Espert called to Casa Rosada as opposition calls for him to step aside

Just three weeks before a key election that will define the future of his reform agenda, President Javier Milei’s government finds itself at the centre of another scandal.

Opposition lawmakers this week called for La Libertad Avanza national deputy José Luis Espert, the ruling party’s top candidate in next month’s midterm elections, to renounce his candidacy and resign amid revelations he previously took cash from a suspected drug-trafficker.

Espert, 63, is at the centre of a media storm after several outlets reported last weekend that the lawmaker received a US$200,000 payment in 2020 from Federico Andrés “Fred” Machado, an Argentine businessman who faces drug-trafficking allegations in the United States courts.

Speculation over a link to Machado is not new, but freshly leaked US court files indicate Espert was the recipient of a large payment from a trust co-owned by Machado.

Machado is currently being held under house arrest in Río Negro and is subject to an extradition request from courts in the United States, where his partner, Debra Lynn Mercer, has already been convicted.

He faces charges of drug-trafficking, money-laundering and electronic fraud.

Espert, an outspoken economist like Milei, was summoned to the Casa Rosada on Thursday for talks as calls for his resignation ramped up.

The lawmaker was seen walking through the corridors of government house with a stern expression. He refused to talk to the press.

According to government sources, Espert attended an hour-long meeting at which campaign strategies were discussed. It emerged later Thursday that Espert had cancelled his attendance at an evening campaign rally in La Plata. 

Espert’s links to Machado date back to 2019, when he received logistical support for his presidential campaign, including a trip on a private jet and trips in vehicles. 

 

Opposition criticism

Several opposition lawmakers have called on Espert to resign his candidacy for the October 26 midterms and step down from his post as chair of the Lower House Budget Committee. 

Espert, a leading liberal voice who joined the ruling party early in 2024, was appointed last January to head the committee, a strategic spot channelling all the fiscal discussions on public spending and financing the state.

Unión por la Patria (UxP) caucus chief Germán Martínez said the ruling party lawmaker “cannot continue chairing” the body. “The 2026 Budget cannot be seriously debated with a deputy with narco links chairing the committee,” he wrote in a post on social media.

Fellow UxP deputy Victoria Tolosa Paz described the situation as "very serious" and that his continuation was "untenable."

"The situation is extremely serious, not only because he is a proven drug trafficker with an international arrest warrant," but also because "Fred Machado's lawyer is the same as Milei's," said national deputy Martín Soria.

He noted that Espert’s lawyer is Francisco Onetto, who "was a candidate for deputy governor [of Buenos Aires Province] in 2023" for La Libertad Avanza, and emphasised that there are numerous photos of this lawyer "with Javier Milei, Karina Milei and Espert."

Opposition caucus sources rejected allegations of opportunism, saying: “It's not about ideological differences but about preserving transparency and public confidence in a key institution for the control of the country’s finances.”

Espert’s attempts to reject the allegations as an opposition smear campaign have failed to make way. 

According to a report by the consulting firm Ad Hoc, "seven out of 10 mentions of Espert” online made across September 28-30 were linked to the alleged scandal. 

President Milei has to date dismissed calls for him to push the lawmaker aside, backing Espert vociferously.

In a TV appearance on Monday, the head of state described the allegations as “another media operation” and “hairdressers’ gossip.”

He questioned the timing of the claims, given their proximity to the elections.

"It is part of 21st-century socialism, which has been using this methodology for 35 years, and since Kirchnerism is currently the electoral franchise of socialism, it resorts to this type of trickery. They are a band of outlaws," the president said.

 

Denials

Espert made several media appearances this week as he attempted to put a lid on the scandal. 

Dismissing the allegations as a “smear campaign” and political “operation” designed to hurt the ruling party, he said they first surfaced four years ago.

"This dirty campaign dates from 2021. Ever since I’ve been running for Congress, I’m always having to deal with the same thing," stated the economist in one appearance.

However, he drew criticism for one television interview on Wednesday, during which he refused to deliver a yes or no answer to the question of whether he had received the alleged US$200,000 payment.

Espert admits he met Machado, though he has had no choice. A video recorded in 2019 at a book launch event shows him thanking the businessman for his support. 

Nevertheless, he dissociated himself from the criminal accusations against the businessman.

"You can imagine that if I had known what kind of person he was, I wouldn't be thanking him left, right and centre," contended Espert, alleging total ignorance.

Meanwhile, some of Espert’s party allies are now calling on him to clarify the issue.

National Security Minister Patricia Bullrich said midweek that Espert’s explanations to date had been insufficient. 

"I think José Luis has to go back to the media and give a clear answer," Bullrich said. "When you have nothing to hide, it is best to speak up and say things, even if you may be criticised afterwards." 

She stressed that Machado "was prosecuted in 2021," so in 2019, when Espert was a presidential candidate, he "could easily have been unaware" of the businessman’s alleged illegal activities.

Cabinet Chief Guilermo Francos acknowledged Thursday that the claims “are not a minor matter,” though he rejected calls for the candidate to step aside.

"It is not a minor issue. Obviously, I believe that Espert has to give a clear and convincing explanation, but I do not think he has to step aside unless he says that he has some kind of responsibility, which I do not believe he has," Francos said at an event hosted by AmCham.

"He has to give a clear explanation to the public and get out of this situation," said the official.