South Americaupdated 23m ago2 min read
MapProsecutors Detain Ousted Paraguay President Santiago Peña Over Bank Collapse Charges
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Ousted President Santiago Peña detained for questioning over bank-collapse-related breach of trust. Prosecutors charge Peña with abuse of trust, management for personal gain, and related offenses; detention sought.
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Impeachment to Detention
Paraguayan prosecutors detained ousted president Santiago Peña after taking him to the Attorney General's office for questioning on Saturday, hours after Parliament removed him over the collapse of a major bank. The Public Prosecutor charged Peña with an indictment related to "breach of trust and management to achieve personal gains" and demanded his provisional detention, while also seeking asset freezes for Peña and former Central Bank governor Carlos Cardozo. Senator Jolanda Paredes said, "He must go, but not to his home; to a high-security prison," as thousands of protesters clashed with police using rubber bullets and tear gas during demonstrations demanding the return of frozen savings.
The banking crisis began last Tuesday when the Central Bank placed the digital bank Ówino under supervision due to its financial crisis, and the Central Bank's intervention led to the freezing of deposits of nearly 3 million people, described as roughly half of Paraguay's population. On Saturday, the Central Bank announced that 1.2 million Ówino Bank customers had received partial or full compensation for their insured deposits, in accordance with Paraguayan law.
Charges, Custody, and Protest
Prosecutors charged ex-president Santiago Pena and took him into custody Saturday over a banking crisis that left millions cut off from their money and sparked major protests. Judge Hernan Otazu told reporters he had ordered the former president taken into pre-trial custody and held at the same Asuncion facility where he was taken after his removal from office on Friday. Peña was urgently transported during Friday night from his private residence in the Santísima Trinidad neighborhood, in Asunción, to the facilities of the Presidential Escort Regiment (REP) because protests gathered outside his house.
The transfer was arranged as a precaution before the investigative statement scheduled for this Saturday before the Specialized Unit for Economic Crimes and Anti-Corruption of the Public Ministry. Prosecutors asked for Peña's detention pending trial and each of the two criminal offenses charged against Penja carries a sentence of up to ten years in prison.
What Comes Next
As the impeachment of Peña unfolded, the Senate unanimously convicted former Central Bank governor Carlos Cardozo over the collapse of the Ocean Bank and removed him from office on Friday, with his term supposed to end in 2028. Al-Jazeera Net said Peña's successor is his vice president Pedro Aliana, who on Saturday began naming members of the new government, vowing not to abandon the rights of depositors. Peña offered his resignation via X, but both houses declined to accept it, with the Senate instead deciding to press forward with a trial that could result in the president's removal from office.
Peña said, "Whatever the outcome of this process, I will act with responsibility and respect for the Constitution," as prosecutors prepared to defend the case against him. WREG also said the crisis at Ueno Bank turned Peña’s long-ruling Colorado Party against him, leaving millions of depositors, retirees and workers scrambling to recoup frozen savings and unpaid wages.