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The Federal Supreme Court of Switzerland has upheld the seizure of USD 1.85 million held in Swiss bank accounts with connections to a former Mongolian Minister of Finance. The seized accounts are alleged to have sent 10 million USD in illegal payments to the former Minister.
The seizure stems from an investigation by the Mongolian anti-corruption agency, the “Independent Authority Against Corruption” regarding potential abuse of power by officials during the negotiation of the Investment Agreement signed in 2009 with a company managing major mining operation.
The Swiss Office of the Attorney General (OAG) alleges that 10.1 million USD was wired to the former Minster in the same month he was appointed Minister of Finance. The allegations include speculation that this minister signed the Investment Agreement which is “disadvantageous” for Mongolia.
Though allegations of unsavory backroom dealings regarding the Investment Agreement are known, there is no indication at this point that the agreement is at risk of being terminated prematurely. The suspected former Minister was forced to resign from public office after the offshore holdings were revealed with the 2016 release of the Panama Papers.
While nothing is proven thus far, the story puts the focus on Mongolian Anti-corruption laws, which are relatively lax when compared to many countries around the world. It may be that as this story develops there will be greater internal pressure within Mongolia for a stricter revision to the current anti-corruption law in Mongolia.