"misleading accusations": The official statement from dLocal after the accusation of fraud by the Argentine government

“Today we have been the subject of a series of misleading accusations in an article published by Infobae, which has not contacted the company for comment, about the alleged breach of expatriation regulations in Argentina. DLocal operates in the industry of payments and is regulated by government authorities in its 40 geographies. The article in question is incorrect,” states the dLocal statement to which he accessed The Observer and proceeds to clarify three points

First, it argues that dLocal processes payments for global merchants. “Our activities are subject to specific government regulations for each currency that is exchanged”, says the statement and explains that, in Argentina, the expatriation of funds is carried out through “regulated parties that follow the rules of the Central Bank of Argentina” and that contain detailed information on payment transactions. “Expatriate funds from Argentina are liquidated to global merchants, net of taxes,” says the statement from the first Uruguayan company to list on Wall Street.

Secondly, he points out that as part of their daily activities they are “in close contact with the authorities and there is a continuous flow of information”. “To the extent that we are notified by the authorities of Argentina (or any other country), we significantly engage and cooperate with any request from regulatory authorities. As of today, we have not been notified by any Argentine authority in connection with a foreign exchange investigation,” the document states.

Finally, it indicates that payments continue to be processed normally in Argentina. “We have been operating in the country since 2016 and have a strong local presence with more than 150 employees spread across numerous offices.”

We will maintain our focus on delivering outstanding service and results for our clients, shareholders and other stakeholders. We will not be distracted by misleading accusations. DLocal is committed to the integrity of all its business activities and will continue to focus on providing the best and most comprehensive solution for our global merchants in each market in which we operate,” the statement from the Uruguayan unicorn stated.

The investigation

The Argentine government is conducting an investigation into dLocal, the only unicorn company in Uruguay, for alleged fraud against the Argentine Stateand is considering filing a complaint in the United States, reported Infobae and confirmed The Observer. In addition, Argentine Customs, which is carrying out the investigation, is evaluating notifying the Securities and Exchange Commission (SEC), the Wall Street regulator, and will seek to obtain information from the United States Treasury and Homeland Security Investigations on the whereabouts of at least US$ 400 million that the company allegedly “leaked” abroad.

According to Infobae, the investigated maneuver is to take advantage of the exchange gap to withdraw dollars abroad with operations not reflected in the accounting. It is noted that in its balance sheet it practically “does not have” fixed assets, and only declares rents that supposedly belong to the “domicile of its exploitation”. In addition, it is stated that dLocal receives invoices from abroad from its parent company, issues B invoices to foreign clients to justify income, and invoices companies in the same group. These practices would allow you to avoid the obligation to settle foreign currency from the export of services.

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