Ulaanbaatar, November 29, 2023 /MONTSAME.  Mongolia was put on FATF's gray list in October 2019 and ranked 20th in the Basel AML Index. However, according to the Basel Institute on Governance assessment in 2023, Mongolia's money laundering and terrorist financing (ML/TF) risk score has decreased and it ranks 83rd out of 152 countries.

The Basel AML Index provides risk scores based on the quality of a country's anti-money laundering and countering the financing of terrorism (AML/CFT) framework and the results are presented in the FATF Mutual Evaluation Report.

In recent years, Mongolia has made unprecedented progress in combating money laundering and terrorist financing. Mongolia is leading among the anti-money laundering groups in the Asia-Pacific region to be fully compliant and assessed as "compliant" and "largely compliant" on all 40 FATF technical recommendations. According to the Bank of Mongolia, the progress made by Mongolia will have a positive impact on other assessments and indexes for assessing the system of combating money laundering and terrorist financing, as well as cooperation with foreign banking and financial institutions.

The State Great Khural and the Cabinet's support to combat money laundering and terrorist financing at all levels as well as public and private organizations' prompt actions had a positive impact on FAFT assessment. The Bank of Mongolia emphasized the necessity to focus on the implementation and detection of crimes related to money laundering and terrorist financing, expanding cooperation, quality of preventive measures aimed at avoiding risks, and strengthening the capacity of human resources and funding of organizations operating in this area.

In the Basel AML Index, the risk is calculated using a special methodology, and the global average is estimated at 5.31. On this list, Haiti was ranked 1st as the country with the highest risk of money laundering and terrorist financing, while Iceland was ranked 152nd as the country with the lowest risk.

The Basel Institute on Governance is an independent not-for-profit organization dedicated to countering corruption, improving standards of governance and their activities, criminal law enforcement, combating money laundering and terrorist financing, confiscation, and return of illegal assets. It annually assesses risks of money laundering and terrorist financing around the world and publishes the Basel AML Index.

Since there is no single index that calculates money laundering and terrorist financing risk factors, countries, governments, and private organizations often use the Basel AML Index to develop their anti-money laundering and terrorist financing strategies and calculate risks.

The Basel Institute has been publishing the Basel AML Index annually since 2012. 

It provides risk scores based on data from 18 publicly available sources such as the Financial Action Task Force (FATF), Transparency International, the World Bank and the World Economic Forum.

The risk scores cover five domains considered to contribute to a high risk of ML/TF:

1.       Quality of AML/CFT Framework

2.       Bribery and Corruption

3.       Financial Transparency and Standards

4.       Public Transparency and Accountability

5.       Legal and Political Risks