A scandal in Mongolia: heads roll in government after US$1.3m SME fund embezzlement
- Officials have channelled close to US$1.3m in government funds to family and friends
- The money was meant to be used for the country’s struggling SME sector
Mongolia’s anti-corruption authority is investigating reports that senior government officials and parliamentarians channelled more than US$1 million in government money to their families and friends, with one minister resigning last week and another expected to step down soon.
The money was from a fund set up 18 years ago to offer loans at 3 per cent interest to owners of small and medium-sized enterprises, as banks and finance companies normally charge between 12 and 30 per cent.
Some 65 billion Mongolian tugrik (US$25.4 million) was allocated to the fund in the 2018 budget.
However, starting two weeks ago it was revealed in reports leaked to the Ikon news website that some of the resource-rich country’s most powerful people have been using the fund to grant loans to their family members’ companies, or putting the money in high-interest bearing accounts.
Among the accused are government ministers, members of parliament, the general prosecutor, general auditor, and the former head of the intelligence authority.