Prosecutors in Paraguay have charged former president Santiago Peña over his alleged role in a banking scandal that led to his impeachment and house arrest. He has been accused of breach of trust and administration for personal gain after denying any wrongdoing.
Impeachment and Arrest
Peña was forced from office after a bank collapse triggered a crisis that left more than half of the country’s population without access to their accounts. He was arrested on Friday minutes after lawmakers, including members from his own party, unanimously voted to remove him from office following the collapse of Ueno Bank, which has links to his private business interests.
He had offered to step down, but rather than accept his resignation, senators impeached Peña and charged him with misconduct, stripping him of the immunity usually granted to former presidents. The impeachment charges alleged that Peña had conflicts of interest, manipulated regulatory oversight, diverted pension funds, and participated in an institutional cover-up involving the central bank.
His impeachment passed with 44 out of 45 senators voting in favour of it, while one lawmaker was absent. In a video posted on X announcing his resignation, Peña stated that it was never his intention to betray public trust and that his priority was the peace of mind of Paraguayans who entrusted their savings to the financial system.
Following the vote, senate president Basilio Núñez stated that Peña was found guilty of dereliction of duty. Senator Rafael Filizzola described the event as the biggest corruption scandal in the country’s democratic history, calling it a tremendous blow to the state, private citizens, and the nation’s credibility and image.
Peña’s defense lawyer, Ricardo Preda, described the allegations as a reckless, irresponsible, and opportunistic accusation.
Financial Crisis and Public Outrage
The demise of the digital bank left more than half of Paraguay’s population without access to their savings after the institution was seized by the country’s central bank. Long lines of people trying to withdraw money from Ueno branches snaked down the streets of the capital Asuncion.
An estimated three million depositors remain unable to access their savings and pensions, prompting widespread public outrage. Protests erupted across the country in response, with thousands taking to the streets to demand their money, following earlier demonstrations that featured clashes with police using tear gas and water cannons.
Pedro Alliana, Peña’s deputy, has been sworn in as the new interim president and promised not to abandon the millions of people affected by the scandal. Alliana, who will serve as president until 2028, stated that compatriots going through a difficult time as a result of the financial collapse will be fully compensated.
Analysts indicate that Peña is likely to face formal prosecution over the bank’s collapse.
