Former Paraguayan President Santiago Peña has been ordered held in pretrial detention as prosecutors investigate his alleged role in the collapse of digital lender Ueno, deepening a political crisis that has also disrupted access to customers’ savings.

Charges are allegations, not findings

Prosecutors charged Peña with breach of trust and administration for personal gain. They allege he used the presidency to influence government agencies and state-owned entities to keep public funds at Ueno while he retained financial ties to the lender. Peña, who held shares in Ueno’s parent company until 2025, denies wrongdoing and has described the bank’s problems as a regulatory matter.

Judge Humberto Otazú ordered Peña held at a military facility while the investigation proceeds, saying detention was needed to ensure he remained available to the court. Peña’s attorney said he would contest the case and expected the investigation to clear him. The order is a pretrial measure; it is not a finding of guilt.

The case follows the central bank’s intervention in Ueno, which left millions of customers unable to access their accounts. The Central Bank said about 1.2 million savers had received partial or full payments through the deposit-guarantee system, totaling roughly $160 million. Former central bank chief Carlos Carvallo has also been charged in the investigation.

Peña was removed from office by Congress on Friday after the bank crisis prompted impeachment proceedings. Vice President Pedro Alliana was sworn in to serve the remainder of the term. The investigation now moves through the courts as authorities examine the bank’s links with public institutions and the handling of customer deposits.

Sources: Associated Press; Reuters (republished by MarketScreener).