A Paraguayan judge on Saturday ordered former President Santiago Pena to remain in custody before trial, holding him at a military facility as prosecutors examine his links to the failed digital lender Ueno Bank. Judge Humberto Otazu said the measure was needed to make sure Pena stayed in the country while the case moved forward. The ruling came one day after Congress removed Pena from office over the bank’s collapse, which froze the accounts of nearly three million customers.
Pena, 47, had arrived at the Attorney General’s Office on Saturday morning under police escort and was questioned for about three hours before being returned to military police custody. He will be held at the Presidential Escort Regiment, the military facility where he spent Friday night after being moved from house arrest for security reasons amid protests outside his home. The detention order is a pretrial measure, not a finding of guilt.
Prosecutors charged Pena with breach of trust and administration for personal gain, alleging that he used his position as president to influence government agencies and state-owned bodies to keep large amounts of public money deposited at Ueno, despite his financial ties to the lender. Pena has pleaded not guilty and denied wrongdoing. He could face up to 20 years in prison if convicted of both crimes, according to the Associated Press.
How Pena fell
Pena offered his resignation on Thursday, but Congress declined to accept it and pressed ahead with impeachment instead, a step lawmakers said would strip him of the immunity he would have kept had he stepped down. The Senate removed him on Friday, with all 44 senators present voting in favour and one absent. Vice President Pedro Alliana was sworn in as his successor and will serve out the remainder of the term, which runs through August 2028.
The crisis began on 3 November when regulators seized Ueno Bank after discovering its solvency ratio had fallen below half the legal minimum. Investigators say between 2023 and 2026 large public and pension deposits were placed, renewed or kept at Ueno Bank and that those transfers may have favoured companies linked to Ueno Holding. Prosecutors have incorporated directorate minutes, treasury reports and central bank technical notes into the file.
Pena, who came to power in 2023, held shares in Ueno Holding, the bank’s holding company, until he sold them in March 2025. Police raided Pena’s mansion outside Asuncion on Sunday, according to reports. The criminal inquiry already includes at least 27 executives and founders of Ueno and has produced multiple preventive detentions for directors.
Carvallo also detained
Prosecutors also charged former central bank chief Carlos Carvallo, who previously led Ueno Bank, with breach of trust, administration for personal gain and producing false public documents, and a judge approved his pretrial detention. The prosecution has also sought preventive detention and judicial measures to identify and freeze assets of Pena, Carvallo and other suspects.
New President Alliana has begun naming a new Cabinet and has pledged to help those affected by the bank’s collapse. Pena became the second Paraguayan president to be removed through impeachment since the end of Gen. Alfredo Stroessner’s dictatorship in 1989, after former President Fernando Lugo.
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