Argentine President Cristina Fernandez de Kirchner is toughening controls over foreign exchange houses in a bid to stem capital flight that is draining reserves at the nation’s central bank.
Tax agency officials visited Buenos Aires exchange houses today, telling people seeking to buy as little as $100 to fill out currency exchange forms and provide identification and proof of income. Jose Sbattella, head of Argentina’s anti-money laundering agency, said the government is trying to crack down on investors who use other people to buy dollars for them.
“There is no reason for people to hide themselves if they are buying dollars and want to get them out of Argentina in a legal manner,” Sbattella said in an interview today on Radio Del Plata. More “transparency” is needed in the foreign currency market, he added.
The heightened supervision comes as Fernandez, who won re- election on Oct. 23, seeks to slow capital flight estimated at $3 billion per month that is draining central bank savings. Banco Central de la Republica Argentina sold $2.7 billion of reserves in August and September to stem a depreciation in the peso, which has weakened 6.1 percent this year, compared with a drop of 5.6 percent by the Brazilian real.
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