Paraguayan authorities searched the home of former President Santiago Peña, near the capital Asunción, yesterday, Sunday, as part of an investigation into the collapse of Ueno Bank, which led to his removal from office and his detention, the prosecutor’s office announced.
The banking crisis, which from the outset took on a highly political dimension, erupted on Tuesday when the financial institution was placed under the supervision of the central bank (BCP) and entered into liquidation due to insolvency. The savings, credit cards, and debit cards of nearly three million of its customers—comprising the majority of the country’s adult population—were frozen.
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Paraguayan president resigns amid banking scandal
The search of Santiago Peña’s home was related to charges of “breach of trust” and “misappropriation of funds for personal purposes,” according to a statement from the prosecutor’s office.
Mr. Peña was taken into custody on Saturday.
According to excerpts from the indictment obtained by Agence France-Presse, Mr. Peña, who until the spring of 2025 held shares in the holding company that owns the bank, is accused of playing a central role in the massive “increase” and “concentration” of public funds and pension fund resources at Ueno, amounting to more than 800 million dollars.
According to the indictment, Mr. Peña received two loans from Ueno in May, totaling $500,000, to finance the construction of the residence under investigation.
The 47-year-old conservative politician, president of Paraguay since 2023 and an ally of Washington, whose term was scheduled to end in 2028, was unanimously found guilty by those present in the Senate during his trial of “misconduct” in office and was removed from office.
Vice President Pedro Ayana was then sworn in as the new head of state and ordered that taxpayers affected by the bank’s collapse, which had grown at a dizzying pace from its founding in 2021 until its collapse last week, “not to pay fines, late-payment surcharges, or interest due to this problem.”
The new head of state stated that 1.2 million depositors had received, in part or in full, 1.2 million depositors had received their money, meaning that a total of nearly $160 million had been returned to the beneficiaries. The process will continue this week.
Source: APE-MPE
