Financial Crime World

Mongolia’s Anti-Money Laundering and Counter-Terrorist Financing Landscape: APG Evaluation

Subtitle: Key Findings and Recommendations from the Asia/Pacific Group’s 2017 Report

The Asia/Pacific Group on Money Laundering (APG) conducted an evaluation of Mongolia’s anti-money laundering (AML) and counter-terrorist financing (CTF) landscape and released a mutual evaluation report in July 2017. In this article, we discuss the key findings and recommendations of the APG report.

Mongolia’s AML/CTF Landscape

The APG report assessed various aspects of Mongolia’s financial crime prevention measures, including risk assessment, coordination, legal frameworks, financial intelligence, and preventive measures.

Key Findings

  1. Money laundering (ML) and terrorism financing (TF) risks
  • Mongolia faces a diverse range of ML risks from various crimes, such as fraud, environmental crimes, tax evasion, and corruption.
  • Moderate-risk threats include drug offenses and organized crime.
  • Proceeds from these crimes are laundered both domestically and offshore.
  1. Minimal TF risk
  • Mongolia’s TF risk is low with no reported instances of terror groups like Al-Qaeda, Taliban, or ISIL.
  • Vulnerabilities include limited expertise, significant legal framework gaps, lack of oversight in the NPO sector, insufficient implementation in the non-bank sector, and no implementation in DNFBPs.
  1. Effectiveness and technical compliance
  • Mongolia has completed its first ML/TF National Risk Assessment (NRA) but faces significant gaps in its framework, particularly regarding DNFBPs, international cooperation, and the lack of coordination on proliferation financing.
  • Minimal awareness and compliance with AML/CTF obligations exist in both the banking and non-bank sectors.

APG’s Recommendations

The APG report contains 40 recommendations to strengthen Mongolia’s AML/CTF framework. Some critical areas of improvement include:

  • Assessing risks and applying a risk-based approach
  • Enhancing national and international cooperation
  • Enforcing targeted financial sanctions related to terrorism and proliferation
  • Implementing AML/CTF supervision of DNFBPs

For the complete APG report, please visit their website.