Former Paraguayan President Santiago Peña Placed in Preventive Detention

Former Paraguayan President Santiago Peña was taken into preventive detention on Saturday at a military facility of the presidential guard. This move comes after his impeachment for abuse of trust related to the downfall of Ueno Bank, which affected millions of savers. According to Judge Hernan Otazu, Peña's detention is a measure deemed appropriate by the court.

Peña's troubles began with the collapse of Ueno Bank, which led to a crisis that quickly turned political. The bank's insolvency resulted in the freezing of deposits belonging to nearly three million people, almost half of Paraguay's population. The crisis led to Peña's impeachment by the Senate, which voted unanimously to hold him guilty of malfeasance.

The Ueno Bank crisis unfolded rapidly, starting with the bank's takeover by the Central Bank due to insolvency. This move not only affected individual depositors but also businesses, institutions, and pension funds. The bank's collapse is attributed to Peña's alleged mismanagement, including the concentration of public and pension funds in Ueno Bank, amounting to over $800 million.

Peña, who served as president since 2023 and was a close ally of Washington, had his term set to end in 2028. However, his impeachment led to the ascension of his vice-president, Pedro Alliana, who has pledged to ensure that those affected by the financial chaos are fully compensated. Alliana affirmed that the government would not leave the affected individuals alone.

In a positive development for those affected, the Central Bank announced that nearly 1.2 million small savers have recovered their funds through payments from the Bank's guarantee fund into accounts opened in other banks. This move aims to mitigate the financial hardship faced by those whose deposits were frozen.

The public reaction to Peña's detention has been mixed, with some citizens calling for his imprisonment. Macarena Chilavert, a 33-year-old lawyer, expressed her satisfaction outside the prosecutor's office, saying that those responsible for the financial mess should face prison time.

Peña and former Central Bank president Carlos Carvallo were both charged with abuse of trust and personal management. Peña's detention marks a significant development in the case, which has been closely followed by the Paraguayan public and international observers.

Key points

• Former Paraguayan President Santiago Peña was placed in preventive detention following his impeachment for abuse of trust linked to the collapse of Ueno Bank.
• The Ueno Bank crisis affected nearly half of Paraguay's population, with deposits of almost three million people frozen.
• Nearly 1.2 million small savers have recovered their funds through payments from the Central Bank's guarantee fund.