BUENOS AIRES, Argentina (AP) — Argentina wants the U.S. Securities and Exchange Commission to name names and provide proof that Ralph Lauren Corp. bribed customs officials for years to allow its products into the South American country.
Tax chief Ricardo Echegary came out swinging Tuesday after the U.S. government announced that the designer label had cooperated with authorities and paid a fine of nearly $1.6 million after admitting that its now-closed Argentine subsidiary violated the U.S. Foreign Corrupt Practices Act.
Echegaray blamed private customs brokers and former Ralph Lauren executives for any violations, and suspended their tax ID numbers, which are necessary to do business legally in Argentina.
But he also demanded that the S.E.C. identify which Argentine officials allegedly took the bribes, which the SEC said totaled nearly $600,000 over four years until they were discovered in 2010. And his agency put out a statement that called it a lie designed to cover up how Ralph Lauren emptied the subsidiary before abandoning Argentina.
Echegaray’s AFIP tax agency also launched a criminal investigation on Monday after the S.E.C. announced the settlement in New York, and he asked U.S. Ambassador Vilma Martinez to intervene so that any evidence can be shared with investigative Jorge Brugo, who was assigned the Argentine case.
The Embassy on Tuesday referred all questions to the SEC and the Justice Department, which had no immediate comment on Echegaray’s requests and allegations.
The SEC said Ralph Lauren Corp. spent $593,000 in bribes from 2005 to 2009 through customs agents who were able to get its products into Argentina without the necessary paperwork. The company agreed to give up more than $700,000 in illegal profits and pay a penalty of $882,000 to settle the claims, which it blamed on its subsidiary.
Echegaray’s initial reaction was to blame U.S. officials for failing to share information, and accuse the company of inventing the bribery claims to cover up the disappearance of $567,000 in local assets. An agency statement said the U.S. embassy failed to share any information, despite cooperation agreements between the countries.
The New York-based company said it reported the irregularities promptly to the S.E.C. after discovering them in 2010, fired the responsible employees and closed its offices and stores in Argentina.
Economic analysts blamed Ralph Lauren’s closure last year on import hurdles and currency controls that kept it from getting its products in and its profits out. Others made similar complaints as they abandoned Argentina, an exodus of designer labels that included Emporio Armani, Yves Saint Laurent, Escada, Calvin Klein Underwear, Louis Vuitton, Kenzo and Cartier.
Argentina’s policies are aimed at forcing multinational corporations to foster domestic production and invest their profits inside the country. A series of ever-changing, unpublished rules have enabled bureaucrats to hold up import licenses until businesses promise to match their cargo’s value by shifting an equal amount of production or investment to Argentina.