Paraguay’s Peña impeached and placed under house arrest

Paraguay’s Senate impeached President Santiago Peña on Friday and placed him under house arrest, after the collapse of Ueno Bank left an estimated three million depositors unable to reach their savings. Lawmakers voted 44-0 to remove him on misconduct charges. Vice-President Pedro Alliana was sworn in as interim president until 2028.

Peña had offered to resign on Thursday, after the bank collapse that froze an estimated three million deposits. Senators did not accept that route and instead moved to impeach him, charging him with misconduct — a process that stripped him of the immunity usually granted to former presidents. One of the 45 senators was absent from the vote.

What is Santiago Peña accused of?

The impeachment charges alleged that Peña had conflicts of interest, manipulated regulatory oversight, diverted pension funds and took part in an institutional cover-up involving the central bank. Prosecutor Silvia Margarita Gonzalez Vester said he is due to be questioned on Saturday over allegations of breach of trust, influence peddling and misappropriation of funds. Peña, who until last year held shares in the company that owned Ueno Bank, has denied any wrongdoing. His defence lawyer, Ricardo Preda, called the allegations a “reckless accusation” that was “irresponsible and opportunistic”.

How many people lost access to their savings?

Ueno Bank, a digital bank, was seized by Paraguay’s central bank earlier in the week. An estimated three million depositors — more than half of the country’s population — were left unable to reach their savings and pensions. Queues of customers trying to withdraw money stretched down streets in Asunción on Tuesday and Wednesday. Thousands of people protested on Thursday to demand their money, after earlier demonstrations in which police used tear gas and water cannons.

Who is running Paraguay now?

Pedro Alliana, Peña’s deputy, was sworn in as interim president and will serve until 2028. He promised not to “abandon” the millions of people affected by the scandal. “Compatriots who are now going through a difficult time as a result of the financial collapse will be fully compensated,” Alliana said.

What happens next?

Senate president Basilio Núñez said Peña was found guilty of “dereliction of duty”. Senator Rafael Filizzola said: “We are facing the biggest corruption scandal in our democratic history – a tremendous blow to the state, to private citizens, and to the country’s credibility and image.” Analysts say Peña is likely to be prosecuted over the bank’s collapse. In a video posted on X announcing his resignation offer, Peña said: “It was never my intention to betray the trust you placed in me.”

Frequently asked questions

Who is Paraguay’s president now?

Pedro Alliana, previously vice-president, was sworn in as interim president after Santiago Peña’s impeachment and will serve until 2028.

Why was Santiago Peña impeached?

Senators charged him with misconduct, alleging conflicts of interest, manipulated regulatory oversight, diverted pension funds and a cover-up involving the central bank after the collapse of Ueno Bank.

How many people were affected by the Ueno Bank collapse?

An estimated three million depositors, more than half of Paraguay’s population, were left unable to access their savings and pensions.

Is Santiago Peña under house arrest?

Yes. He was arrested on Friday minutes after the Senate vote and is due to be questioned on Saturday by prosecutor Silvia Margarita Gonzalez Vester.

With reporting from BBC News.

Stock image, not from the events described. City Skyline — Joe deSousa / Wikimedia Commons (CC0 1.0)