Public outrage is growing as an investigation digs into whether President Javier Milei’s sister, Karina Milei, accepted vast sums of cash in kickbacks from pharmaceutical sales to Argentina’s disability services agency.
The burgeoning corruption scandal made waves after leaked audio recordings linked Karina Milei, who serves as presidential chief-of-staff, to profiting from the country’s purchases of medicine for disabled people.
No charges have been brought in the matter, but the brother-sister duo’s motorcade was pelted with stones and bottles at a campaign event Wednesday.
Here are three key points about the campaign season scandal that’s keeping the Argentine populace in suspense ahead of provincial and national elections:
What is being investigated?
Leaked audio recordings are purported to reveal the former head of the ANDIS national disability agency, Diego Spagnuolo, saying Karina Milei allegedly collects three percent of his agency’s payments for medicine to pharmaceutical company Suizo Argentina.
“Karina gets three percent and one percent goes to the operation,” a voice alleged to be Spagnuolo says in the leaked recordings. He also claims to have informed the President about his sister’s alleged scheme.
“They take half a million or more per month,” the voice continues, apparently noting a monthly take of somewhere between US$500,000 and US$800,000.
The audio files were released on August 19 and the government removed Spagnulo from his position thereafter “in light of publicly known events.”
The alleged scheme also implicates Eduardo ‘Lule’ Menem, the nephew of former president Carlos Menem, who led Argentina from 1989 to 1999.
Federal judge Sebastian Casanello ordered 16 raids on Friday, including the home of one pharmacy owner, Jonathan Kovalivker, whose business partner and brother Emmanuel was caught attempting to flee police with US$266,000 in envelopes.
What the government says
Karina Milei – who her brother refers to as “El Jefe” or “The Boss” – has not made a public statement responding to the scandal despite topping headlines and triggering a flood of memes on social media.
On Wednesday, the president addressed the audio recordings, saying they belonged to Spagnuolo but told reporters “everything he says is a lie; we will take him to court and prove that he lied.”
The statement was made minutes before Milei was forced to evacuate a campaign rally after protesters hurled stones at the van he was traveling in.
Milei’s spokesperson took to X to call the allegations “political exploitation by the opposition during an election year.”
The national legislative elections on October 26 will put part of Congress on the ballot and test Milei’s popularity after wrangling inflation amid a severe austerity programme that demanded painful public spending cuts, including for those with disabilities.
Local legislative elections in Buenos Aires Province – which accounts for more than a third of the nation’s registered voters – will also be held in September.
Repercussions
Markets are responding negatively to the hubbub: the Buenos Aires Stock Exchange has dropped in recent days, the peso is under pressure against the dollar, and the country’s risk index – which measures the government’s borrowing cost in foreign currency – has surged.
The scandal comes just after Congress overruled Milei’s veto on a law declaring a disability emergency and allocating more funds to the sector – a major political blow to the president and his budget-slashing approach.
The pharmaceutical company, Suizo Argentina, issued a statement saying it acted “fully in compliance with current rules and laws” and vowed to work transparently with oversight agencies and government.
The Kovalivker brothers have not made any public statements, but local press reported that they handed over their mobile phones to the courts.
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