Japanese police reported suspected money laundering cases linked to cryptocurrencies

7 years ago - Published in Finance, Fintech Land, Fiscal & Legal

Following new cryptocurrency regulations in April, Japanese police have pointed to 170 cases of money laundering via cryptocurrencies reported by exchange operators in six months between April and October.

The first such report by the National Police Agency was conducted after the law on prevention of transfer of criminal proceeds was revised in April, requiring cryptocurrency exchange operators to report transactions suspected to be involved in money laundering.

The exchange operators are believed to have reported cases that involved frequent questionable transactions. After analyzing the cases, the agency said it has provided information to relevant investigative authorities.

The regulations kicked in alongside new legislation that now sees bitcoin recognized as a legal method of payment in Japan. At present, 11 cryptocurrency exchange operators are registered under the new law after earning regulatory licensure by Japan’s financial regulator. The number of users is expected to rise if these cryptocurrencies attract more attention.

“We want to take countermeasures by collaborating with relevant ministries and agencies as well as business operators,” an NPA official said. Meanwhile, the agency report also examined suspected money laundering cases reported by banks and insurance companies in the three years to 2016.

The number of suspected cases totaled 1,178,112, of which 190,298 cases, or 16.2 percent, were linked with members of organized crime syndicates.

Further, money laundering through gold and precious metals threw up 42 suspected cases. Current tariff laws impose an upper limit of ¥5 million ($44,000). Japan’s finance ministry is reportedly working on lifting that upper limit up to five times the value of the smuggled goods, next year.

The ministry intends to lift the limit, in principle, to ¥10 million. But if the value of smuggled gold exceeds ¥2 million, fines up to five times the value will be imposed. For instance, if a ¥100 million gold bar is smuggled, a fine of up to ¥500 million will be imposed. The ministry plans to introduce necessary legislation next year for early implementation.