Paraguay Public Prosecutor's Office seeks preventative detention for former president Peña following Ueno Bank collapse
The Paraguayan Public Prosecutor's Office charged Santiago Peña with breach of trust and self-dealing. Pedro Alliana assumed the presidency and promised to return savings to the bank's customers.
Peña charged and under military custody as Paraguay attempts to stabilise
The Paraguayan Public Prosecutor's Office requested preventative detention on Saturday for former president Santiago Peña, who was summarily removed by Congress following the collapse of Ueno Bank, which had nearly three million customers. According to reports from elpais.com, the Public Prosecutor's Office charged him with "alleged commission of breach of trust, as instigator, and self-dealing, as perpetrator".
Peña made an investigatory statement before the courts on Saturday morning. Hours earlier, he had been under house arrest at his mansion in Asunción, but protesters with drums and sound equipment gathered less than one hundred metres from the entrance demanding his detention and the return of funds. In the early hours, some young people threw stones at riot police and knocked down barriers, managing to get closer to the residence. The police suppressed the protest and transferred Peña to the barracks of the Presidential Escort Regiment, the same building where dictator Alfredo Stroessner took refuge on 2 February 1989, hours before being overthrown.
Cartes Spalding, the former Central Bank president, also charged
Carlos Carvallo Spalding, who until recently chaired the Central Bank of Paraguay, was detained and charged with "alleged commission of breach of trust, immediate production of falsified public documents and self-dealing, as perpetrator". The prosecution's theory holds that between 2023 and 2026 Ueno Bank received substantial deposits from public and pension entities, whilst conducting allegedly irregular credit operations with companies linked to the Vázquez Group.
Alliana takes office with cabinet changes under the shadow of Cartes
Pedro Alliana, who held the vice-presidency over the past three years, assumed the head of state position late on Friday. On Saturday, he began his term with cabinet changes which, according to elpais.com, reveal the influence of former president Horacio Cartes: the new ministers are figures close to the influential politician.
Alliana appointed Ariel Martínez to lead the Interior Ministry, the same position he held during Cartes's government (2013–2018), a period in which he directed police repression against protesters in March 2017, protests in which a police officer killed a young opposition member. For Public Works he appointed Juan Carlos Baruja, another politician identified with Cartes's faction. Further cabinet changes are expected in the coming days that will displace officials loyal to Peña.
The new head of state promised to suspend foreign travel and remain in the country to address the crisis, in contrast to his predecessor, who travelled the world promoting the image of a "giant Paraguay" with high growth rates.
Bank freeze: partial refunds began this weekend
The declared priority of the new government is to lift the bank freeze preventing Ueno Bank customers from accessing their savings. Account holders with balances of up to 1,500 US dollars have already begun recovering their funds. The refund will be progressively extended to other customers, with an initial cap equivalent to 40 monthly minimum wages, that is, approximately 121 million guaraní or roughly 19,300 US dollars. Banks will operate on an exceptional basis this Sunday to facilitate account opening and fund recovery.
Alliana publicly assured those affected that they would all recover their savings, although the opposition and protesters accuse him of having been complicit in the fraud and of not having acted in time to prevent the embezzlement.
The opposition demands early elections
Tension in the streets of Asunción has not subsided. Protesters are calling for Alliana's removal and the convening of early elections for early 2027. The slogans chanted outside Peña's mansion sum up the popular mood: "The clown has fallen, the circus is missing!", "Give back the money from your pocket!" and "Theft is only a crime for the poor".
The Colorado Party, hegemonic in Paraguay for seven decades, meanwhile seeks to close the chapter as quickly as possible. The ruling party faces, however, the challenge of recovering public confidence in a context in which financial institutions and the State itself have come under accusation.
Source: Google News PY — Crime