Financial Crime World

Financial Intelligence Unit Roles in Japan: Understanding the Role of JAFIC

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The Japan Financial Intelligence Center (JAFIC) has been a leading force in combating money laundering and terrorist financing since its establishment in 2007. As a key institution within the National Police Agency, JAFIC plays a crucial role in collecting, analyzing, and disseminating suspicious transaction reports (STRs) to law enforcement agencies and other relevant authorities.

Role and Responsibilities of JAFIC

According to Egmont Group, an international organization of financial intelligence units (FIUs), JAFIC is responsible for:

  • Receiving, analyzing, and disseminating financial information related to suspected proceeds of crime and potential financing of terrorism
  • Collecting, arranging, analyzing, and disseminating STRs filed by specified business operators
  • Handling information dissemination to foreign FIUs
  • Providing complementary supervisory measures to ensure that reporting entities take required anti-money laundering (AML) measures

History of JAFIC

The concept of a financial intelligence unit was first introduced in Japan in 2000 with the establishment of a similar institution within the Financial Supervisory Agency. However, it wasn’t until the Act on Prevention of Transfer of Criminal Proceeds came into force in 2007 that JAFIC was re-established under the National Police Agency.

Expansion of Reporting Entities

The new law expanded the scope of reporting entities to include non-financial institutions such as:

  • Real estate agents
  • Dealers in precious metals and stones

This move aimed to make the most of reported information for investigation or countermeasures against organized crime and terrorism.

JAFIC’s Mission

JAFIC’s mission includes:

  • Planning and examining legal systems related to AML/CFT
  • Participating in international discussions on AML standards

Structure and Staffing

JAFIC is composed of around 90 staff members under the Director for Prevention of Money Laundering, making it a significant player in Japan’s efforts to combat financial crime.

Conclusion

In conclusion, JAFIC plays a vital role in Japan’s fight against money laundering and terrorist financing. Its unique structure and responsibilities make it an essential institution in the country’s financial intelligence landscape.