Paraguayan prosecutors on Saturday charged former President Santiago Peña with breach of trust and administration for personal gain, and asked a court to jail him pending trial, a day after his impeachment over the collapse of digital lender ueno, Reuters reported from Asunción.

Source: Reuters via Duke FM

Peña had arrived at the Attorney General's Office earlier on Saturday to appear before prosecutors following his removal from power on Friday, Reuters said. He had been placed under house arrest on Friday after an arrest order was issued shortly after he was removed, Al Jazeera reported.

Source: Al Jazeera via 234Radio

Prosecutors also charged former central bank chief Carlos Carvallo with breach of trust, producing false public documents and administration for personal gain, and sought his pretrial detention. Prosecutors said Peña should serve pretrial detention at a location determined by the court, if the judge orders it, Reuters reported.

Prosecutors allege that Peña used his position as president to influence decisions by government agencies and state-owned entities to keep large amounts of public money deposited at ueno, despite maintaining financial ties to the lender — a relationship they say created a conflict of interest as he encouraged, facilitated or influenced decisions benefiting the bank, according to Reuters.

Al Jazeera reported the wider allegations: that Peña directed hundreds of millions of dollars in public funds into ueno while shielding it from regulatory scrutiny, that the bank grew partly through an injection of more than $800 million in public funds (yaani 80 crore dollars se zyada), and that he allowed the state pension fund to deposit $355 million at ueno (yaani about 35.5 crore dollars), above legal limits. These are prosecutors' and lawmakers' allegations, not proven findings.

Peña, who was a shareholder in ueno's holding company until March 2025, has denied wrongdoing and said the bank's problems were a regulatory matter, Reuters reported. AnewZ reported that before the charges were filed, Peña's lawyer Ricardo Preda rejected any pretrial detention, saying there was nothing to justify it, and that both men declined to say anything during their hearing. Reuters said Peña's attorney did not immediately respond to a request for comment on Saturday, nor did Carvallo.

Source: AnewZ

Prosecutors have also asked for the freezing of both men's assets and for six months to formulate their final case, AnewZ reported. The decision on pretrial detention now rests with a criminal court judge.

Carvallo resigned as central bank chief earlier this week as the crisis escalated, Reuters said. He had previously headed the digital lender until 2023, and Peña appointed him to lead the central bank in 2023 — an appointment critics called a conflict of interest. The central bank has denied any conflict, saying Carvallo recused himself from all ueno-related decisions, AnewZ reported.

For savers, the central bank said on Saturday that the equivalent of $160 million had been paid out to nearly 1.2 million savers under the state deposit guarantee scheme, Reuters reported. Al Jazeera said 1.2 million customers had received partial or full reimbursement of their insured deposits — but that many were still waiting, and protests over the collapse continued in Asunción, some of them turning violent.

Background: regulators seized ueno on Tuesday over solvency concerns, leaving nearly three million customers — in a country of about 6.5 million people — unable to access their savings or use their bank cards. In a separate case, a judge has ordered six former ueno directors to be held in pretrial detention, prosecutors have charged 27 people in total, and authorities have seized luxury cars, a yacht and two small planes linked to ueno's controlling shareholder Miguel Vázquez, AnewZ reported.

What happens next: a judge must now decide whether Peña and Carvallo are jailed pending trial or held under another measure, prosecutors have six months to build their final case if the court grants it, and the deposit-guarantee payouts — $160 million to 1.2 million savers so far — are the figure depositors still waiting for their money will measure the state against.