Question 1

What is Poravoty Ltda.?

Accepted Answer

Poravoty Ltda., formally known as PORAVO TY Lida. C.M.A.C.S.Con.P.V., was a savings and credit cooperative based in Paraguay. The cooperative was established to provide financial services to its members, including savings accounts, fixed-term deposits, and credit services.

The institution primarily served middle-class families, particularly retirees and elderly individuals who relied on the cooperative for their savings and retirement funds. At its peak, the cooperative claimed approximately 12,000 members, though this figure was later disputed, with active membership estimated at around 3,000 members.

Question 2

When was Poravoty Ltda. founded?

Accepted Answer

Poravoty Ltda. was founded in 2011. The cooperative was established by Miguel González Duarte, a retired police subofficial, along with Apolonio Mendría, also a former police officer.

The founders later formed an independent political party using the cooperative as a platform, attempting to secure elected positions in municipal and national elections. This political involvement raised concerns about conflicts of interest and the proper governance of the institution.

Question 3

When did Poravoty Ltda. close?

Accepted Answer

Poravoty Ltda. was intervened by the Instituto Nacional de Cooperativismo (INCOOP) on February 15, 2025, through Resolution 13/2025, following financial difficulties and liquidity problems that had been ongoing for some time.

The intervention came after multiple complaints from members who were unable to withdraw their deposits. INCOOP subsequently filed criminal charges for alleged fraud, and the case was assigned to prosecutor Óscar Delfino of Unit 11 in the capital. The cooperative's accounts were frozen, and its operations were suspended indefinitely.

The financial losses reported exceeded 200 billion Paraguayan guaraníes (approximately $35 million USD), affecting more than 700 depositors with fixed-term accounts. The cooperative's license was ultimately revoked, making it one of 22 cooperatives shut down by INCOOP in 2024-2025 due to mismanagement and financial insolvency.

Question 4

Where was Poravoty Ltda. headquartered?

Accepted Answer

Poravoty Ltda. was headquartered in Fernando de la Mora, a city in the Central Department of Paraguay, which is part of the greater Asunción metropolitan area.

The cooperative maintained its main office in this location and operated several branch agencies throughout the interior regions of Paraguay before these were closed following the intervention.

Question 5

Where did Poravoty Ltda. operate?

Accepted Answer

Poravoty Ltda. operated primarily in Fernando de la Mora and maintained multiple branch agencies in various locations throughout Paraguay's interior regions.

The cooperative expanded its reach to serve members across different departments of the country. However, all branch locations were closed following the INCOOP intervention in February 2025, leaving members unable to access their funds or conduct any transactions.

Question 6

What services did Poravoty Ltda. offer?

Accepted Answer

As a multiservice savings and credit cooperative (Cooperativa Multiactiva de Ahorro y Crédito), Poravoty Ltda. offered the following services:

Savings products: The cooperative provided savings accounts and fixed-term deposits to its members. Reports indicate the institution offered interest rates as high as 23% on fixed-term deposits, significantly above market rates, which attracted depositors but also contributed to unsustainable financial practices.

Credit services: Members could access various loan products, including personal loans and consumer credit. The cooperative's lending practices, however, later came under scrutiny during the investigation.

Member services: As a cooperative, the institution provided services exclusively to its members, operating under the principle of mutual aid and member ownership.

Question 7

What made Poravoty Ltda. unique?

Accepted Answer

Poravoty Ltda. became notable for offering exceptionally high interest rates on fixed-term deposits, reaching up to 23% annually—far exceeding normal market rates in Paraguay. This high-yield strategy attracted significant deposits but ultimately proved financially unsustainable.

The cooperative was also distinctive for its political involvement. The leadership formed an independent political party and used the cooperative as a platform to pursue electoral positions in municipal and national elections, raising serious governance concerns.

The institution's collapse became a high-profile case highlighting systemic weaknesses in Paraguay's cooperative sector. It exposed inadequate oversight by INCOOP, the absence of deposit insurance for cooperative members, and the vulnerabilities of the cooperative regulatory framework.

Question 8

What type of financial institution was Poravoty Ltda.?

Accepted Answer

Poravoty Ltda. was a Cooperativa Multiactiva de Ahorro y Crédito (Multiservice Savings and Credit Cooperative), which is a specific type of financial cooperative recognized under Paraguayan law.

Unlike banks, which are regulated by the Superintendencia de Bancos (Banking Superintendency) and subject to Basel regulations and deposit insurance through the Central Bank, cooperatives in Paraguay are overseen by the Instituto Nacional de Cooperativismo (INCOOP). This regulatory framework has less stringent capital requirements and supervision standards compared to traditional banking institutions.

Cooperatives operate as member-owned, non-profit organizations where members are both owners and clients. However, unlike the banking system, Paraguay's cooperative sector lacks a deposit guarantee fund, leaving members vulnerable to total loss when cooperatives fail. This structural difference became devastatingly apparent in Poravoty's collapse, where over 700 depositors lost access to their savings with no recourse for recovery.

Question 9

What were the circumstances of Poravoty Ltda.'s intervention?

Accepted Answer

INCOOP intervened Poravoty Ltda. after conducting two prior inspections in 2024 following complaints about alleged money laundering and lack of liquidity. Despite detecting financial inconsistencies and administrative irregularities "for some time," INCOOP delayed intervention until the cooperative reached complete insolvency.

At the time of intervention, Miguel González Duarte served as president—a former police officer dismissed for misconduct in 2002 and allegedly involved in a previous embezzlement case at the Círculo de Suboficiales Retirados de la Policía Nacional. Questions arose about why INCOOP originally authorized someone with such background to establish and lead a financial cooperative.

The affected members formed advocacy groups, including "Nuevo Rumbo," representing approximately 260 members who organized protests demanding accountability and the resignation of INCOOP president Carlos Romero Roa. Members alleged that funds were diverted to a central cooperative and accused authorities of deliberately steering the institution toward bankruptcy.

Question 10

What systemic issues did Poravoty Ltda.'s failure expose?

Accepted Answer

The collapse of Poravoty Ltda. highlighted fundamental structural problems in Paraguay's cooperative financial sector that have affected dozens of similar institutions.

Regulatory inadequacy: While banks operate under strict Basel-compliant supervision by the Central Bank with capital requirements, risk management protocols, and conflict-of-interest controls, cooperatives face minimal oversight. INCOOP lacks sufficient technical staff, operates with limited budgets, and combines promotional and supervisory functions—creating inherent conflicts of interest that weaken enforcement.

No deposit insurance: Unlike bank depositors who have protection through the Central Bank's deposit guarantee fund (covering up to 75 minimum wages, approximately $24,000), cooperative members have zero protection. Discussions about creating a cooperative deposit guarantee fund began around 2008-2009 but have not materialized due to resistance from cooperative leadership and funding challenges.

Political influence: The cooperative sector wields significant political power in Paraguay, with representatives participating in the selection of their own regulators. This structure undermines independence and enables lax enforcement. Paraguay's Minister of Economy, Carlos Fernández Valdovinos, acknowledged the need for institutional reform, suggesting creation of an independent Superintendencia de Cooperativas similar to the recently established Superintendencia de Pensiones for pension funds.

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