The Ueno Bank collapse is turning into one of the biggest financial and political scandals in the history of Paraguay . At issue are suspected banking irregularities, hundreds of millions of dollars in public funds, and business ties between the bank and the country's president, Santiago Pena.

The crisis was triggered on November 3, when the Paraguay's central bank initiated resolution procedures against Ueno after determining that it had breached minimum solvency requirements. The public prosecutor has since announced three investigations into suspected financial crimes; 27 individuals have already been formally charged.

Lawmakers in Paraguay's Congress voted to impeach their president Image: Cesar Olmedo/REUTERS

Pressure on Pena intensified. On November 5, he tendered his resignation , but the Paraguayan Congress did not accept it.…