“Justice has been served! »: the fall of Santiago Peña, deposed president of Paraguay, after the collapse of an online bank

The deposed President of Paraguay Santiago Peña was placed in preventive detention on Saturday, November 7, following his indictment in connection with the Ueno Bank debacle which harmed millions of savers.

The ex-president will be detained for the moment in a military installation of the presidential guard, where he was transferred Friday evening for security reasons, after having initially been placed under house arrest following his dismissal, indicated the judge in charge of the case Hernan Otazu. On Saturday, he had already been charged with “breach of trust” and “management for personal gain”, as was the former president of the Central Bank Carlos Carvallo.

According to extracts from the indictment to which Agence France-Presse had access, Santiago Peña, who until 2025 held shares in a holding company that owned the bank, is accused of having presided over “a significant increase and concentration of public funds and pension funds” in Ueno Bank, for the equivalent of more than 800 million dollars.

Conservative president of Paraguay since 2023, close ally of Washington, Santiago Peña, 47, whose mandate ended in 2028, was unanimously convicted by the Senate of “poor exercise of his functions” and dismissed. The banking crisis, which quickly turned into a political crisis, broke out on Tuesday November 3 with the Central Bank (BCP) placing Ueno Bank, an online bank that has flourished in recent years, under supervision for insolvency.

The BCP's intervention froze the deposits of nearly three million people - the number of customers Ueno claimed - or almost half of the country's population. Companies, institutions and pension funds have also been affected. Invested in the wake of the dismissal of Santiago Peña, his vice-president until then, Pedro Alliana, 52, affirmed before the Senate that “the compatriots who are going through a very difficult situation because of the financial chaos will be fully compensated. We won’t leave him alone.”

On Saturday, the Central Bank announced that nearly 1.2 million defrauded small savers had recovered their money thanks to payments from the BCP Guarantee Fund into accounts opened in other banks. These disbursements total to date around one billion guaranis ($160,000), Pedro Alliana said on X.

Compensation continues in stages, starting with small accounts held at Ueno. The branches of several Paraguayan banks remained exceptionally open this weekend, BCP announced. “I breathed a sigh of relief when I came to the bank and was able to make sure my money was safe,” Isabel Figueredo told AFP as she left the establishment to which funds were credited.

Machine-translated from French