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Apartments Claimed in Alleged Mining Money Laundering Scheme

US Prosecutors Seek Forfeiture of Luxury Properties Tied to Former Prime Minister

by Victor Adetimilehin

The United States is taking action against suspected money laundering involving luxury real estate in New York City. Prosecutors in Brooklyn are seeking to seize two Manhattan apartments allegedly purchased by a former Mongolian Prime Minister with embezzled funds from mining contracts.

Accusations of Corruption and Embezzlement

According to the prosecutors, Sukhbaatar Batbold, who served as Mongolia’s Prime Minister from 2009 to 2012, used profits from a corrupt mining deal to buy the apartments for a combined total of $14 million.  However, the funds are said to originate from a $68 million contract awarded in 2011 to a Hong Kong-registered company, Catrison Limited, for the purchase of copper concentrate from the massive Erdenet copper mine in Mongolia.

Prosecutors allege that Catrison Limited lacked any experience in the mining industry and was essentially a shell company controlled by Batbold through intermediaries. “Batbold used the proceeds from this illicit scheme to acquire high-end real estate, violating US federal law,” stated Breon Peace, the top federal prosecutor in Brooklyn.

Batbold, who currently holds a seat in the Mongolian parliament, has denied the allegations. Moreover, his lawyers claim he has no property holdings in New York City and that he intends to defend himself vigorously in court.

Focus on Combating Real Estate Money Laundering

The case highlights the growing concern over money laundering through the US real estate market. Also, the US Treasury Department estimates that illicit funds amounting to $2.3 billion were funneled through American real estate between 2015 and 2020. In February 2024, the Treasury Department proposed a comprehensive plan to combat this financial crime.

However, prosecutors allege that shell companies controlled by a member of Catrison’s board purchased a Manhattan apartment for $3.9 million in 2012. This apartment, located at the Park Imperial building on West 56th Street, reportedly served as the mailing address for Batbold’s son when he opened a US bank account the following year.

A second apartment, located at Carlton House on East 61st Street, was acquired in 2015 for $9.9 million by another company allegedly controlled by the same Catrison board member. Prosecutors claim Batbold’s son is listed as a co-owner of this property.

The US Attorney’s Office for the Eastern District of New York is pursuing the forfeiture of the two Manhattan apartments. The case underscores the ongoing efforts by US authorities to crack down on financial crimes and ensure transparency in the real estate market.

Source: Reuters

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