A Paraguayan judge ordered former President Santiago Peña held in pretrial detention on Saturday, after prosecutors formally charged him with breach of trust and administration for personal benefit in the investigation into the collapse of Ueno Bank, BBC News Mundo reported.
“This citizen must be held under pretrial detention to guarantee his submission to this proceeding,” Judge Humberto Otazú, the criminal guarantees judge for economic crimes, told journalists in Asunción after a hearing to impose measures, according to BBC News Mundo, RTVE and El Heraldo. Otazú said Peña abstained from testifying. The former president will remain detained at the Regimiento Escolta Presidencial, the Presidential Escort Regiment, where he spent Friday night.
What Peña Is Accused Of
Prosecutors allege that Peña “intervened in decisions related to the placement, renewal and permanence of large sums of public and pension funds” at Ueno Bank, an entity with whose business group he “would have maintained a prior economic and corporate relationship,” according to the Public Ministry’s statement published on Facebook and reported by BBC News Mundo. Investigators found that by last September, various state agencies held more than $230 million in the intervened bank, the outlet reported.
RTVE reported that the alleged offenses — aggravated breach of trust and administration for personal benefit — carry penalties of up to 10 years in prison, according to prosecutor Christian Benítez of the Specialized Unit for Economic and Anti-Corruption Crimes. The indictment also states that Peña was a shareholder in Ueno Holding, the Vásquez Group conglomerate that owned Ueno Bank, and that he sold that stake in March 2025, RTVE reported, citing the deputies’ impeachment accusation.
Peña’s lawyer, Ricardo Preda, said there was no flight risk or danger of obstruction and that the former president did not intervene in the operations of the private bank, according to ABC Color as cited by BBC News Mundo. Preda criticized the detention decision, telling local press: “He always said he would submit like any citizen to any investigation.”
How the Ueno Bank Scandal Forced His Removal
The detention order came one day after Paraguay’s Senate removed Peña in an impeachment trial for “mal desempeño de funciones” — poor performance of duties — over the bank’s dissolution for insolvency, El Heraldo reported. All 44 senators present voted to remove him, a decision that prevented Peña from becoming a lifetime senator with legal immunity, the outlet noted.
Ueno Bank had 2.94 million clients, including major state institutions whose funds were frozen, RTVE reported. The hydroelectric company Itaipú said it had more than $163 million deposited at Ueno Bank and had already filed legal action with prosecutors to recover the money, BBC News Mundo reported.
The night before the detention order, dozens of Paraguayans gathered outside Peña’s residence to protest the house arrest imposed after his removal, demanding he be sent to prison, BBC News Mundo reported. Videos published by ABC Color and La Nación showed protesters breaching the security cordon, confronting Peña, throwing eggs and hitting passing vehicles. Citing security concerns, authorities moved him from his home to the Presidential Escort Regiment around midnight, the outlet reported.
Others Charged in the Case
Prosecutors also sought pretrial detention for Carlos Carvallo, former president of the Central Bank of Paraguay, on suspicion of breach of trust, producing public documents with false content and administration for personal benefit, RTVE reported. Carvallo, who previously headed Financiera Ueno — the institution from which Ueno Bank was created — presented himself to authorities Friday night and was arrested, the outlet said. Deputies’ accusation noted that the Central Bank board he led authorized the creation of the bank 83 days after his appointment in 2023.
In total, the prosecution has charged 27 people in the case, including Ueno Bank founder Miguel Vásquez, who was transferred to a detention center for defendants along with five other executives on Friday, RTVE and El Heraldo reported.
Depositors Begin Getting Their Money Back
As the investigation advances, Paraguay’s new authorities have begun compensating Ueno Bank clients. Interim Central Bank president Pedro Acosta said that in two days of payments, 1,196,000 people had been covered by the state guarantee, returning a total of 996 million guaraníes, roughly $160 million, BBC News Mundo reported. Interim President Pedro Alliana wrote on Instagram: “My priority is that savers recover their money.” Derlis León, president of the Social Security Institute, assured that all pensioners will receive their payments on schedule.
Frequently Asked Questions
Where is Santiago Peña being held?
He is detained at the Regimiento Escolta Presidencial, not a common prison.
What penalties could Peña face?
Prosecutor Christian Benítez stated that aggravated breach of trust and administration for personal benefit can be punished with up to 10 years in prison, RTVE reported.
How much public money was deposited at Ueno Bank?
By last September, state agencies held more than $230 million at the bank, and Itaipú alone had more than $163 million deposited there, according to BBC News Mundo.
Has anyone else been arrested?
Yes. Former Central Bank president Carlos Carvallo was arrested Friday night, and 27 people in total have been charged, including Ueno Bank founder Miguel Vásquez, RTVE reported.
The case remains open: Peña and Carvallo both declined to testify before prosecutors, and the courts have yet to rule on the substance of the charges against them.
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