Santiago Peña was removed by the Senate and placed under house arrest as prosecutors investigate the collapse of Ueno Bank. Vice President Pedro Alliana was sworn in to complete the term through August 2028.
Paraguay's former President Santiago Peña appeared before prosecutors on Saturday after being impeached and placed under house arrest amid a political and financial crisis triggered by the collapse of digital lender Ueno.
The Senate voted to remove Peña from office over misconduct in connection with the collapse of Ueno Bank. The vote cleared the way for Vice President Pedro Alliana to succeed him. Alliana, a longtime ruling Colorado Party politician, was sworn in on Friday to complete Peña's term through August 2028.
Peña had resigned on Thursday, but the Senate proceeded with impeachment instead of accepting his resignation. The move stripped him of the lifetime Senate seat and immunity granted to former presidents, leaving him vulnerable to prosecution.
Prosecutors ordered the arrest of Peña and former central bank chief Carlos Carvallo as part of a criminal investigation. Peña was placed under house arrest pending a decision by the public prosecutor's office on the final charges against him. Prosecutors said charges could include influence peddling.
Lawmakers who backed the impeachment accused Peña of conflicts of interest, manipulating regulatory oversight and participating in an institutional cover-up involving the central bank. Peña has denied wrongdoing and said the bank's problems were a regulatory matter.
Ueno served about 2.94 million customers. The central bank ordered a resolution or closure process after finding that Ueno's solvency ratio had fallen below half the required minimum. The bank's app, card payments and transfers stopped working, while branches closed, leaving customers unable to withdraw their savings.
The collapse left millions of customers struggling to access their accounts and prompted protests in Asuncion. Ueno also held hundreds of millions of dollars in public funds, including money used to process pension payments.
Peña's removal marks a major political crisis in Paraguay. The scandal has swept up senior officials and former Ueno executives, while regulators have sought to reassure depositors and contain risks to the wider financial system.
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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