Paraguay President Ousted, Placed Under House Arrest

Paraguay's President Santiago Peña has been removed from office and placed under house arrest following an impeachment trial linked to the collapse of Ueno Bank, triggering a major political transition in the South American country.

The Senate voted on Friday to remove Peña, with all 44 senators present supporting his dismissal over alleged misconduct in office.

Vice President Pedro Alliana was subsequently sworn in as Paraguay's new president and is expected to serve the remainder of the presidential term through August 2028.

The impeachment followed the collapse of Ueno Bank, a rapidly expanding digital lender serving nearly three million customers.

Paraguay's central bank intervened in the institution on November 3 after identifying serious solvency problems, leaving customers unable to access savings and disrupting pension payments.

Prosecutors ordered Peña to remain under house arrest pending questioning by the Attorney General's Economic Crimes and Anti-Corruption Unit.

He is under investigation over allegations including breach of trust and the improper use of political influence in connection with public funds deposited at Ueno Bank.

Peña, who previously held shares in the bank's parent company, has denied wrongdoing.

Authorities also issued an arrest warrant for former central bank chief Carlos Carvallo, whose regulatory oversight is under investigation.

Peña had offered his resignation before the impeachment proceedings, but lawmakers proceeded with the trial.

His removal through impeachment also prevents him from receiving the lifetime Senate seat and associated parliamentary immunity normally available to elected former presidents.

The banking crisis has sparked public protests and raised questions about the handling of approximately $850 million in public funds linked to the lender.

Alliana has pledged to compensate those affected by the bank's collapse as authorities continue criminal investigations into the financial scandal.