Japan

New Documents

Japan’s Financial Services Agency published an English version of its monthly newsletter which highlights its recent activities and publications, as well as an address by the Minister of State for Financial Services at the 97th annual meeting of the Trust Companies Association of Japan. 

Japan’s Financial Services Agency published an English translation of the Frequently Asked Questions accompanying the guidelines on anti-money laundering and counterterrorism financing.

News

Enforcement Actions

Japan’s Financial Services Agency announced an administrative action brought by the Kanto Local Finance Bureau against the Tokyo-based payment services company for regulatory shortcomings.

Japan’s Financial Services Agency took administrative actions against Mizuho Bank, Ltd. and Mizuho Financial Group, Inc., ordering the institutions to strengthen governance procedures and certain anti-money laundering processes.


Important Facts

  • The U.S. State Department labels Japan as a jurisdiction of primary concern. Japan is a regional financial center, but not an offshore financial center. The country continues to face substantial risk of money laundering by organized crime, including Japan’s organized crime groups, Mexican drug trafficking organizations and other domestic and international criminal elements. Major sources of laundered funds include: drug trafficking, fraud, illegal money lending, remittance fraud, the black market economy, prostitution and illicit gambling. Bulk cash smuggling is also of concern. In the past several years, there has been an increase in financial crimes by citizens of West African countries, such as Nigeria and Ghana, who reside in Japan. There is not a significant black market for smuggled goods and the use of alternative remittance systems is believed to be limited.
  • KYC Covered Entities: Banks; credit, agricultural, and fishery cooperatives; insurance companies; securities firms; real estate agents and professionals; precious metals and stones dealers; antique dealers; postal service providers; lawyers; judicial scriveners; certified administrative procedures specialists; accountants; certified public tax accountants; and trust companies
  • STR Covered Entities: Banks; credit, agricultural, and fishery cooperatives; insurance companies; securities firms; trust companies; real estate agents and professionals; precious metals and stones dealers
  • Enhanced Due Diligence Procedures for PEPs: Foreign: Yes; Domestic: Yes
  • Money Laundering Criminal Prosecutions/Convictions: Prosecutions: N/A; Convictions: N/A
-Source: 2016 International Narcotics Control Strategy Report (INCSR)

Rankings

FATF i | 2013 Methodology

Technical Effectiveness
Compliant : 4 High : 0
Largely Compliant : 25 Substantial : 3
Partially Compliant : 9 Moderate : 8
Non-Compliant : 1 Low : 0
Not-Applicable : 1

Japan's technical compliance was re-rated in a Sept. 13, 2022, follow-up report.

BASEL i

Rank : 47/110
Score : 4.99/10

TRANSPARENCY INTERNATIONAL i

Rank : 19/179
Score : 74/100

Tax Justice Network i

Rank : 16/133
Score : 66/100