Financial Crime World

Mongolia’s Battle Against Financial Crimes: National Risk Assessment Reveals Threats and Vulnerabilities

Key Findings from Mongolia’s National Risk Assessment

Ulaanbaatar, Mongolia - In a proactive move to strengthen its financial system against money laundering and terrorist financing, Mongolia recently conducted its first national risk assessment. The comprehensive report identifies key threats, vulnerabilities, and consequences in various sectors, offering insights into the strategic steps the country intends to take to mitigate these risks.

  • Between 2010 and 2015, fraud was the most significant crime in terms of economic damage.
  • Incompletely filed or unreported cases of corruption, environmental crimes, tax evasion, and narcotic crimes present a significant challenge.

Exposed Sectors to Money Laundering

Banking Sector

  • Predominance of foreign investment.
  • Increased mining activities.

Real Estate Sector

  • Substantial volume of transactions.
  • Lack of centralized control.
  • Limited role of brokers in handling cash for purchases.

Financial Industry’s Response to Fighting Financial Crimes

  • Stringent customer classification.
  • Risk assessment and mitigation strategies.
  • Focus on border cash transportation for money laundering.

Vulnerabilities in Mongolia’s Financial Sector

  • Challenge of centralized control due to a small number of financial institutions.
  • Moderate money laundering risk for designated non-financial institutions and professions.

Mongolia’s Geographical Location and Risks

  • Neighbors and major trade partners, China, Russia, and South Korea, pose the highest risk as entry points.

Strategic Plan to Combat Money Laundering and Terrorist Financing

  • Enhance law enforcement institutions.
  • Develop and amend legislations.
  • Improve international cooperation through APG and FATF.
  • Increase public awareness and education regarding financial crimes.

Mongolia’s national risk assessment serves as the foundation for its strategic plan to mitigate money laundering and terrorist financing risks. This approach ensures a resilient financial system capable of navigating global challenges.