Argentina’s libertarian president goes on defence as a corruption scandal spreads

Argentine President Javier Milei and his sister, Secretary General of the Presidency, Karina Milei attend a campaign rally ahead of legislative provincial elections in Lomas de Zamora, Argentina, Wednesday, Aug. 27, 2025. (AP Photo/Natacha Pisarenko)

BUENOS AIRES, Argentina — President Javier Milei of Argentina on Thursday fired back at his political opponents and defended his influential sister against claims that she and other close associates profited from a bribery scheme within the country’s disability agency.

In his first major remarks on the corruption scandal, Milei accused his rivals of orchestrating a smear campaign against him and his libertarian party.

“This week’s operation is nothing more than another item in the long list of schemes by the ‘caste,’” Milei told business leaders at a trade conference, using his preferred term for Argentina’s left-leaning Peronist opposition that has dominated politics for decades. “Like all previous schemes, it’s another lie.”

The crisis swirling around the government has put Milei on the defensive and threatens to sap popular support for his party just as the political manoeuvring is heating up in advance of two key electoral challenges.

Argentina’s most populous province of Buenos Aires — a long-standing stronghold of Milei’s Peronist rivals — will elect local councils and provincial lawmakers on Sept. 7. In October, the country holds national midterm elections in which Milei seeks to expand his party’s minority in the opposition-controlled Congress.

Both votes are widely seen as a referendum on the self-proclaimed “anarcho-capitalist,” who has won praise for eliminating Argentina’s chronic fiscal deficit and taming severe inflation but faces growing pressures as economic growth sputters, foreign currency reserves dwindle and average salaries lag behind pre-Milei levels.

The corruption scandal erupted last week when local media published leaked audio messages in which the former director of Argentina’s disability agency, Diego Spagnuolo, can allegedly be heard discussing a kickback scheme in his organization benefiting the president’s sister and closest adviser, Karina Milei, and other senior officials to the tune of up to US$800,000 a month.

Milei fired Spagnuolo from the disability agency after publication of the audio messages. Authorities are investigating the recordings and raided several homes and offices across Buenos Aires. Prosecutors have not yet filed charges.

“We regret that judges have to waste their time on the most rancid political tricks instead of pursuing crime,” Milei said on Thursday.

The president first broke days of an unusual silence on the issue Wednesday, denying the allegations to a reporter during a campaign event shortly before being evacuated as protesters hurled stones at his motorcade.

Another campaign event featuring Karina Milei grew tense on Thursday when protesters thronged the street, shoving and shouting insults at pro-Milei supporters. Again, Karina Milei was whisked off in a black van away from the crowds. Police reported at least three arrests.

The Associated Press