MercoPress. South Atlantic News Agency

Paraguay’s banking superintendent arrested in the Ueno Bank investigation

Insfrán was named in a criminal complaint expanded by opposition lawmakers last week, alongside the economy minister and other officials

Paraguay’s Superintendent of Banks, Holger Insfrán, was arrested on Thursday as part of the investigation into the collapse of Ueno Bank, which has already led to the pre-trial detention of former President Santiago Peña and former Central Bank president Carlos Carvallo, according to prosecution sources cited by the EFE news agency. The charges against him have not been disclosed.

The Superintendency of Banks, part of the Central Bank, is responsible for supervising and regulating Paraguay’s financial institutions, including Ueno. Insfrán was named in a criminal complaint expanded by opposition lawmakers last week, alongside the economy minister and other officials.

According to prosecutors, Ueno received large amounts of public funds during Peña’s term, including from five pension funds, while granting allegedly irregular loans to companies owned by its owners, the Vázquez Group. The bank had 2.94 million customers.

Peña, removed by the Senate on November 6, is charged with alleged breach of trust, as instigator, and self-serving administration, as perpetrator, and could face a maximum sentence of 15 years, according to prosecutors. He says he is innocent. Carvallo, who headed the finance company from which the bank emerged before Peña appointed him to lead the Central Bank in 2023, is accused of breach of trust, producing false public documents and self-serving administration.

The Central Bank said on Wednesday that 100% of customers covered by the state guarantee have received an advance of up to 40 minimum wages, about 121.8 million guaraníes or roughly US$19,600, under the emergency law passed by Congress. It has until Monday to complete repayments up to the guarantee ceiling of 75 minimum wages, about 228.3 million guaraníes or roughly US$36,600.