Paraguay’s Vice President Takes Over as President After Peña’s Impeachment, Former Leader Under House Arrest

Paraguay Political Turmoil: Pedro Alliana Becomes President After Santiago Peña’s Impeachment, Former Leader Under House Arrest

Paraguay has undergone a major political transition after Vice President Pedro Alliana was sworn in as the country’s new president on Saturday, following the Senate’s unanimous decision to impeach and remove Santiago Peña. The former president has been placed under house arrest as investigators examine his alleged involvement in a banking scandal that has shaken the country.

Alliana took the oath of office shortly after the Senate voted to remove Peña over the collapse of Ueno Bank, a crisis that reportedly disrupted banking services for nearly three million customers and prevented them from accessing their savings.

The 52-year-old leader will serve the remainder of the presidential term until August 2028. In his first response to the crisis, Alliana assured affected depositors that his government would work to protect their interests and facilitate the recovery of their money.

PEÑA FACES INVESTIGATION AFTER REMOVAL FROM OFFICE

Following his impeachment, Peña was placed under house arrest at his residence in Asunción.

Prosecutor Silvia Margarita Gonzalez Vester confirmed that the former president would remain under the restriction until investigators question him. The probe reportedly involves allegations of breach of trust, influence peddling and misappropriation of funds.

Investigators are examining allegations that Peña used his political influence to direct hundreds of millions of dollars in public funds towards Ueno Bank despite concerns about its financial position and risky lending practices.

Peña has rejected the allegations. His lawyers had earlier urged lawmakers to accept his resignation, which he submitted on Thursday, instead of continuing with impeachment proceedings.

His removal from office also means he loses the lifetime Senate seat and parliamentary immunity ordinarily available to former elected presidents under Paraguay’s Constitution.

NEW PRESIDENT INHERITS UENO BANK FALLOUT

Alliana now faces the immediate challenge of addressing the financial crisis surrounding Ueno Bank.

Financial regulators took control of the institution earlier this week amid concerns about its financial stability. The move left millions of customers unable to access their deposits, withdraw cash or use their banking cards.

The Central Bank has started releasing advance payments to eligible account holders, initially covering deposits of up to 10 million guaranies, approximately $1,600.

However, the crisis has also placed Alliana under scrutiny. Prosecutors are investigating his possible connections to the banking controversy, while an opposition-backed attempt to impeach him was put aside by lawmakers on Thursday.

PROTESTS INTENSIFY AS DEPOSITORS DEMAND ANSWERS

The collapse of Ueno Bank has triggered demonstrations across Paraguay, with angry customers demanding access to their savings and action against those allegedly responsible for the financial turmoil.

The crisis has developed into a major political challenge for the new administration, which must simultaneously address depositors’ concerns, stabilise the banking sector and cooperate with investigations into the alleged financial irregularities.

Alliana’s presidency begins amid mounting public pressure, with the handling of the Ueno Bank crisis likely to remain a defining issue for his government in the coming months.