Title: Mongolia’s Anti-Money Laundering Regulations: A Closer Look at the Amended Law
Subtitle: Combatting Money Laundering and Terrorism Financing in Mongolia
Amended version as of 11 April 2022
In an effort to strengthen its stance against money laundering and terrorism financing, Mongolia’s parliament has recently amended the Law on Combating Money Laundering and Terrorism Financing. In this article, we delve into the key provisions of this law.
Key Provisions of Mongolia’s Anti-Money Laundering and Terrorism Financing Law
1. Purpose of the Law
Article 1 of the law states that its purpose is to prevent and legalize the basis for combating money laundering and terrorism financing in Mongolia.
2. Scope and Legislation
This law encompasses measures for proliferation financing and applies to both domestic and foreign transactions (Article 21). It is consistent with Mongolia’s Constitution, Criminal Code, and other relevant legal acts (Article 2).
3. Definitions
Key terms used in the law, such as money laundering, terrorism financing, cash transactions, and non-cash transactions, are defined in Article 3.
4. Reporting Entities
The following entities are mandated to report transactions to the Financial Information Unit (FIU):
- Banks
- Non-bank financial institutions
- Insurance companies
- Investment funds
- Licensed securities market entities
- Saving and credit cooperatives
- Real estate brokers
- Dealers of precious metals, precious stones, and jewelers
- Notaries
- Lawyers
- Accountants
- Other financial management counselors
(Article 4)
5. Preventative Measures
Entities subject to reporting must assess risks and have the authority to identify beneficial owners (Articles 41 and 51). They must also conduct customer due diligence procedures based on reliable sources of information (Article 5).
6. Enhanced Monitoring and Implementation of Sanctions
Entities are expected to monitor transactions to prevent money laundering and terrorism financing and must implement sanctions issued by international authorities (Article 61). Failure to comply with these regulations may result in civil, criminal, and other liabilities for the reporting entities and their employees (Article 12).
7. Record Keeping and Reporting
Entities must retain records of transactions, accounts, and customer information for at least five years (Article 8). Any suspicious transactions or transactions related to money laundering or terrorism financing must be reported to the FIU within 24 hours (Article 7).
Conclusion
These amendments to Mongolia’s anti-money laundering and terrorism financing regulations aim to enhance the country’s efforts in preventing and combating these illegal activities. The FIU plays a crucial role in receiving, analyzing, and disseminating information to competent law enforcement authorities, making it an essential component of Mongolia’s financial crime prevention measures.