Is Argentina About To Go Out of Business (Again)?

The Argentina Government has stopped HSBC Argentina from transferring money abroad, for 30 days.  See the Reuters and the Fox Latino articles.  The Central Bank stated the reason for such a drastic action is HSBC's lack of ability to correctly document such transfers.  The Argentina revenue authority has also recently raided HSBC's offices, accusing it of assisting Argentina's wealthy comit tax evasion through Swiss accounts.

Yet, one cannot help but ponder whether this is an isolated move against a bad actor, authorized by the requisite legislation and pursuant to due process, or whether this is politically motivated for other reasons?  

Argentina ranked in the bottom half of countries for corruption (107 of 175 countries ranked by Transparency International, scoring only 34 points of 100 possible transparency points). Just last month an American company entered into a nonprosecution agreement for bribery of the Governor's office of Argentina's San Juan province (see article). 

Last summer, S&P downgraded Argentina (see article) to selective default on its foreign currency bonds.

Presidential elections are set for October and campaigning is underway to decide whether the Kirchner regime, after 12 years, will continue (see article).  Banks make a popular Populist scapegoat.  

Yet, some banks have proven to be bad actors when it comes to conspiring with private clients to commit tax evasion.  Such opaque tactics are part of the environment that allows the proceeds of corruption to be enjoyed by the corrupt government officials, encouraging further acts of corruption.

So - is Argentina's drastic action against HSBC caused by the legitimate frustration of a fiscal authority trying to stem tax evasion and corruption?  Is it a smoke screen to divert a public's attention from fundamental economic challenges ?  Is it punishment for something other than what has been publicly stated ?    Let me know what you, the reader, thinks?