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Corruption. Nepotism. Bribery. Cronyism. These are the accusations that Javier Milei hurled at la casta, the Argentine political class, during his meteoric rise to the presidency. Now, Argentina’s eccentric economist-in-chief is facing the same allegations turned against his own political movement. Audio recordings purporting to detail a kickback scandal conducted through Argentina’s disability benefits agency were released to the public late last month—a development that could derail the president’s La Libertad Avanza (LLA) party during critical legislative elections in October.
One recording contains what appears to be the voice of Diego Spagnuolo, a personal friend of Milei and at the time head of Argentina’s National Disability Agency (ANDIS), recounting a scheme in which the medical supply company Suizo Argentina would mark up prices on its contracts and pay the difference to various employees in the Argentine government, including (per the recording) Javier Milei’s sister and general secretary of the president’s office, Karina Milei. The recording also has Spagnuolo complaining that he had told the president about the kickback scheme and received no instructions to stop it, although he also asserts that the president was not personally involved.
The release of the recordings has thrown Argentine politics into complete chaos. Spagnuolo refused to resign from his position as director of ANDIS, so Milei fired him shortly after the recordings were released. The Argentine courts have stirred to action, seizing Spagnuolo’s phone as evidence and beginning investigations of the Kovalivker family, who run Suizo Argentino and are allegedly responsible for the bribery scheme. Milei’s motorcade was attacked by protesters hurling rocks and insults at an August 27 campaign rally in Buenos Aires, forcing security to evacuate the president as the event dissolved into a violent clash between libertarians and demonstrators.
No material evidence has yet surfaced for the allegations of corruption contained in the recordings.Yet some of the circumstances are deeply uncomfortable for supporters of the administration. Karina Milei has already fallen under suspicion of using her brother’s political position to enrich herself during the $LIBRA crypto scandal earlier this year, making her particularly vulnerable to such accusations. Additionally, Suizo Argentino’s contracts with the Argentine government expanded massively, from about AR$4 million to over AR$100 million—growth that critics of Milei are now attributing to bribery, corruption, and favoritism.
But the audio recordings that catalyzed the scandal are not without their own irregularities. As they have been carefully edited to contain only the remarks of Spagnuolo, where and in what context they were recorded remains entirely unknown. Jorge Rial and Mauro Federico, the journalists who secured the recordings and released them on streaming channel Carnaval, have declined to indicate so much as when the recordings were made, only saying that they could be as much as a year old. The provenance of the recordings is also a mystery, leaving open the possibility that the recordings were deceptively edited, fabricated, or even created by Spagnuolo himself. There is little doubt that their release was timed to throw the libertarians into chaos just before the important provincial elections in Buenos Aires, which are widely viewed as a referendum on Milei’s administration.
The administration has responded by denying all of the allegations of bribery and asserting that the recordings are part of an operation by their Kirchnerist political opponents to derail the libertarians during upcoming elections. “It’s no coincidence that this type of ploy appears just two weeks before the elections in the province of Buenos Aires,” wrote Eduardo “Lule” Menem, who was accused in the recordings of being a recipient of Suizo Argentino’s bribes. “I never had any intervention of any kind with the contracts of ANDIS.”
“Everything [Spagnuolo] said is a lie,” Milei told reporters. “We are going to bring him to court and we are going to prove that he lied.”
Spagnuolo himself remains a wildcard in the whole affair. A lawyer by trade, Spagnuolo attracted Milei’s attention early in the president’s political career because of his vociferous social media account. According to a report by La Nación’s Hugo Alconada Mon, once they were introduced, they quickly became fast friends—“they lunched together, they travelled together, they dined together”—and Spagnuolo served as one of Milei’s lawyers in a number of lawsuits. Spagnuolo was one of the founding members of LLA, and the president repaid his affection by attempting to promote Spagnuolo’s political career alongside his own—with very dubious results. Milei attempted to sponsor Spagnuolo with over half a dozen prominent Argentine politicians; even relationships that began on a promising note flamed out. Would-be mentors spoke of his emotional fragility and difficulty handling stress.
After promises that Spagnuolo would serve as one of LLA’s deputies and as the general secretary of the House of Deputies fell through, Spagnuolo ended up at the head of ANDIS, a position for which he apparently has few qualifications. He remained close with Milei personally, visiting the president’s office and residence scores of times in 2024. But he seems to have grown deeply disillusioned with the rest of the libertarian administration. After the release of the bombshell recording, a number of other recordings of Spagnuolo surfaced—these contain no accusations of criminal behavior, only a long tirade of bitter insults at various figures within the government.
Whether Spaguolo’s accusations be true or false, a matter which may not be clear for many months, his disaffection has come at a steep price and a desperate time for Milei and the libertarians. The scandal strikes at the heart of Milei’s popular appeal: an end to la casta, Argentina’s corrupt political class that never feels the pinch of the economic distress they impose on the people. The impact is already being felt in the polls, where LLA has gone from the clear favorites over the Kirchnerist Peronists to competing on nearly equal footing.
The scandal has also given the opposition parties, who hold a clear majority in the legislature, a rallying point. On Thursday, the Argentine Congress took an ax to Milei’s project of fiscal discipline and overturned the president’s veto on a law that secured funding for disability pensions, the first time Congress has overturned a presidential veto in over 20 years—and a clear symbolic attack on the scandal rocking the national disability agency. More ominous for the president, the Senate approved a revision that would significantly curtail the presidential power to issue Decrees of Necessity and Urgency (DNU), instruments that allow the president to make, revise, or modify certain laws without the passage of legislation. Milei has made extensive use of DNUs during his time in government—a necessity given that LLA and its allies hold only a tiny minority in both houses of Congress.
The scandal threatens to turn the midterm elections, which Milei’s supporters believed would serve as a vindication of his record, into a rout.
“I believe we're seeing a very significant political operation against the government,” Fernando Pedrosa, a professor of political science at the University of Buenos Aires, told The American Conservative. “The entire political system seems to be involved in ensuring Milei loses the elections, both the ones happening in just a few days in the province of Buenos Aires and the ones in October.
“I’d even say there’s a sector that doesn’t want him to finish the year as president.”