Paraguay's pro-Israel former president taken into custody over banking crisis

Paraguay's pro-Israel former president taken into custody over banking crisis

Paraguayan prosecutors charged pro-Israel ex-president Santiago Pena and took him into custody Saturday over a banking crisis that saw millions cut off from their money and sparked major protests.

Pena, Paraguay's youngest-ever president, was removed from office by the Senate on Friday, just three days after the collapse of a leading bank with which he had business links.

An indictment against Pena states that "between 2023 and 2026, UENO BANK S.A. allegedly received deposits and loans from public and pension entities" and that it "was also allegedly granting loans to companies linked to the bank's economic group in an irregular manner."

The 47-year-old economist owned shares in Ueno Holding, the controlling company of the bank, until he sold them last year.

Pena maintained close relations with Israel, and in 2024, reopened his country’s embassy in the occupied Jerusalem, making it the sixth country at the time to make the move. 

Pena's removal is a further blow for US President Donald Trump's network of allies in South America.

Trump's favourite for Brazilian president, Flavio Bolsonaro, was defeated by left-wing incumbent Lula Inacio Lula da Silva last month.

Report by AFP