The President of Paraguay was dismissed and placed under house arrest after the collapse of Ueno Bank froze the accounts of 2.9 million people

Paraguayan President Santiago Peña was removed from office by Congress on Friday and placed under house arrest shortly afterward, amid a banking crisis that left 2.9 million people without access to their accounts. The 44 senators present voted to impeach him, accusing him of misconduct in office and favoring Ueno Bank.

The central bank ordered Ueno to enter resolution proceedings on Monday due to insolvency. The measure blocked customers’ funds, affecting approximately 60% of Paraguay’s adult population, and people could no longer use their money even for basic purchases. Protests took place in Asunción, some of which escalated into clashes with police.

Prosecutors’ investigation is targeting Peña for illicit enrichment, money laundering and influence peddling. He attempted to resign in order to benefit from lifetime senatorial status, but Congress rejected his resignation. Vice President Pedro Alliana was sworn in as the country’s new leader.

Peña is accused of supporting Ueno’s expansion. He appointed the institution’s former director to head the central bank and held Ueno shares until April 2025.rayele