Japan Reinforces AML/CFT Measures Amid FATF Review

Tokyo, December 21, 2021

The Japanese government has taken a series of measures to strengthen anti-money laundering (AML) and combating the financing of terrorism (CFT) regulations for financial institutions and virtual currency exchange providers. This move comes after the Financial Action Task Force (FATF) published its Fourth Round Mutual Evaluation Report on Japan in August 2021.

Measures to Reinforce AML/CFT Regulations

The Japanese government has pledged to reinforce AML/CFT measures by:

• Financial Institutions (FIs): Strengthening supervision of AML/CFT measures taken by FIs, including on-site inspections, by autumn 2022.
• Virtual Currency Exchange Providers (VCEPs): Enhancing FI’s and VCEP’s understanding of risks and ensuring appropriate risk assessments by autumn 2022.
• Ongoing Customer Due Diligence: Fully implementing ongoing customer due diligence by spring 2024.
• Transaction Screening and Monitoring: Operationalizing a new shared IT platform for transaction screening and monitoring by spring 2024.

Revised Guidelines and FAQs

The Financial Services Agency (FSA) has revised its “Guidelines for Anti-Money Laundering and Combating the Financing of Terrorism” in:

• February 2021
• July 2021
• November 2021

Additionally, the agency issued Frequently Asked Questions (FAQs) on the guidelines in March 2021.

Contact Information

For further inquiries, please contact the FSA’s International Affairs Office at: +81-(0)3-3506-6000