Paraguay's ousted president Peña ordered detained over collapsed lender

A Paraguayan court ordered former president Santiago Peña into pretrial detention over alleged links to ueno. The case deepens a political and financial crisis following the digital lender's collapse.Ousted Paraguayan President Santiago Pena. (Photo: Reuters) A Paraguayan court on Saturday ordered former President Santiago Pena to be placed in pretrial detention at a military facility as prosecutors investigate his alleged links to digital lender ueno, whose collapse has left millions of customers struggling to access their money.Judge Humberto Otaz issued the order after Pena was charged with breach of trust and administration for personal gain. The judge said detention was necessary to ensure the former president remained in the country while the investigation continued.The order came a day after Pena was removed from office, adding another major development to the political and financial crisis that has triggered protests in the capital Asuncion, drawn several senior officials into the investigation and raised concerns about the country's wider financial system.Pena's lawyer, Ricardo Preda, told reporters that his client had pleaded not guilty and would cooperate with the investigation. "We will submit to the investigation and I am sure that when this investigation is over the result will be the dismissal," Preda said.PROSECUTORS ALLEGE CONFLICT OF INTEREST OVER UENO DEPOSITSThe investigation centres on allegations that Pena used his presidential position to influence government agencies and state-owned entities to maintain substantial public deposits with ueno despite his financial links to the lender. Prosecutors allege that Pena encouraged or influenced official decisions that benefited the bank, creating a conflict of interest.Pena held shares in ueno's parent company until March 2025. He has denied any wrongdoing and maintained that the lender's troubles were a regulatory matter.The former president appeared at the Attorney General's Office on Saturday to face prosecutors following his removal from power a day earlier.The charges against Pena carry a possible prison sentence of up to 10 years each, prosecutor Nancy Salomón said.FORMER CENTRAL BANK CHIEF ALSO CHARGEDFormer central bank chief Carlos Carvallo has also been charged in connection with the case. He faces accusations of breach of trust, producing false public documents and administration for personal gain.Prosecutors have sought his pretrial detention, but the court had not ruled on the request as of Saturday. Carvallo did not respond to a request for comment.He resigned as central bank chief earlier this week as the crisis surrounding ueno intensified. Before taking charge of the central bank, he had headed the digital lender until 2023.Meanwhile, Vice President Pedro Alliana was sworn in as Paraguay's new president on Friday after Pena's removal. A veteran politician from the ruling Colorado Party, Alliana will serve the remainder of the presidential term, which runs until August 2028.In an effort to contain the fallout from the lender's collapse, Paraguay's central bank said on Saturday that nearly 1.2 million savers had received payouts totalling the equivalent of $160 million under the state deposit guarantee scheme.- EndsWith inputs from Reuters