MONGOLIA RATED “LARGELY COMPLIANT” IN AML/CFT EFFORTS

Ulaanbaatar, Mongolia - In a significant move, Mongolia has been rated “largely compliant” in its efforts to prevent money laundering and terrorist financing (AML/CFT) by the Financial Action Task Force (FATF).

Mongolia’s Progress in AML/CFT Efforts

The rating comes after Mongolia’s Financial Regulatory Commission (FRC) introduced a legal framework to regulate and monitor virtual assets and virtual asset service providers (VASPs). The new regulations require VASPs to:

• Register with the FRC
• Conduct customer due diligence
• Implement measures to prevent money laundering and terrorist financing

Under this framework, VASPs are required to:

• Report suspicious transactions
• Provide information on originators and beneficiaries of virtual asset transfers
• Mongolia has also implemented targeted financial sanctions against individuals and entities designated by the United Nations Security Council (UNSC) and the European Union (EU).

FATF’s Comprehensive Review

The FATF’s rating is based on a comprehensive review of Mongolia’s AML/CFT regime, which includes its laws, regulations, and implementation mechanisms. The report highlighted several areas where Mongolia has made significant progress, including:

• Introduction of a legal framework for virtual assets and VASPs
• Efforts to spread public awareness about the risks associated with virtual assets

Minor Deficiencies

However, the report also identified some minor deficiencies, including:

• Gaps in risk-based supervision of VASPs
• Need for more effective dissuasive monetary penalties for non-compliance

The FRC is expected to address these deficiencies by June 2022.

Mongolia’s Commitment to Combating Money Laundering and Terrorist Financing

Mongolia’s rating as “largely compliant” reflects the country’s commitment to combating money laundering and terrorist financing, and its efforts to strengthen its AML/CFT regime.