Ulaanbaatar /MONTSAME/. In compliance with the Law on Anti Money Laundering and Combatting the Financing of Terrorism, the Financial Regulatory Commission (FRC) conducts risk-based supervision on the fulfilment of individuals’ responsibilities for reporting. 

In this context, the Risk Assessment Questionnaire for Money Laundering, Terrorism Financing, and the Proliferation of Weapons of Mass Destruction is conducted electronically every six months.  The objectives are to, evaluate and analyze the reporting entity's risks, enforce off-site monitoring, determine the scope of inspections, update the risk vulnerability assessment, and assess the sector's overall level.

However, there are some weaknesses, such as, respondents’ failure to complete the questionnaire on time, provision of incomplete information (or failure to answer the questionnaire at all), and failure to provide appropriate information.

These failings provide grounds for the individual to be considered as not meeting his/her responsibilities under the Law on Anti Money Laundering and Combatting the Financing of Terrorism. And it exposes those concerned to a high risk of money laundering and/or the financing of terrorist. This is an indicator of a reporting entity's lack of ambition, and/or participation in combating money laundering and the financing of terrorism.

Accordingly, the Commission warns that those who fail to comply with their responsibilities (under the Law on Anti Money Laundering and Combatting the Financing of Terrorism) to supply information requested by the FRC in a timely manner, will be held liable under the following legislation:

Section 23.2.3 of the Law on Anti Money Laundering and Combatting the Financing of Terrorism, providing for the suspension, restriction (partially or complete), termination, suspension or revocation of entities’ licenses, as specified in Paragraph 4.1.

Paragraph 11.29 of the Law on Infringement, ‘Obstructing the implementation of the activities specified in the law on obtaining documents, reports, information and explanations in order to ensure and monitor the implementation of the legal obligations of the reporting entity, failed to comply with legal requirements, called for non-compliance. If a person fails to provide information in a timely manner or tries to interfere, he / she shall be fined MNT 3,000 and a legal entity shall be fined MNT 30,000 for damages and compensation.

The FRC firmly advises legal entities - in charge of reporting - to adhere strictly to the Law on Anti Money Laundering and Combatting the Financing of Terrorism, other relevant laws, and the Commission's obligations.