President Javier Milei suffered another setback as an ally dropped off the top of his party’s ticket just three weeks before a midterm election amid corruption allegations that threatened to sap support for the market-friendly leader in the crucial vote.
José Luis Espert announced his resignation as a candidate for Milei’s libertarian party in Buenos Aires Province on Sunday. Until now, Espert had refused to drop out after a political rival surfaced documents showing he received a US$200,000 payment in 2020 from a man indicted by the US Justice Department in 2021 for drug-trafficking and other crimes.
It’s another political blow for Milei, whose sister Karina also denied separate bribery allegations in August, as his government negotiates a US$20-billion lifeline with US President Donald Trump’s administration. Milei’s libertarian party is up against the ropes before the Oct.ober26 midterms that investors are closely watching after a landslide defeat in a provincial vote last month.
“This is clearly an orchestrated operation by a system that has destroyed Argentina for decades and sustained by a ruthless media trial against me, to which I will no longer lend myself,” Espert said in a post on X.
The latest scandal sowed divisions within Milei’s government, which has embraced an image of being tough on crime and corruption, with some ministers publicly calling on Espert to come clean.
In television interviews last week, he initially dodged questions about the US$200,000 payment, only to admit it in a social media video, claiming the money was for consulting work to help a mining company restructure its debts.
Optics were bad from the beginning. Espert flew to Patagonia with Federico Machado on a plane that was illegally registered. Beyond drug-trafficking, Machado is also accused of money-laundering and other financial misdeeds, according to the US Justice Department investigation. It’s unclear why he hasn’t been extradited to the US since the case began, especially more recently considering Milei’s pro-Trump stance.
Last week, Espert’s leftist political rival Juan Grabois published information about the case from the Eastern District of Texas showing that Espert received payment at his Bank of America account for services provided to Machado. That set off a media firestorm for Milei as he dispatched his economic team to Washington to negotiate financial aid with US Treasury Secretary Scott Bessent.
US investigators haven’t made any allegations against Espert himself, nor is he a focus of that case. The Eastern
by Patrick Gillespie, Bloomberg
Comments