Paraguay's President Santiago Peña Removed from Office and Placed Under House Arrest After Ueno Bank Scandal
Parliament in Asunción dismissed Santiago Peña through a unanimous vote, and Vice President Pedro Alliana was sworn in as the country's new leader.
Peña removed through unanimous vote following Ueno bank scandal
Paraguayan Vice President Pedro Alliana was sworn in as leader of Paraguay on Friday, whilst his predecessor, Santiago Peña, was placed under house arrest, according to veridica.ro. Parliament in Asunción had voted unanimously to dismiss him, choosing to proceed with the formal procedure rather than accepting the resignation Peña had submitted on Thursday. The direct consequence: the former head of state lost his right to a lifetime seat in the Senate — a position which would have ensured him immunity from criminal prosecution.
The accusations that formed the basis of the dismissal procedure concerned conflicts of interest, manipulation of surveillance and regulatory mechanisms, embezzlement of pension funds, and participation in an institutional cover-up in which the Central Bank would have been implicated. Peña denied any illegal conduct, declaring that the situation represented a regulatory problem.
Crisis stemming from Ueno bank
The political upheaval began at the start of the week when Paraguay's Central Bank intervened in the case of commercial bank Ueno, an institution that had experienced rapid growth since its launch in 2021, whose clients included numerous people without prior access to a bank account. There were nonetheless serious concerns about its lending practices and its links to the country's political and financial elite. Until last year, Peña had been a shareholder in Grupo Vazquez, which owned Ueno. The head of the Central Bank, Carlos Carvallo, had himself run Ueno until 2023.
Also on Friday, prosecutors issued an arrest warrant for Carvallo, who had resigned at the start of the week. He denied the existence of any conflict of interest, stating that he had abstained from participating in all decisions regarding Ueno. Other associates of Peña also resigned: the interior minister, the head of cabinet, and two of his advisers. Eight former directors of Ueno were detained.
Protests in the capital's centre
The crisis also spread to the streets. Protesters gathered in the centre of Asunción to demand accountability for those responsible for the collapse of Ueno and to accelerate compensation for depositors with frozen savings. Groups of demonstrators also assembled outside the Central Bank's headquarters, chanting: "We want our money back!". Among those affected were pensioners who received benefits and allowances from the state through Ueno.
At the start of the week, Peña had approved a law intended to expedite payments to affected depositors, and some account holders began to recover their funds on Thursday. Regulatory authorities had meanwhile guaranteed the majority of deposits and limited the risk exposure of the entire financial system in an attempt to stabilise the markets.
Source: Google News RO — Crime (ro)