Financial Crime World

FATF Shifts Focus to Non-Financial Sectors in Fight Against Money Laundering

The Financial Action Task Force (FATF) has recently placed increased emphasis on identifying and tackling money laundering activities through non-financial sectors, reflecting the evolving nature of money laundering.

Evolving Nature of Money Laundering

Money laundering is becoming increasingly sophisticated and widespread. The FATF has revised its 40 Recommendations to include a broader range of operators required to implement customer identification and reporting measures.

Anti-Money Laundering Measures in Japan

Japan’s anti-money laundering measures have undergone significant developments in recent years. Key milestones include:

  • 1992: Enforcement of the Anti-Drug Special Provisions Law
    • Criminalized money laundering activities connected to drug crimes for the first time in the country
  • 2000: Act on Punishment of Organized Crimes
    • Expanded the scope of predicate offences and introduced a suspicious transaction reporting system
    • Designated the Financial Services Agency as Japan’s Financial Intelligence Unit (FIU)
  • 2002: Act on Punishment of Financing of Offences of Public Intimidation
    • Included terrorism-related offences within the scope of predicate crimes
    • Introduced new reporting requirements for financial institutions
  • January 2003: Customer Identification Act
    • Implemented customer identification regime required under international conventions and FATF Recommendations
  • December 2004: Revision of the Customer Identification Act
    • Addressed issues related to “Furikome” fraud, a type of bank account abuse
  • March 2007: Act on Prevention of Transfer of Criminal Proceeds
    • Implemented the re-revised FATF Recommendations
    • Extended the scope of business operators required to implement customer identification and reporting measures beyond financial institutions
  • April 2011-2013: Amendments to the Act on Prevention of Transfer of Criminal Proceeds
    • Addressed flaws identified during Japan’s third FATF mutual evaluation

Ongoing Challenges and Future Directions

The evolution of anti-money laundering measures reflects the ongoing challenges faced by countries in this area. As money laundering tactics continue to adapt and evolve, it is crucial for governments and financial institutions to stay ahead of the curve and implement effective measures to combat these crimes.