ASUNCIÓN, Paraguay — A judge ordered former President Santiago Peña held in pretrial detention at a military facility on Saturday, one day after the Senate removed him from office over the collapse of the digital lender Ueno.
Judge Humberto Otazú said the detention was needed to make sure Peña stays in the country while the case moves forward, Reuters reported. Peña is charged with breach of trust and administration for personal gain.
Peña had gone to the Attorney General’s Office earlier on Saturday to face prosecutors. Both he and Carlos Carvallo, the former central bank chief charged in the same case, declined to testify.
His lawyer, Ricardo Preda, told journalists that Peña is pleading not guilty.
“We will submit to the investigation and I am sure that when this investigation is over the result will be the dismissal,”
The fall took three days. Peña announced his resignation on Thursday. The lower house voted 78-0 to impeach him that day, and the Senate removed him on Friday. Vice President Pedro Alliana took the oath the same day. He will serve out the term, which runs through August 2028.
What Prosecutors Allege
Prosecutors say Peña used the presidency to influence decisions by government agencies and state-owned companies so that large amounts of public money stayed deposited at Ueno. In their account, he kept financial ties to the lender while doing so, and that created a conflict of interest.
The prosecutor’s office put the public and pension funds held at Ueno at about 3.6 trillion guaraníes and $233.4 million as of September. Prosecutor Nancy Salomón said each of the two charges against Peña could bring up to 10 years in prison.
Peña held shares in Ueno’s holding company until March 2025. He has denied wrongdoing and has said the bank’s problems were a regulatory matter.
Carvallo Charged, Savers Partly Repaid
Carvallo faces the same two charges as Peña, plus producing false public documents. Prosecutors asked the court to hold him in pretrial detention too, and that request was still awaiting a ruling on Saturday. They also asked for both men’s assets to be frozen and for six months to build their final case.
Peña appointed Carvallo to head the central bank shortly after taking office in August 2023. Carvallo had run the finance company that became Ueno until 2023, and he resigned as central bank chief this week as the crisis deepened. The central bank has denied any conflict of interest, saying Carvallo stepped aside from Ueno-related decisions.
Prosecutors have charged 27 people in the case. A judge has already ordered six former Ueno directors held before trial, and authorities have seized luxury cars, a yacht and two small planes linked to Miguel Vázquez, Ueno’s controlling shareholder.
The central bank said on Saturday that the equivalent of $160 million had been paid out to nearly 1.2 million savers under the state deposit guarantee scheme. Millions of customers were left unable to reach their money when regulators seized Ueno this week, and the crisis has driven protesters into the streets of Asunción.
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