Prosecutor’s Office files case regarding SME loan controversy
Mongolian social media and news has recently been flooded with news and responses to the small to medium enterprise (SME) lending controversy. It surrounds several key politicians who have allegedly misused their power to funnel billions of MNT in SME financing to companies owned by family members and close associates. Now the Ulaanbaatar Prosecutor’s Office has filed a claim regarding the controversy and transferred the investigation to the Independent Authority Against Corruption (IAAC).
“The Ulaanbaatar Prosecutor’s Office has received information about the SME loan controversy that has been floating around social media. Subsequently, a case has been filed investigating claims that key state officials and politicians have committed abuse of power and misappropriation of state funds to give advantage or special privilege to their close associates. Within its full authority, the Prosecutor’s Office has opened an investigation and transferred the case to the IAAC,” the Prosecutor’s Office said in a statement.
In addition, the Prosecutor’s Office said that it will be closely monitoring the process of investigation regarding the case.
Looking at the previous system for SME lending, the SME Development Fund provided 745.5 billion MNT in lending from 2009 to 2016. Several of the politicians in question regarding the controversy have inadvertently admitted that family members have received SME loans but denied any special privilege. One politician in particular, MP Ya.Sodbaatar, the recently appointed Minister of Roads and Transportation, admitted when questioned by the media that his wife and her friends started a business and their company received an SME loan. This was confirmed by SME Development Fund official Sh.Sugar, who said that the company in question, Epato Anarvaan, did receive a loan.