Former President of Paraguay's Central Bank Turns Himself In to Authorities Amid Ueno Bank Scandal: He Was Included in the Arrest Warrant Involving Peña

Carlos Carvallo Spalding surrendered because Paraguay’s Fiscalía had issued an arrest order against him. The order was connected to the investigation into the closure and resolution of Ueno Bank. It also named former president Santiago Peña. The case therefore reaches both the bank’s former leadership and senior public officials.

The warrant includes allegations of presumed lesión de confianza, or breach of trust, along with other punishable acts. The article does not detail every alleged act or identify a final finding of guilt. Carvallo arrived at the Police Department of Investigations with his lawyer and was detained.

He surrendered on Friday, November 6, after the Senate removed Peña and after Peña was detained at home. Prosecutors later requested Carvallo’s transfer to the Agrupación Especializada for his safety. The investigation remains active. Prosecutors have charged 27 people, and the case also examines the Central Bank’s actions and public funds deposited at Ueno Bank.

Placing a bank into resolution means authorities take a structured approach when the institution cannot safely continue under normal management. The goal is to manage failure, protect essential banking services, and reduce harm to depositors and the wider financial system. This is different from simply closing a bank without a plan.

A resolution process can involve transferring deposits and viable assets, selling the bank, replacing management, or winding down operations. The exact tools depend on national law and the bank’s condition. In Ueno Bank’s case, the article says the Central Bank was undergoing the process of resolution, but it does not state which tool authorities selected.

The process matters because it can determine how quickly customers regain access to money and how losses are allocated. The Ueno case has also prompted an investigation into the regulator’s conduct and public funds held at the bank. Further legal and administrative decisions will clarify the bank’s future.

The article does not state how many dollars, guaraníes, or other funds were allegedly exposed. That missing figure is important because the financial scale cannot be calculated from the published details. The available scale indicator is legal rather than monetary: prosecutors have charged 27 people.

The investigation includes former Central Bank president Carlos Carvallo, former president Santiago Peña, and former Economy Minister Carlos Fernández. Miguel Vásquez, identified as one of Ueno Bank’s founders, was among those sent to a facility for people awaiting trial, together with six other detainees.

The case may become clearer as prosecutors examine the destination of public funds deposited at the bank. A group of prosecutors entered the Central Bank while expanding the complaint. Until authorities publish a quantified exposure, the responsible conclusion is that the number of implicated people is known, but the alleged financial loss is not stated.

When a bank enters resolution, customers may experience temporary restrictions, changes in management, or delays while authorities protect deposits and reorganize the institution. Depositors’ final outcome depends on the resolution tools and protections established under national law. The article does not provide those specific terms for Ueno Bank.

In practice, authorities might transfer customer accounts to another bank, preserve payment services, or use a legal deposit-protection system where applicable. Public institutions that held money there could also face delays accessing funds or uncertainty about recovery. These are established possibilities, not outcomes confirmed in this article.

The immediate facts are limited. Prosecutors are investigating the bank’s closure, the regulator’s conduct, and the destination of public funds deposited there. The resolution process and court proceedings should determine access, recoveries, and responsibility. Until those decisions are announced, neither customer losses nor public-institution losses can be stated as facts.

When supervisors detect risky or prohibited transactions, their core duty is to protect the bank and the financial system. They generally investigate the activity, require records and explanations, order corrective measures, and impose restrictions or sanctions when rules are breached. Serious cases may be referred to prosecutors.

The Central Bank sets or enforces banking safeguards through its supervisory structure, including the Superintendency of Banks. Depending on the facts, supervisors may demand stronger controls, limit risky operations, remove responsible managers, or begin a formal resolution process. These are general supervisory functions, not actions confirmed for this case.

The article reports that prosecutors entered the Central Bank while expanding a complaint involving Carvallo, Peña, and Carlos Fernández. The new investigative lines concern the regulator’s conduct and the destination of public funds deposited at Ueno Bank. The legal case will determine whether any duties were breached and by whom.

The Senate found Santiago Peña guilty of “mal desempeño de funciones,” or poor performance of duties, in a political impeachment trial. It then removed him from office. This immediately changed Paraguay’s leadership, because Pedro Alliana assumed the presidency after Peña’s dismissal.

The political decision also coincided with criminal-justice actions. Peña was detained at his home after the Senate vote, while Carvallo surrendered hours later. The arrest order had named both men in a case involving suspected breach of trust and other punishable acts connected with Ueno Bank.

The investigation therefore continued despite the change in government. Peña was taken to the Presidential Escort Regiment and was expected to appear before the Economic and Anticorruption Crimes Unit. His lawyer rejected preventive detention. Meanwhile, prosecutors had charged 27 people and expanded their inquiry at the Central Bank.

Banking rules restrict loans to related companies because insiders may influence decisions, hide conflicts, or give connected businesses unusually favorable terms. Concentrating money among related firms can weaken a bank and put depositors’ funds at risk. Limits make lending more independent and easier to monitor.

Central-bank safeguards can require disclosure, approval, exposure limits, documentation, and ongoing supervision. If a transaction appears risky or prohibited, supervisors can demand correction, restrict further lending, investigate managers, or refer suspected wrongdoing to prosecutors. These controls reduce the chance that private losses become a public burden.

The article does not say that prohibited related-company loans occurred at Ueno Bank. It reports that prosecutors are examining the Central Bank’s regulatory actions and the destination of public funds deposited at the bank. The investigation will determine whether safeguards failed, whether rules were breached, and who may be responsible.