Paraguayan president removed from office over bank collapse
Three million depositors are locked out of their savings after lawmakers impeached President Santiago Peña following the seizure of Ueno Bank.
By Isaac Medina ·
More than three million people in Paraguay cannot currently access their savings or pensions. The digital banking crisis has left more than half the nation's population without access to their funds after the central bank seized Ueno Bank earlier this week. The financial shock triggered a political crisis that ended with the removal of the country's president.
President Santiago Peña was arrested on Friday shortly after lawmakers voted to impeach him. The vote passed with 44 of 45 senators in favor, while one member was absent. Senators from Peña's own party joined the majority to strip him of his office. Senate President Basilio Núñez announced that Peña was found guilty of dereliction of duty. Vice-President Pedro Alliana was sworn in as interim president immediately following the vote.
The impeachment charges alleged that Peña had conflicts of interest, manipulated regulatory oversight, and diverted pension funds. Prosecutors also accused him of participating in an institutional cover-up involving the central bank. Although Peña offered to resign on Thursday, lawmakers chose to impeach him to remove his lifetime Senate seat and presidential immunity. He held shares in the company that owned the bank until last year, a fact that fueled the conflict of interest allegations.
Peña was placed under house arrest and is due to be questioned on Saturday. Prosecutor Silvia Margarita Gonzalez Vester said the interrogation will cover allegations of breach of trust, influence peddling, and misappropriation of funds. His defense lawyer, Ricardo Preda, called the allegations a reckless accusation that was irresponsible and opportunistic. Peña has denied any wrongdoing. In a national address on Thursday, he expressed regret and stated that it was never his intention to betray the trust placed in him.
Widespread protests have erupted in the capital, Asunción, as citizens demand relief from the financial freeze. Senator Rafael Filizzola described the situation as the biggest corruption scandal in the country's democratic history. He called it a tremendous blow to the state, private citizens, and Paraguay's credibility. Analysts suggest that Peña is likely to face formal prosecution over the bank's collapse.
Interim President Alliana addressed the nation regarding the financial fallout. He promised that compatriots going through a difficult time as a result of the financial collapse would be fully compensated. Alliana will serve as president until 2028.
