World · Latin America · 4 hrs ago
Paraguay’s former president faces charges after Ueno Bank collapse
Paraguay’s former president Santiago Pena was arrested and removed from office after Ueno Bank collapsed and froze savings for nearly three million customers.
The digital bank had grown quickly by serving people who had been underserved by traditional banks.
Prosecutors say Pena used his political influence to direct public money to Ueno while he had financial ties to its parent company.
He faces charges of breach of trust and personal gain, which could each carry up to 10 years in prison; Pena denies wrongdoing and says he will plead not guilty.
Police searched his home near the capital, Asuncion, as part of the investigation, and a judge ordered him held in pretrial detention at a military facility.
Vice President Pedro Alliana has taken over and is expected to serve until August 2028.
Alliana says the government has refunded 1.2 million customers whose money was frozen, while the investigation into the bank and its links to public funds continues.
Former Paraguayan President Santiago Pena faces criminal charges linked to the collapse of Ueno Bank.
Prosecutors allege that he used his political influence to direct public funds to the bank while holding financial ties to its parent company.
The bank’s collapse froze the savings of nearly three million customers, almost half of Paraguay’s population.
Pena denies wrongdoing and says the bank’s difficulties were a regulatory matter.
Police searched his home as part of the investigation, and a judge ordered him held in pretrial detention.
- Who
- Former President Santiago Pena faces charges. Former Central Bank chief Carlos Carvallo has also been charged.
- What
- Prosecutors accuse Pena of breach of trust and administration for personal gain over alleged actions involving Ueno Bank.
- When
- The Senate voted to remove Pena on Friday; a judge ordered his pretrial detention on Saturday, and police searched his home on Sunday.
- Where
- Paraguay, including Pena’s home outside Asuncion.
- Why
- Prosecutors allege Pena used political influence to direct public money to Ueno Bank despite concerns about its financial health.
Paraguayan prosecutors
Santiago Pena
Allegations
Paraguayan prosecutors
Prosecutors allege Pena influenced government agencies and state-owned entities to deposit public money with Ueno Bank while he had financial ties to its parent company.
Santiago Pena
Pena denies wrongdoing and says the bank’s difficulties were a regulatory matter.
Legal response
Paraguayan prosecutors
Prosecutors charged Pena with breach of trust and administration for personal gain.
Santiago Pena
Pena’s lawyer said he would plead not guilty and cooperate with investigators.
Paraguay’s Senate voted unanimously to remove Pena from office after rejecting his attempt to resign a day earlier.
Judge Humberto Otazu ordered Pena to remain in pretrial detention at a military facility.
Police searched Pena’s home outside Asuncion as part of the banking investigation.
- Customers affected
- Nearly 3 million
- Population of Paraguay
- 6.5 million
- Public funds held by Ueno
- Approximately $850 million by June
- Pena’s loans from Ueno
- Approximately $500,000 in 2024
- Pena’s charges
- Breach of trust and administration for personal gain
What people are saying
What sets a serious country apart is not that its banks don’t fail, but how it responds
If there is one thing that undermines confidence in the financial system, it is attempting to oust the president without evidence.