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Anti-Money Laundering (AML) and Know Your Customer (KYC) Regulations in Japan

Key Takeaways

Japan has strict Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations that businesses must comply with. Here are the key takeaways to ensure regulatory compliance:

Identification Documents

The following documents are considered proof of address for AML and KYC purposes in Japan:

• Current Utility Bill: Gas, electricity, telephone, or mobile phone bill
• Government-Issued Document: Document issued by a government department showing the End-user’s address and name
• Bank Statement: Bank statement (no older than 3 months) showing the End-user’s address and name

Timing of Verification

Identity verification is not limited to a one-time process but is required in multiple instances as per regulations. This ensures that businesses remain vigilant against money laundering and other financial crimes.

Politically Exposed Persons (PEPs)

Businesses must determine if their customers are PEPs, hold public office, or exhibit a higher risk profile. Shufti Pro provides AML Screening services to help with this obligation.

Reliance on External Services

While clients may seek the services of a third-party for fulfilling AML/KYC obligations, they will remain liable for maintaining regulatory compliance and fulfilling AML and KYC obligations.

Record Retention

Businesses are required to retain data for not less than 7 years as part of their AML and KYC obligations for due diligence. This ensures that businesses can demonstrate compliance with regulations and provide necessary information to authorities upon request.

Important Note

AML and KYC regulations in Japan are subject to change, so it’s essential to consult the latest versions of the Japanese regulations and guidelines related to AML/KYC to ensure continued regulatory compliance.