Paraguay President Impeached, Arrested Over Bank Collapse
Paraguay's President Santiago Peña has been impeached and placed under house arrest following the collapse of Ueno Bank, impacting millions of depositors and triggering widespread protests.
The Cliff News | 7 November 2026
Paraguay's President Santiago Peña has been impeached and is under house arrest after the abrupt collapse of Ueno Bank, a digital financial institution with ties to his private business dealings. The impeachment followed an urgent vote by lawmakers, including members of his own party, who unanimously decided to remove him from office amidst a deepening financial crisis.
The crisis began earlier this week with the seizure of Ueno Bank by Paraguay's central bank, leaving an estimated three million depositors unable to access their savings and pensions. This has sparked significant public unrest, with widespread protests erupting across the capital, Asunción.
Presidential Impeachment and Charges
Peña had initially offered to resign on Thursday. However, senators opted to impeach him instead, charging him with misconduct. This decision strips him of the presidential immunity typically afforded to former heads of state. The impeachment proceedings revealed allegations of conflicts of interest, manipulation of regulatory oversight, diversion of pension funds, and participation in an institutional cover-up involving the central bank.
Senator Rafael Filizzola described the situation as “the biggest corruption scandal in our democratic history – a tremendous blow to the state, to private citizens, and to the country's credibility and image.”
Legal Proceedings and New Leadership
Prosecutors are set to question Peña on Saturday concerning allegations of breach of trust, influence peddling, and misappropriation of funds, according to prosecutor Silvia Margarita Gonzalez Vester. The impeachment vote was overwhelmingly decisive, with 44 out of 45 senators voting in favour. Senate president Basilio Núñez declared Peña guilty of “dereliction of duty” following the vote.
Following Peña's removal, Vice-President Pedro Alliana was sworn in as the interim President. Alliana pledged that affected citizens would receive full compensation for their losses due to the financial collapse. He is expected to serve as President until the end of the current term in 2028.
Background and Defense
Prior to becoming president, Peña held shares in the company that owned Ueno Bank, a fact that has come under intense scrutiny. He has consistently denied any wrongdoing. His defense lawyer, Ricardo Preda, has characterized the accusations as a “reckless accusation” that is “irresponsible and opportunistic.”
In a national address on Thursday, Peña expressed his apologies, stating, “it was never my intention to betray the trust you placed in me.” Analysts suggest Peña is likely to face further prosecution related to the bank’s failure.