Financial Crimes and Terrorism Funding in Mongolia: A Growing Concern

Mongolia, a country with a growing economy, is facing increasing concerns over financial crimes and terrorism funding. Despite making significant progress in implementing measures to combat money laundering and terrorist financing, there are still areas of concern.

Assessing Risk and Applying a Risk-Based Approach

Mongolia has been found partially compliant with FATF Recommendation R.1, which requires countries to assess the risk of money laundering and terrorist financing and apply a risk-based approach to combating these crimes. While Mongolia has taken steps to identify high-risk sectors and individuals, its risk assessment process is not yet fully comprehensive.

National Cooperation and Coordination

Mongolia has been found partially compliant with FATF Recommendation R.2, which requires countries to establish effective national cooperation and coordination mechanisms to combat money laundering and terrorist financing. While Mongolia has established various agencies to deal with financial crimes, there are concerns over the effectiveness of its coordination mechanisms.

Money Laundering Offence

Mongolia has been found largely compliant with FATF Recommendation R.3, which requires countries to criminalize money laundering. However, there are concerns over the country’s ability to detect and prosecute complex money laundering schemes.

Confiscation and Provisional Measures

Mongolia has been found largely compliant with FATF Recommendation R.4, which requires countries to establish confiscation and provisional measures to combat money laundering and terrorist financing. While Mongolia has established laws and regulations governing the confiscation of assets linked to financial crimes, there are concerns over the effectiveness of its enforcement mechanisms.

Terrorist Financing Offence

Mongolia has been found largely compliant with FATF Recommendation R.5, which requires countries to criminalize terrorist financing. However, there are concerns over the country’s ability to detect and prosecute complex terrorist financing schemes.

Mongolia has been found partially compliant with FATF Recommendation R.6, which requires countries to establish targeted financial sanctions related to terrorism and terrorist financing. While Mongolia has established a sanctions regime, there are concerns over the effectiveness of its enforcement mechanisms.

Conclusion

These findings have significant implications for Mongolia’s efforts to combat financial crimes and terrorism funding. The country must take immediate action to address these shortcomings and ensure that its financial system is not exploited by criminals and terrorists.