The Public Prosecutor's Office of Paraguay reported this Saturday the indictment of former president Santiago Peña and former president of the Central Bank of Paraguay (BCP), Carlos Carvallo, for the financial scandal related to Ueno Bank, and requested for both the precautionary measure of pretrial detention, which was subsequently upheld by a judge.
Peña, removed by the Senate on Friday, has been accused of the criminal offenses of alleged breach of trust, in the capacity of instigator, and administration for his own benefit, in the capacity of perpetrator. Carvallo is attributed the offenses of breach of trust, immediate production of public documents containing false content, and administration for his own benefit, in the capacity of perpetrator, according to the statement released by the prosecutor's office.
The authorities investigate "alleged irregularities in the placement of public and pension resources in Ueno Bank S.A., as well as with the oversight and control mechanisms of the banking entity and the alleged provision of incomplete or altered information regarding aspects linked to those functions".
According to the Public Prosecutor's Office, between 2023 and 2026 Ueno Bank would have attracted large deposits and placements originating from public and pension institutions, while carrying out credit operations with companies linked to its own economic group that would present alleged anomalies. In September 2026, funds from state agencies deposited in Ueno Bank amounted to about 3.6 trillion guaraníes (almost 505 million euros and 233.4 million dollars (almost 206.6 million euros)).
In his capacity as president, Peña "would have intervened in decisions linked to the placement, renewal, and permanence of public and pension funds in Ueno Bank, an entity with which his business group would have maintained economic and corporate relationships". In particular, he had a shareholding stake in Ueno Holding S.A.E.C.A. and met with officials of the Instituto de Previsión Social (IPS) to decide investments in financial instruments issued by the bank.
Carvallo, on the other hand, maintained a prior relationship with Financiera Ueno and made technical observations about the limits of credit exposure, the operations with related companies, and the entity's financial situation, as detailed by the prosecutor's office.
In this context, the Public Prosecutor’s Office requested from the Criminal Court of Guarantees the preventive detention of both defendants, in addition to the general inhibition to alienate and encumber property, the location of bank accounts, deposits, investments, and other financial assets, as well as steps to identify real estate, vehicles, corporate holdings, and other property rights registered in the names of the investigated parties.
Later, Judge Humberto Otazú ordered the preventive detention of Peña. "We understand that guarantees are needed for his continued presence in the country, and that is why the Court has determined to order his preventive detention," Otazú stated in statements to Paraguayan media.
During the hearing on the imposition of measures, Peña chose not to make any statements, while the magistrate indicated that he is studying the request for the attachment of property submitted by the Public Ministry.
The judge also ruled that Peña continue under the presidential escort regime due to the sensitive information he handled when he served as head of State. "All the information that he could have handled as first executive is taken into consideration, as regards financial information, organized crime. You know that this is a scourge that has a great impact, and these are circumstances that one has to take into account," he explained.
Peña’s removal from the Presidency is linked to the collapse of Ueno Bank, a financial entity related to the former business partners of the head of state that collapsed and was taken over by the Central Bank of Paraguay after registering a solvency level below the minimum required levels, which prevented guaranteeing the protection of the millions of deposits from its clients.