Paraguay presidential residence raided in bank probe

Detailed summary

Investigators raided the official residence of Paraguay's president on Thursday as part of a probe into the collapse of one of the country's largest banks, the public prosecutor's…

Investigators raided the official residence of Paraguay's president on Thursday as part of a probe into the collapse of one of the country's largest banks, the public prosecutor's office told AFP.

The collapse of Ueno Bank -- which has blocked millions of Paraguayans from accessing their savings -- led to the ouster and arrest earlier this month of former president Santiago Pena, who has been accused of using his position to illicitly benefit the financial firm.

The raid "is part of the investigative proceedings...in connection with the case against the former president," the prosecutor's office said in a statement.

A central bank official, Holger Insfran, was also arrested on Thursday during a raid on his home in the capital Asuncion.

The central bank's ex-president, Carlos Carvallo, who formerly led Ueno Bank, has already been placed in pretrial detention.

Investigators on Monday raided Pena's private home in Asuncion, seizing documents, cell phones and computers.

The November 3 takeover of Ueno Bank amid major insolvency concerns locked almost half the population of the normally stable country out of their accounts.

The central bank said Wednesday it had used a deposit guarantee fund to partially refund around 1.8 million people.

The number of individuals affected by the crisis surpasses the number of Ueno's direct clients, which held over $800 million in public funds.

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