The Paraguayan Senate has voted to remove President Santiago Peña from office following the collapse of digital lender Ueno Bank. This decisive action, approved unanimously by the senators present, signals a significant political shift in the nation. The move came after the Chamber of Deputies alleged conflicts of interest involving Peña’s association with Ueno Holding and his controversial appointment of former Ueno executive Carlos Carvallo to head the Central Bank of Paraguay. Lawmakers also criticized Peña for legislative amendments perceived to favor personal interests, including those affecting the concentration of Social Security Institute funds in Ueno Bank beyond legal thresholds.
Paraguay’s Constitution, through Article 225, allows impeachment for poor performance of official duties, offenses committed in office, or ordinary crimes. The Senate trial that led to Peña’s ousting was preceded by an accusation from the Chamber of Deputies, which received overwhelming support with 78 votes in favor. Discontent over the president’s handling of state assets and potential misuse for personal gain were central to the proceedings. Peña’s legal representatives argued that the accusations lacked specificity in terms of legal violations. They also claimed that Peña’s resignation letter should have halted congressional proceedings. Nonetheless, the Senate moved forward, asserting that the impeachment focused on professional misconduct rather than criminal activities.
The downfall of Ueno Bank was marked by the Central Bank of Paraguay’s decision to initiate a resolution process upon discovering that the bank’s solvency ratio fell drastically, an alarming signal in the financial sector. In response to the fallout, legislation to expedite payments under the deposit guarantee scheme was rapidly advanced by the Senate. While Vice President Pedro Alliana was sworn in as interim president to serve until the end of the 2023–2028 term, the vacant vice-presidential post was filled by Senator Antonio Barrios.
Concurrently, separate criminal proceedings have been initiated, leading to the detention of both Peña and Carvallo on charges including breach of trust and administration for personal gain. Carvallo faces additional allegations of document forgery. The ongoing investigations have intensified with Judge Humberto Otazú ordering the pretrial detention of Peña. These developments underscore a period of political and economic turbulence in Paraguay, fueled by a crisis that has captured international attention. More details on these proceedings were reported by JURIST.