Former president Santiago Peña detained in Paraguay following Senate dismissal
The Senate dismissed Santiago Peña for poor performance and the Public Prosecutor's Office ordered his house arrest for breach of trust. The crisis originated with the closure of Ueno Bank.
Peña under house arrest following impeachment trial and Ueno Bank collapse
Paraguay's National Police confirmed on Friday 6 November that former president Santiago Peña was detained at his residence hours after being removed from office by the Senate. According to imagenpoblana.com, the order was issued by the Public Prosecutor's Office under the charge of breach of trust, in the context of the political and financial crisis triggered by the closure of Ueno Bank.
The dismissal was approved with 44 votes in favour and one absence, three days after the bank's intervention, one of the largest financial entities in the country. The closure left approximately three million customers without access to their deposits. With the loss of his presidential immunity, Peña was immediately exposed to criminal proceedings.
The detention order was directed to the commander of the National Police and establishes that the former president must remain under house arrest "until such time as he is put at the disposal of the Public Prosecutor's Office in the Unit for Economic Crimes and Anti-Corruption" in Asunción.
Conflicts of interest and diversion of pension funds
The criminal investigation will seek to determine Peña's criminal responsibility in the same matters that motivated his dismissal: conflicts of interest, manipulation of regulatory controls and diversion of pension funds, all linked to his relationship with Ueno Bank.
During his administration, the entity received over 800 million dollars in public money and concentrated 850 million in state deposits, including resources from the Social Insurance Institute. Among the matters questioned is also the deposit of 355 million dollars from the state pension fund above legal limits, as well as the shareholding stake that the former president maintained in the bank's controlling company.
Central Bank also under judicial scrutiny
The Public Prosecutor's Office also ordered the detention of Carlos Carvallo Spalding, who until the previous Tuesday directed Paraguay's Central Bank (BCP). His inclusion broadens the institutional scope of proceedings related to the banking crisis.
Previous investigations by the Public Prosecutor's Office had already resulted in charges against 27 people, including Miguel Vázquez, controlling shareholder of Ueno Bank. Bank executives were also detained preventatively and assets linked to the businessman were seized.
Alliana assumes the presidency and promises compensation to savers
Pedro Alliana, Peña's vice president, assumed the presidency of Paraguay to complete the term until 2028. The new president announced measures for customers affected by the bank closure.
"Our compatriots who today are going through a difficult time as a consequence of the financial collapse will be fully compensated. We will not leave them alone," Alliana stated after receiving the presidential sash and staff.
The Central Bank had already begun a gradual process of returning deposits through the Deposit Guarantee Fund (FGD), with restitutions organised in stages. The promise of full compensation comes as millions of customers continue unable to access their savings.
Source: Google News PY — Crime