Paraguay’s Peña Faces Senate Trial and Criminal Probes After Ueno Bank Collapse

Santiago Peña was due before Paraguay’s Senate on Friday to defend himself against impeachment, a day after offering to quit over the failure of a digital lender that froze the savings of roughly 3 million people.

Removal requires the votes of 30 of the 45 senators. The defense hearing was set for 10:00 in Asunción (16:00 Türkiye time) on November 6.

Three Investigations, No Charges

Attorney General Emiliano Rolón Fernández on Thursday opened three criminal investigations linked to Ueno Bank, including the president’s connection to the lender.

Opening the cases does not mean anyone has been formally charged. Investigators are examining oversight of the bank, the handling of its failure and the placement of public funds in it.

One case expands a complaint against Peña first filed in October 2025. A second, lodged by senators, targets the president, Vice President Pedro Alliana, a former economy minister and current and former officials at the central bank, the IPS pension fund and the Seprelad anti-money-laundering agency. The third came from Economy Minister Óscar Lovera.

Resignation Offer Left in Limbo

Peña announced on Thursday in a video on X that he would step down. “I have made the decision to present my resignation... I do so thinking of the stability of our country, social peace and the need to preserve our democratic institutions,” he said.

He added: “I want to apologize to the people if at any moment I have failed.”

Congress never completed the process. A joint session called to consider the offer lost quorum after Colorado Party deputies walked out, leaving the resignation neither accepted nor rejected. Peña remains president.

Accepting the resignation would reportedly have made him a senator for life with legislative immunity, complicating any prosecution. A conviction in the impeachment trial would close that route.

Congress did not accept the offer and Alliana has not taken office.

Peña later signaled he would fight. “Given the continuation of the impeachment trial, I will appear and exercise my right to defense,” he wrote.

House Sends Case to Senate

The Chamber of Deputies approved the impeachment accusation on Thursday with 78 votes, a tally reported as 78–0 among those present. The motion had been filed by 35 lawmakers.

The vote sent the case to the Senate; it did not remove Peña. The Senate opened the trial on Thursday evening.

The accusation rests on four points: a conflict of interest through Peña’s stake in Ueno Holding, his appointment of Carlos Carvallo, a former head of Financiera Ueno, to lead the central bank, an alleged push to change conflict-of-interest rules, and allowing IPS deposits in Ueno beyond regulatory limits.

Peña held Ueno Holding shares until 2025, reportedly selling them around April that year, according to his asset declarations. He has denied wrongdoing.

A separate motion to impeach Alliana failed, 48 to 30. If the presidency falls vacant, Alliana would serve out the term to 2028.

Cartes Breaks Ranks

The decisive blow came from within the ruling Colorado Party. Former president and party leader Horacio Cartes publicly backed the impeachment.

Cartes said on social media he would not side with the “theft of public, private and pension funds”. No court has made such a finding.

A Bank That Held the State’s Money

Ueno, a digital bank that grew out of a finance company, was placed under resolution by the central bank on November 3 after its solvency ratio fell below half the legal minimum. Its app, cards and transfers were frozen.

Regulators reportedly found excessive lending to companies tied to controlling shareholder Grupo Vázquez and expenses booked as assets. Those allegations are under investigation.

Public bodies had about $850 million in the bank, according to BBC and Reuters reporting; AP put the figure at more than $800 million. The IPS reportedly had about $355 million there.

Eight senior Ueno executives have been detained, and the wider criminal probe reportedly covers around 27 people. Carvallo resigned as central bank chief at Peña’s request.

The collapse echoes regulatory crackdowns elsewhere, such as Serbia’s revocation of Alta Bank’s license. It also adds to political turbulence across South America after Lula’s fourth-term win in Brazil, and comes as Washington targets illicit finance in the tri-border area Paraguay shares with Argentina and Brazil.

Anger on the Streets

Protesters gathered outside Congress, where tear gas and water cannon were reportedly used. Demonstrators demanded their money back and insisted a resignation should not end accountability.

About 32,000 pensioners were paid through Ueno. Deposits are guaranteed up to 75 monthly minimum wages, about ₲228.3 million per depositor.