Ousted Paraguayan President Santiago Pea placed under house arrest after bank collapse

Ousted Paraguayan President Santiago Peña was placed under house arrest Friday on suspicion of breach of trust and influence peddling, among other charges, shortly after the Senate removed him from office over the collapse of a government-linked bank that locked nearly half the country’s 6 million people out of their savings.All 44 senators present voted to remove Peña for misconduct in office, making him the second Paraguayan president ousted by impeachment since the end of Gen.Alfredo Stroessner’s 35-year dictatorship in 1989.As the verdict came down, ending what had been seen as one of South America’s most stable presidencies, a roar rose from the crowds packed into the plaza outside Congress.

Depositors, retirees and students in national soccer jerseys waved Paraguayan flags, sang and hugged, chanting “Dictatorship never again!”Regulators had seized Ueno Bank just three days earlier, sending shock waves through the financial system and setting off the country’s worst political crisis in more than a decade.Peña was ordered to remain at one of his homes in Asunción until he appears before prosecutors Saturday morning on charges of breach of trust, influence peddling and using public office for personal gain, the most serious of which carry up to 10 years in prison.Lawmakers accuse him of using his political influence to steer hundreds of millions of dollars in public funds into Ueno while regulators overlooked risky insider lending.Peña has denied wrongdoing.Police ringed the house Friday night as crowds gathered outside, waving flags and vowing to keep vigil until morning to make sure he didn’t escape.Prosecutors also ordered the arrest of Carlos Carvallo, who ran the finance company that became Ueno until Peña named him central bank chief in 2023.

It was not immediately clear whether Carvallo had been taken into custody.Vice President Pedro Alliana was sworn in as president Friday to serve out the term, which ends in August 2028.“The Par...