Paraguayan prosecutors demand pretrial jail for impeached president
Santiago Peña faces up to 20 years in prison for alleged abuse of power during the collapse of digital bank Ueno.
By Nadia Rahman ·
Prosecutors in Paraguay formally charged former President Santiago Peña on Saturday, asking a judge to order his immediate detention pending trial. The legal move occurred 24 hours after the legislature voted to remove Peña from office following the implosion of the digital bank Ueno. The charges allege breach of trust and administration for public benefit for private gain.
The prosecution team also indicted Carlos Carvallo, the former head of the central bank, on similar counts including the production of false public documents. Both men are accused of manipulating government agencies and state-owned entities to keep large sums of public money parked at Ueno. Investigators say Peña used his executive power to protect the institution while maintaining personal financial ties to it.
Peña held shares in Ueno’s holding company until March 2025. He has denied interference, describing the bank’s failure as a regulatory issue rather than a political one. Neither his legal team nor Carvallo’s representatives responded to requests for comment on the new filings. If a court convicts Peña on both counts, he could face a maximum prison sentence of 10 years for each charge.
The former president arrived at the Attorney General’s Office on Saturday to face the charges. His removal on Friday elevated Vice President Pedro Alliana to the presidency. Alliana, a member of the ruling Colorado Party, was sworn in to serve out the remainder of the term, which ends in August 2028. Carvallo resigned from the central bank earlier this week as the crisis deepened.
The collapse of Ueno has left millions of customers unable to access their funds. Protests have erupted in the capital, Asunción, as the scandal draws in senior officials and former bank executives. Regulators are working to stabilize the financial system amid the turmoil.
On Saturday, the central bank reported that it had paid out the equivalent of 160 million US dollars to nearly 1.2 million savers through the state deposit guarantee scheme. The payout aims to provide immediate relief to depositors while the government manages the legal and economic fallout from the bank's failure.
