turned Peña’s long-ruling Colorado Party against him, with Colorado Party leader and former President Horacio Cartes backing impeachment, saying the party would not side with "the plundering of public and private funds and pensioners’ money."
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
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President Santiago Peña has resigned and been impeached by Paraguay's lower house following the collapse of Ueno Bank and subsequent criminal investigations.
