Financial Crime World

Japan Makes Progress in Anti-Money Laundering and Counter-Terrorist Financing Efforts

Japan Strengthens Measures to Combat Money Laundering and Terrorist Financing

TOKYO, JAPAN - In a significant development, Japan has made substantial progress in enhancing its measures to combat money laundering and terrorist financing, according to the latest report by the Financial Action Task Force (FATF).

Report Highlights Progress

The report, released on September 2022, indicates that Japan has largely addressed most of the technical compliance deficiencies identified in its previous assessment. As a result, Recommendation 2, which was previously rated “Partially Compliant” (PC), has been upgraded to “Largely Compliant” (LC).

Improvements in National Cooperation and Coordination Framework

Japan’s efforts to improve its national cooperation and coordination framework have been highlighted in the report. The country has established an Inter-Ministerial Council for AML/CTF/CPF Policy, which has developed a new National AML/CFT/CPF Action Plan.

The action plan includes measures to:

  • Strengthen the enforcement of asset freezing measures
  • Implement legislative reforms
  • Develop a national policy informed by risk assessments

Progress in Addressing Deficiencies

Japan has also made progress in addressing deficiencies related to data protection, including the establishment of a task force to promote strengthening of terrorist financing investigation and prosecution.

Additionally, the country has:

  • Enhanced its implementation of asset freezing measures
  • Developed policies to prevent non-profit organizations from being exploited for terrorism financing

Minor Gaps Remain

While some minor gaps remain, including the unclear mandate of the Inter-Ministerial Council, Japan’s overall progress has been recognized by the FATF.

Quote

“This is a significant step forward for Japan in its efforts to combat money laundering and terrorist financing,” said Mr. Michele Antonio Bozza Venturi, AML/ CFT Financial Advisor at the Bank of Italy. “The country’s commitment to implementing robust AML/CFT measures demonstrates its determination to address these critical issues.”

Accessing the Report

The FATF report is available on the organization’s website at www.fatf-gafi.org.