Paraguayan authorities detain former president Santiago Peña
Paraguayan authorities officially detained former President Santiago Peña at his residence on November 6, 2026, hours after the Senate voted 44 in favor, with one absence, to remove him from office.
Senate Strips Presidential Immunity Before Ordering Arrest
The political crisis reached its zenith Friday when the Senate stripped Peña of his presidential immunity, clearing the way for the Public Ministry’s “lesion of confidence” charges. The impeachment process concluded in less than 10 hours, as reported by El País. Following the vote, the Prosecutor’s Office ordered the detention of both the former president and Carlos Carvallo Spalding, who served as the president of the Central Bank of Paraguay (BCP) until Tuesday.
Peña had attempted to preempt his removal by resigning on Thursday, but the Congress refused to accept the resignation, proceeding with the trial to ensure his formal dismissal. His defense lawyers, Adolfo Ferreiro and Ricardo Preda, unsuccessfully challenged the procedural legality of the session.
Bank Failure Leaves Millions Without Deposit Access
The financial scandal centers on the sudden dissolution of Ueno Bank, which had undergone a rapid transformation into a major banking entity in November 2023, just months after Peña took office and Carvallo Spalding assumed the leadership of the BCP. By September 2026, the bank claimed to handle over three million transactions daily, per BBC.
Ousted Paraguayan President Santiago Peña is under house arrest on suspicion of breach of trust. He was detained shortly after the Senate removed him from office following a bank collapse. https://t.co/EXWR8dAi2V
The bank’s failure has left millions of customers without access to their deposits. The government has initiated a salvage plan through the Deposit Guarantee Fund, which limits payouts to 75 minimum wages—approximately $29,000—per account holder. For institutions like the South American Football Confederation (Conmebol), which held $14 million in deposits at the bank, the recovery process remains uncertain, as funds exceeding the guarantee must await the final liquidation of the bank’s assets.
Political Realignment Under Pedro Alliana
Pedro Alliana, the former vice president, has assumed the presidency and is scheduled to serve until August 15, 2028. In his inaugural remarks, Alliana promised full compensation for those affected by the financial collapse, stating, “We are not going to leave them alone.”
Internal friction within the ruling Colorado Party reportedly accelerated the downfall. According to Infobae, Horacio Cartes, the president of the party and a former head of state, publicly supported the impeachment after a reported dispute with Peña regarding the management of the bank.
Financial Entity Collapse Creates Challenges for State
The collapse of a financial entity of this scale creates immediate challenges for the Paraguayan state. Multinational corporations and local firms are currently grappling with liquidity freezes and the broader impact of the scandal on the national banking system.