Financial Crime World

Financial Crimes Investigation Techniques in Mongolia: A National Risk Assessment Reveals Key Findings

Mongolia has conducted its first national risk assessment to identify the risks associated with money laundering and terrorism financing, aiming to combat these financial crimes and prevent them from undermining the country’s stability and security.

Background

As a member of the Asia Pacific Group on Money Laundering (APG), Mongolia is committed to international efforts to prevent and detect money laundering and terrorism financing. The assessment aimed to identify risks in the country, analyze its economic situation, relevant regulations, institutional framework, and risks in banks and other financial sectors.

Key Findings

The national risk assessment revealed several key findings that highlight the need for a comprehensive strategy to address these risks:

  • Economic Risks: Mongolia’s economy relies heavily on mining and natural resources, which amplifies money laundering risks due to foreign investment. A large shadow economy and prevalence of crimes also contribute to these risks.
  • Fraud and Environmental Crimes: Fraud, crimes against the environment, tax evasion, and corruption pose significant risks, while hidden crimes such as bribery and environmental crimes are a concern.
  • Organized Crime Groups: Organized crime groups and their proceeds are potential dangers that require attention.
  • Banks and Financial Sectors: Risks were identified in banks and other financial sectors, including changes in bank management and capital, internal structures, and supervision structures.

Designated Non-Financial Businesses and Professions (DNFBPs)

Notary services, accounting, auditing, and real estate intermediaries were identified as DNFBPs with moderate risk. These sectors require special attention to prevent money laundering and terrorism financing.

Recommendations

The assessment provides valuable insights into the financial crimes investigation techniques needed to combat money laundering and terrorism financing in Mongolia. To address these risks, the country needs:

  • A comprehensive strategy to address money laundering and terrorism financing risks
  • Focus on high-risk sectors and geographic locations
  • Strengthen its commitment to international countermeasures ahead of the upcoming APG mutual evaluation

Conclusion

The national risk assessment provides a valuable roadmap for Mongolia to combat money laundering and terrorism financing. By addressing these risks, the country can better prevent and detect these crimes, maintaining stability and security for its citizens.