Mongolia pardons American, 2 Filipinos in tax case seen harming country's investment climate

Mongolia's president says he has pardoned an American mining executive and two Filipinos sentenced to jail for tax evasion in a case that raised questions about the Asian nation's reputation as an investment destination.

A statement Thursday from Elbegdorj Tsakhia's office said Justin Kapla, Hillarion Cajucom Jr. and Cristobal David would have the rest of their sentences of five to six years commuted.

Kapla is president and executive director of SouthGobi Sands LLC, a Mongolian mining company. Cajucom and David were financial experts with the firm.

The three were convicted and sentenced last month following a three-year investigation.

A U.S. Embassy statement said it understood the three were now free to leave Mongolia.

Mining-dependent Mongolia badly needs foreign direct investment in the face of a deteriorating economic downturn.