A president who once stood at the top of his nation's political life now finds himself on the far side of its institutions, placed under house arrest days after the Senate removed him from office. The thread running through it is familiar to any society that has trusted a bank and watched that trust freeze: about three million Paraguayans, ordinary savers among them, cannot reach their own money while the Central Bank holds Ueno Bank's accounts. Whether the suspicion of breach of trust will settle into judgment, and whether the savers will see their funds again in full, remain open questions t
Paraguay's Impeached President Pena Placed Under House Arrest Amid Banking Crisis
Around 3 million people have been unable to access their money since Ueno Bank's accounts were frozen, prompting thousands to protest in the streets.
Around 3 million people have been unable to reach their money
Mark
Why did this move so fast, from a frozen bank to an arrested ex-president in days?
Mimi
The freeze hit about 3 million people at once. Thousands protested three nights running, and even senators from Pena's own party voted to impeach him. The vote was 44 in favor, with one absence.
Luke
Speed isn't proof of guilt, though. What is actually established?
Mimi
He was arrested on suspicion of breach of trust, and the Attorney General is investigating acts tied to Ueno's supervision and the placement of public funds there.
Luke
Suspicion and investigation, not a charge proven. And the conflict-of-interest claim comes from opposition lawmakers; Pena denies it.
Mark
But he did hold a stake in Grupo Vazquez, which controlled Ueno.
Mimi
Yes, until last year. That link is why the anger landed on him personally.
Luke
Fair, but the reporting doesn't say what he did with that stake or how it shaped any decision. That's still unknown.
Mark
And the depositors?
Mimi
Advance payments of up to about $1,600 began Thursday for clients with no loans and an account elsewhere. The rest will be announced progressively.
Luke
Note that the number paid so far wasn't given, and there's no timeline for everyone else.
Il Polso
- The Senate removed President Santiago Peña by a vote of 44 to zero, after he had already offered to resign and apologized to the nation.
- Three million people have lost access to their savings since the Central Bank froze Ueno Bank's accounts, and crowds have filled Asunción's streets night after night.
- Prosecutors are probing Peña over the supervision of Ueno Bank and the placement of public funds in it, while he denies any conflict of interest tied to his former stake in the bank's parent group.
- Advance payments of up to roughly US$1,600 have begun for eligible depositors, but the full scope and timeline of repayments are still being announced in phases.
- Crowds remain on the streets as the country waits to learn how far the investigation will reach and whether savers recover their money.
A president who once stood at the top of his nation's political life now finds himself on the far side of its institutions, placed under house arrest days after the Senate removed him from office. The thread running through it is familiar to any society that has trusted a bank and watched that trust freeze: about three million Paraguayans, ordinary savers among them, cannot reach their own money while the Central Bank holds Ueno Bank's accounts. Whether the suspicion of breach of trust will settle into judgment, and whether the savers will see their funds again in full, remain open questions that the coming weeks will answer.
On Friday, Paraguay's former president, Santiago Peña, was placed under house arrest, only days after the Senate voted to remove him from office. He is suspected of breach of trust in connection with the collapse of Ueno Bank, a lender tied to his government. The Senate vote was 44 of 45 in favor, and even lawmakers from his own party backed it. Peña, who did not attend the trial, had offered to resign and had apologized in a video address, saying he never meant to betray the trust placed in him.
The crisis began on Tuesday, when the Central Bank took control of Ueno Bank and froze its accounts over solvency concerns. Roughly three million people have been unable to reach their money since. On Thursday, thousands marched for a third straight night in Asunción and other cities, demanding their savings back. Outside Congress, a small crowd waited for the verdict, and one protester held a sign reading "Peña in prison."
Peña, 47, held a stake in Grupo Vázquez, which controlled Ueno until last year. Opposition lawmakers accused him of a conflict of interest, which he denies. The Attorney General is investigating his role in the supervision and resolution of the bank and in the placement of public funds there.
For depositors, some relief has begun. Advance payments started Thursday, with the first phase paying up to about US$1,600 to clients who have no loans and hold an account at another Paraguayan bank or institution. Further groups will be announced as payments proceed. What comes next depends on how far the inquiry reaches and how quickly repayments extend beyond that first group.
On Friday, Paraguay's Santiago Pena, the president the Senate had just removed from office, was placed under house arrest. He is suspected of breach of trust in connection with the collapse of Ueno Bank, a lender tied to his government. The arrest came only days after the impeachment vote.
The Senate trial ended with 44 of 45 senators voting in favor of impeachment; the remaining senator was absent. Senate President Basilio Nunez announced the result, declaring the president guilty of poor performance in his duties. Pena had pledged to defend himself but did not attend the proceedings. Even lawmakers from his own party backed the vote. He had offered to resign over the crisis, but lawmakers pressed ahead with the impeachment, a step that would strip him of the immunity granted to former presidents.
The crisis began on Tuesday, when the Central Bank took control of Ueno Bank and froze its accounts over concerns about its solvency. Around 3 million people have been unable to reach their money since. The anger spread quickly. On Thursday, thousands protested for a third consecutive night in Asuncion and other cities, demanding their savings back, according to Reuters. Outside Congress, about 250 people gathered to await the verdict, and one held a sign reading: "Pena in prison."
Pena, 47, is backed by the United States. Until last year he held a stake in Grupo Vazquez, which controlled Ueno. Opposition lawmakers have accused him of a conflict of interest, which he denies. The country's Attorney General said it is investigating him for acts related to the supervision and resolution of Ueno Bank S.A. and the placement of public funds in that institution.
In a video address to the nation, Pena apologized. He said it was never his intention to betray the trust people had placed in him. The US embassy in Paraguay, for its part, expressed solidarity with the Paraguayan people on Friday and did not mention the president.
For depositors, some relief has begun. Jose Maciel of the Central Bank's Deposit Guarantee Fund said advance payments to an unspecified number of affected clients started Thursday afternoon. The first phase pays up to about US $1,600 to clients who have no loans and who hold an account at another bank or institution in Paraguay. Further beneficiaries, he said, will be announced progressively as payments proceed.
Two things to watch now: how far the Attorney General's inquiry reaches into the supervision of Ueno and the placement of public funds, and how quickly the phased repayments extend beyond that first group of depositors. (With inputs from the Associated Press.)
Citazioni salienti
It was never my intention to betray the trust you placed in me.— Santiago Pena, in a video statement
The next beneficiaries will be announced progressively over the course of the payment process.— Jose Maciel, Central Bank's Deposit Guarantee Fund
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Politics & Governance