Peña was ousted from the presidency about an hour beforehand in a unanimous Senate vote, with lawmakers citing questions over his past links to the collapsed digital bank ueno that had provided accounts for nearly half of Paraguay’s population.
Although Peña offered his resignation on Thursday, the Senate chose to finalise the impeachment process rather than accept, and swiftly moved to install his second-in-command, Alliana.
By the time of his arrest, dozens of protesters had gathered outside Peña’s residence. Police installed a security cordon around the property.
The turmoil began earlier this week when Paraguay’s central bank intervened in ueno, whose customers include many people who had not previously had access to a bank account.
The bank had grown rapidly since launching in 2021. But questions had emerged over ueno’s lending practices and its ties to Paraguay’s political and financial elite – including Peña, who until last year was a shareholder in ueno’s holding company, and the central bank chief Carlos Carvallo, who had headed ueno until 2023.
Prosecutors on Friday also issued an arrest warrant for Carvallo, who resigned earlier this week as authorities launched last-ditch proceedings to prevent the lender dissolving. Eight former ueno executives have already been detained.
Others from Peña’s inner circle also resigned, including his interior minister, chief of staff and two advisers.
The impeachment charges that led to his removal alleged that Peña had conflicts of interest, manipulated regulatory oversight, diverted pension funds and participated in an institutional cover-up involving the central bank.
Peña denied any wrongdoing and said the affair was a regulatory issue. The central bank has denied any conflict of interest, saying Carvallo recused himself from all decisions related to ueno.
FROZEN ACCESS TO FUNDS
The political crisis has spilled onto the streets, with demonstrators flocking to downtown Asuncion demanding accountability for ueno’s collapse and faster compensation for depositors whose savings remain frozen.
Small groups of protesters gathered opposite the headquarters of the central bank on Friday, chanting “We want our money.”
