102023

October

Financial Services Agency
Newsletter

AccessFSA

No.242Monthlymagazine

Provisional
Translation

Contents
Conferences (P1- )P1 Appointment of New State Minister and Parliamentary Vice-Minister
P2 National Securities Conference 2023
– Speech by State Minister Ibayashi
Policy Commentary Corner (P5-)
P5 The JFSA Strategic Priorities July 2023 - June 2024
HASEGAWA Norifumi, Deputy Director
YOKOYAMA Yuki, Section Chief
SUDO Kakeru, Staff member
Strategy Development Division, Strategy Development and Management Bureau

P8 Monitoring Priorities for Securities Businesses July 2023 - June 2024
HAYAKAWA Shino, Deputy Director
IWAMOTO Hirotaka, Planning Section Chief
Securities Business Monitoring Division, Executive Bureau, Securities and Exchange
Surveillance Commission

Notices (P11-)
P11 2023 Campaign to Strengthen Consultation Services for Multiple
Debtors (September to December)
P12 Beware of Fraudulent Remittances through Phishing!
P14 Message to the Market – Explanation of Recommendations for
Administrative Monetary Penalty Payment Orders –JFSA’s Major Activities in September (P15)

Access the online version here
https://www.fsa.go.jp/en/newsletter/2023a.html

Appointment of New State Minister andParliamentary Vice-MinisterOn

September

Minister

On September 19, State Minister Ibayashi and

KISHIDA Fumio reshuffled the Cabinet, and Mr.

Parliamentary Vice-Minister Kanda came to the FSASUZUKI Syunichi was reappointed as the Ministerfor the first time, delivered speeches to the FSA staffof State for Financial Services. At the extraordinaryand succeeded to the duties of their respective

Cabinet meeting held on September 15, Mr.

predecessors, former State Minister FUJIMARUIBAYASHI Tatsunori and Mr. KANDA Junichi were

Satoshi and former Parliamentary Vice-Minister

appointed

SUZUKI Eikei.

as

the

13,

2023,

State

Prime

MinisterandtheParliamentary Vice-Minister, respectively.

1

Ceremony to deliverspeeches

Ceremony to succeed todutiesPhoto: State Minister Ibayashi delivering aspeechPhoto: State Minister Ibayashi (left) succeeding
to duties from former State Minister
Fujimaru (right)

Photo: Parliamentary Vice-Minister Kanda
delivering a speech

Photo: Parliamentary Vice-Minister Kanda (right)
succeeding to duties from former
Parliamentary Vice-Minister Suzuki (left)

National Securities Conference 2023
– Speech by State Minister Ibayashi
On September 25, 2023, State Minister Ibayashi
delivered the following address at the National
Securities Conference 2023 cosponsored by theJapan Securities Dealers Association, the Japanese
Stock Exchange Conference, and the Japan
Investment Trusts Association.

Photo: State Minister Ibayashi delivering a speech

1. Introduction
Thank you for inviting me to the National
Securities Conference today.
I am IBAYASHI Tatsunori, appointed as State
Minister for Financial Services for the Second
Reshuffled Kishida Cabinet.
I have served as Director of the Committee on
Financial Affairs of the House of Representatives
and Director of the LDP's Treasury and Finance
Division, and I have been a member of the LDP's
Research Commission on the Finance and Banking
Systems. In this manner, I have assumed offices
relating to finance so far. I appreciate yourtremendous cooperation in the national government's
financial and economic policies and ask for yourcontinued cooperation.
2. Shift from savings to investment
As Prime Minister Kishida has mentioned, thenational government positions this year as the firstyear of the Doubling of Asset-based Income Plan, an
important year for promoting a shift of assets fromsavings to investment.

As you know, at present, more than half ofJapanese households' financial assets is held as cash
or deposits, and the ownership ratio of shares andinvestment trusts remains low compared to that in
the United States and the United Kingdom. As aresult, looking at changes in households' financial
assets in the last twenty years, the United States andthe United Kingdom saw increases of 3.3 times and2.3 times, respectively, while the increase is only 1.4
times for Japan, which suggests that differences in
returns from investments have exerted a significant
impact on these gaps.
Therefore, it is important to develop an
environment to facilitate Japanese households'
investments using cash and deposits that have been
just kept idle, thereby increasing households' assetbased income, in addition to earned income.
For encouraging people to shift their assets from
deposits to investment and backing up their stableasset formation, the following initiatives that areincorporated in the Doubling of Asset-based Income
Plan, which was formulated last November, areimportant.
• Perpetuation and fundamental expansion of the
NISA program• Ensuring of financial institutions' customeroriented business conduct• Enhancement of financial and economic education
for improving people's financial literacy
First of all, in order to encourage households tochange their investment behavior, the NISA program
will be fundamentally expanded next January. TheNISA program has been steadily disseminated as astarting point for asset formation, but the new NISA
program is expected to further broaden the investor
base. We will work for the smooth introduction anddissemination of the new program.
On the other hand, there is concern that if
households select only foreign companies as theirinvestment destinations, their investments may notlead to the growth of Japanese companies or theJapanese economy as a whole. From the standpoint
as State Minister also in charge of economic
revitalization, I think that it is also very importantfor Japanese companies to enhance their corporate
value and become attractive investment destinations.

2Photo: National Securities Conference

When Japanese companies' corporate value isenhanced, household's assets will be further invested
for the growth of domestic companies, and theresulting growth is returned to households in theform of asset-based income. In other words, avirtuous cycle of growth of asset-based income willthus be achieved. I hope that the new NISA program
will make a contribution to such moves.
For that purpose as well, it is necessary to
improve the effectiveness of the corporate
governance reform and enhance the attractiveness ofJapanese companies as investment destinations. We
would like to vigorously promote these measures toachieve the sustainable growth of Japanesecompanies and economy.
In order to revitalize Japanese financial andcapital markets for the sustainable growth ofJapanese companies and economy, it is also
indispensable to make high-quality and appropriate
financial instruments and financial services available
for a broad range of people.
I would like to ask you, who are selling orotherwise handling financial instruments, to go backto the principle that companies providing good
products are selected in the market and deepen your3

initiatives for ensuring customer-oriented businessconduct.
I would like you to back up individual customers'
asset formation from a medium- to long-term
perspective, based on their life plans and fund needs,
and conduct follow-up activities, not limited toselling financial instruments, to maximize customers'
interests.
Your efforts will develop an environment where
customers can use financial services with trust andsecurity, and this will lead to making your revenue
base more robust. I would like you to create such
virtuous cycle.
With regard to financial and economic education,in order to further promote measures begun in thepast, we will proceed with the establishment of the
new public organization to accelerate financial andeconomic education before the end of this year andpreparations for the full-fledged operation thereof,
on the premise of early enactment and enforcementof related Acts. The organization will aggregateknow-how that you and other diverse entities haveaccumulated so far and strategically provide
effective and efficient financial and economic
education. We appreciate your cooperation.

3. A Leading Asset Management Center
For achieving people's stable asset formation, we
also position the enhancement of the asset
management business, to which households' assets
are deposited, as an extremely important policy
challenge.
The asset management business in Japan
manages a total of approx. 800 trillion yen, such as
funds in investment trusts, pensions, and insurance,
and its role is considered to be very large in creatinga virtuous cycle by leading households' assets togrowth investments in Japan and returning benefits
to households.
Accordingly, asset management companies needto strengthen efforts for securing and fostering
human resources and enhancing their expertise,
thereby reinforcing their management capabilities.
In order to achieve enhanced asset managementbusiness and sound market development in Japan, it
is important to facilitate new entries of asset
management companies to create a mechanism inwhich companies compete with each other toprovide good financial instruments and services
from a customer-oriented perspective and those
providing better financial instruments and services
are surely selected by customers.
We would like to fundamentally strengthen
support for new entries of asset managementcompanies through correcting conventional businesspractices and eliminating entry barriers. We plan toformulate a concrete plan for achieving a leading
asset management center, including these initiatives,
and will proceed with deliberations while listening
to the opinions of various people including you.

•

Photo: State Minister Ibayashi delivering a speech

4. Conclusion
Let me conclude by emphasizing that to facilitatea shift of assets from savings to investment inpublic-private collaboration and contribute tohouseholds' stable asset formation and the Japanese
economy's further development is the commitmentof the whole government, as Prime Minister Kishidasaid himself.
Thank you very much.

The National Securities Conference 2023 washeld as one of the events during the Japan Weeks.*

During the Japan Weeks from September 25 to October 6, 2023, overseas investors and asset managementcompanies converged in Japan, and many events were held in cooperation with related parties under diverse
themes, such as sustainable finance, promotion of a shift from savings to investment, and Japan as a leading asset
management center. For the dedicated webpage, access from here:
https://www.fsa.go.jp/internationalfinancialcenter/lp/japanweeks/index_en.html

4Policy Commentary Corner

The JFSA Strategic Priorities July 2023 - June 2024
HASEGAWA Norifumi, Deputy Director
YOKOYAMA Yuki, Section Chief
SUDO Kakeru, Staff member
Strategy Development Division, Strategy Development and Management Bureau
Upon the publication of the JFSA Strategic
Priorities July 2023 - June 2024
On August 29, 2023, the JFSA published "TheJFSA Strategic Priorities July 2023-June 2024“.*This clarifies the goal of financial administration andshows policies to be taken by financial
administration to achieve those goal. The JFSA
expects that this publication will further enhancetransparency and contribute to achieving better
financial administration by facilitating awarenesssharing and constructive dialogues among the JFSA,
financial service users, financial institutions, andmarket players, etc.
The JFSA accepts comments on the JFSAStrategic Priorities on an ongoing basis. Your
comments will be used as reference in the future.
Please send your comments to our website contact(https://www.fsa.go.jp/opinion/)(Available inJapanese).
This business year's JFSA Strategic Priorities
July 2023-June 2024 was compiled based on broad
opinions, including those from officials of Local
Finance Bureaus nationwide, in addition to majoradministrative challenges ascertained in the lastbusiness year, through repeated discussions among
executive officials and with the participation ofmany others. Through these activities, we willdevelop an organizational culture wherein all staff
members voluntarily plan, formulate and implement
policies, and will pursue further collaboration with
Local Finance Bureaus.

III. Ensure Stability and Confidence in the
Financial System
IV. Constantly Evolve and Deepen JFSA's
Financial Administration
First, the JFSA supports Japan's economic activities
and people's lives from a financial aspects so thatthey remain stable in the face of changing social andeconomic circumstances, and lead to subsequent
growth.
Second, the JFSA will endeavor to achieve a‘’virtuous cycle of growth and asset-based income”
and deal with various social problems including
climate change and the advancement of a digitalsociety realization for building a financial system forsimultaneously achieving economic growth andresolution of social issues.
Third, the JFSA will conduct in-depth monitoring tomaintain financial institutions’ soundness, enforce
thorough compliance with laws and regulations,ensure customer-oriented business conduct, andfully perform financial intermediary functions.
Fourth, the JFSA will constantly evolve and deepen
its financial administration through enhancing datautilization, strengthening its capabilities todisseminate policy information at home and abroad,and improving its staff members' capacity andquality.

Priorities for business year 2023
The JFSA Strategic Priorities July 2023-June2024 focuses on the following four areas:
I.
Support the Economy and People's Lives for
Future Growth
II. Build the Financial System for Achieving
Economic Growth and Resolving Social Issues

5* Published on September 22, 2023: Publication of the summary from "The JFSA Strategic Priorities July 2023-June 2024"
https://www.fsa.go.jp/en/news/2023/20230922.html

I. Support the Economy and People's Lives for
Future GrowthThree years have passed since COVID-19 began
to spread, and the normalization of social andeconomic activities is progressing, but there still aremany companies facing severe business environments
due to price hikes of raw materials and energy, theyen‘s depreciation, and labor shortage. Additionally,
repayment for effectively interest-free and unsecuredloans provided by public and private financial
institutions
hascommenced.
Under
such
circumstances, it is important that regional financial
institutions, in particular, support local industries andcompanies and contribute to the recovery and growthof local economies. Accordingly the JFSA encourages
financial institutions to provide not only financing
support but also support for business improvement
and business revitalization in accordance withindividual companies’ actual conditions by utilizing
subordinated capital loans and equity funds by
REVIC, etc.
From such perspective, the JFSA will check thestatus of financial institutions' concrete initiatives
through focused hearings on business support andcontinue dialogue on identified issues, and promote
the sharing of knowledge and know-how related tobusiness revitalization support among financial
institutions, including regional ones, and thematching of corporate management personnel inorder to enhance business support capabilities offinancial institutions. Additionally, the JFSA will
promote the implementation of the "Reform Program
regarding Personal Guarantee Provided by Business
Owners" and the early institutionalizing security
interests over all assets, aiming to establish lending
practices that encourage the sustainable growth ofbusinesses. Through these efforts, the JFSA will
support a robust recovery of the Japanese economy
toward further growth into the future.
II. Build the Financial System for Achieving
Economic Growth and Resolving Social Issues
The JFSA will endeavor to achieve a "virtuous
cycle of growth and asset-based income" forachieving sustainable economic growth by leading
households' assets that have just been kept idle toinvestments and having the fruit of growth will bepassed on to people widely and will lead to people's
asset formation and a further increase in consumption

and investment. For example, the JFSA will promote
initiatives aiming to achieve a leading AssetManagement Center, such as for the enhancement of
the asset management business and strengthening of
the functions of asset owners, and it will positively
provide information inside and outside of Japan. In
addition, the JFSA will promote the dissemination
and utilization of the new NISA program and theimplementation of the Doubling of Asset-based
Income Plan, centered on the enhancement offinancial and economic education.
Additionally, amid rapid changes in social andeconomic structures, Japan needs to deal with various
social problems including climate change digitalsociety realization, diversity, achievement of a digitalsociety, and startup support. The JFSA will develop afinancial environment so that our efforts for solving
those social problems lead to the creation of newmarkets, with the aim of achieving both economic
growth and solutions to social problems. For example,
for facilitating smooth funding for start-ups, the JFSA
will consider improving the environment for equity
crowdfunding and easing the requirements forapproval of Proprietary Trading Systems (PTSs). For
accelerating corporate governance reform andenhancing disclosure of corporate information, the
JFSA will also review the large shareholding
reporting rule, enhance disclosure of non-financial
information, and review quarterly disclosure.
Furthermore, the JFSA will promote sustainablefinance by enhancing corporate sustainability
disclosure, promoting dialogue between industry andfinancial institutions toward GX and impact
investment. The JFSA will also promote the entry of
FinTech businesses and create an environment for
digital money and crypto-assets for achieving a
digital society.
III. Ensure Stability and Confidence in the
Financial System
In order to have financial institutions fully fulfill
financial intermediary functions, while maintaining
the soundness even as the environment surrounding
them is changing, the JFSA will accurately identify
the financial, economic, and global situations andalso conduct in-depth monitoring of financial
institutions through data analysis and dialogue with
them.

6

For example, the JFSA will keep a close watch
over the trends in global financial and economic
situations, including domestic and foreign monetary
policy and interest rate developments, and analyze theimpact of those trends on financial system stability.
Additionally, to ensure that financial institutions
develop sustainable business models, the JFSA will
also conduct monitoring their business infrastructure,
financial bases, governance, arrangements for
managing various risks, including credit, market, andliquidity risks, and internal audit through dialogue,
and encourage them to strengthen their business basesin accordance with their respective situations. Fromthe perspective of ensuring convenience for users, the
JFSA will require financial institutions to enforce
thorough compliance with laws and regulations, andencourage them to establish systems for theorigination, sale, management, etc. of financial
instruments that contribute to the best interest ofcustomers, including the handling of high-risk
financial instruments, for ensuring customer-oriented
business conduct. Furthermore, regarding financial
institutions AML/CFT, cybersecurity, economic
security, and system risk management, the JFSA willencourage financial institutions to act appropriately
based on the global developments.
IV. Constantly Evolve and Deepen JFSA's
Financial Administration
From the perspective of constantly evolving and7

deepening its financial administration the JFSA will
work to further enhance financial administration byenhancing data utilization, promoting further
collaboration with Local Finance Buraus, andstrengthening the ability to advocate its policies aswell as public relations domestically andinternationally. At the same time, the JFSA will
endeavor to maximize its power as a body in chargeof financial administration by letting all staff
members exercise their abilities to the extent possible.
For example, in order to accurately ascertain thebusiness conditions of financial institutions and theresilience and the vulnerability of the financial system
as a whole, the JFSA will grasp the actual conditions
in a multifaceted manner through enhanced datautilization and reflect the results thereof in monitoring
through dialogue, etc. with financial institutions.
Additionally, in order to raise people's interest in andunderstanding of financial policies, the JFSA will
strengthen its capabilities to disseminate policy
information at home and abroad and properly
communicate its initiatives. Furthermore, the JFSA
will also endeavor to improve its staff members'
capacity and quality by preparing training programsin various fields in accordance with individuals' needs
to enhance their expertise, and create a workplace
where every staff member can have unrestricteddiscussions and work actively, while fully exercising
their abilities, with their voluntary and autonomous
efforts valued.

Policy Commentary Corner

Monitoring Priorities for Securities Businesses (July 2023 - June 2024)
HAYAKAWA Shino, Deputy Director
IWAMOTO Hirotaka, Section Chief
Securities Business Monitoring Division, Executive Bureau, Securities and Exchange Surveillance Commission

In order to conduct securities businessmonitoring* for over 8,200 financial instruments
business operators (FIBOs), such as securities
companies and investment management business
operators, in an effective and efficient manner, the
SESC appropriately ascertains the effectiveness ofgovernance, characteristics of businesses, such asservices and products and transaction types, theappropriateness of risk management, and financial
conditions, etc., and selects FIBOs for inspection inaccordance with the characteristics of risks faced by
FIBOs.

Considering the environment surrounding FIBOs
and changes to regulatory frameworks, and findings
through the securities business monitoring over the
past business year, and the JFSA’s policies, such as“The JFSA Strategic Priorities” the SESC conducts
securities business monitoring in cooperation with
relevant JFSA divisions.

[Changes in the numbers of monitored FIBOs (as of the end of each program year)]* Securities

business monitoring covers both "inspections (on-site monitoring)" and "wide range of monitoring
activities other than inspections for widely gathering information on FIBOs (off-site monitoring)."8

1. Industry-wide monitoring priorities
As industry-wide monitoring priorities,
following five are cited.

the

(i)

Internal control environments with a focus on
appropriate investment solicitation based on theprinciple of suitability, and appropriate sales
operations based on customer-oriented businessconduct (for instance, sale of complex or highlyrisky products, not limited to structured bonds)(ii) Business model changes along with progress indigitalization, etc., and the development of internal
control environments in response to such changes(iii) Sufficiency of cybersecurity measures (including
countermeasures against unauthorized access inonline trading), and system risk management(including management of system development
and operation and management of trustees) in
response to progress in digitalization(iv) Firm
establishmentofinternal
controlenvironments for AML/CFT(v) Implementation of measures to improve or preventthe recurrence of matters pointed out in internal
audits or SRO examinations
In addition to the above, the SESC will flexibly
examine other themes in accordance with concrete
efforts being made in light of the environment
surrounding FIBOs, such as the implementation of the"Doubling Asset-based Income Plan" and fundamental
reform of the asset management business, etc., as wellas in response to changes in the relevant environment.
2. Monitoring priorities by FIBOs' size andbusiness typeThe following are some examples of monitoring
priorities by size and business type.
 Major securities business groups: The developmentof control environments for governance and risk
management that support global business operations,and internal control environments, including thosefor detecting and preventing market misconduct,
etc.; For the three mega banking groups' securities
companies, also the development of control
environments for managing customer information inline with their promotion of bank-securities business
relationships
 Foreign securities firms: The development ofinternal control environments in response to theoverseas outsourcing of back-office operations, andcontrol environments for system risk management9 Online securities firms: The development ofmanagement of outsourcing contractors, in line with
their business model of using financial instrumentsintermediary service providers to expand face-toface sales activities, and internal control
environments, including effective trade managementthat can deal with rapid increases in newly opened
accounts and transaction volume, etc.
 Semi-major/regional securities firms , etc.:
Inappropriate solicitation and other forms of conductthat are inappropriate from the viewpoint of investor
protection, including whether following the principleof suitability; Development of internal control
environments at those securities firms whose major
shareholders or business management systems havechanged, from the viewpoint of their businessmodels or governance, etc.
 Foreign currency margin transactions business
operators: Development of adequate internal control
environments for relevant advertising andsales/solicitation regulations, etc.
 Investment management business operators: Actual
investment practices and development of control
environments for managing investment (including
those outsourced) and conflicts of interest
 Investment
advisors/agencies:
Misleading
advertisement and solicitation through false
explanation, etc.
 Type II FIBOs, and business operators, etc. engaging
in specially permitted businesses for qualified
institutional investors: Funds claiming high returns
and the existence of investment projects
 Financial
instrumentsintermediaryserviceproviders: Appropriateness of their investment
solicitation, and sufficiency of the management by
their entrusting FIBOs
 Unregistered business operators: Exercising
investigative authority proactively to file a petition
with the court for a prohibition and stay order
against illegal conduct, and enhancing information
dissemination, including the public disclosure of
their and their representatives' names and illegal
conduct, etc.

[Number of inspections completed (Unit: cases)]Year

PY2017

PY2018PY2019PY2020

PY2021PY2022

Number of inspections
completed

41

56

76

53

32

48

FIBOs

33

49

66

44

28

39

Type I FIBOs

21

31

46

35

22

24

Type II FIBOs

6

7

4

2

0

3

4

7

11

3

2

5

2

4

5

4

4

7

0

2

3

0

2

1

QII business operators

5

2

2

0

0

2

Financial instrumentsintermediary service provider

2

3

1

4

0

2

Category

Investment
advisors/agencies
Investment managementbusiness operators
Registered financial
institutions

Credit rating agencies

0

0

0

2

0

0

Self-regulatory organizations,
etc.

0

0

2

0

2

0

Investment corporations

0

0

1

1

0

4

Others

1

0

1

2

0

0

3. Approach to monitoring securities businesses
The SESC collaborates with relevant JFSA divisions
to identify and assess at FIBOs for risk-based inspection.
Mainly for the following cases, the SESC will conduct
inspections.
(i)an FIBO has breached a relevant law and/or
regulation or has concerning business operations,which necessitates prompt in-depth verification.
(ii) an FIBO offers a financial instrument with unclear
risk profile, which necessitates examination of its
solicitation activities.
(iii) an FIBO’s actual business operations cannot be
fully comprehended through monitoring-based
information analyses alone (including where it has
been long since the last time the FIBO wasinspected).
(iv) an FIBO poses a possible serious problem in termsof investor protection (e.g., inadequate segregationof customer assets).
In its inspections, the SESC will endeavors to
conduct verification and point out problems in apractically meaningful manner, to analyze the whole
picture of the problems to identify their root causes, andto help develop effective measures to prevent recurrence,
rather than merely pointing out problems and taking suchactions as making recommendation for administrative
disciplinary actions. Furthermore, if the SESC identifies
the need to improve business operations before any
potential issues materialize, to shares the awareness with
the inspected FIBOs to encourage actions such asbuilding effective internal control environments.

4. Cooperation with relevant organizations anddissemination of inspection results and otherinitiatives
The SESC and Local Finance Bureaus, etc. will work
closely from the planning stage of monitoring andinspections, and conducts joint inspections as needed.
With regard to security tokens, the SESC will analyze
information, including how they are issued anddistributed, in collaboration with relevant JFSA divisions.
The SESC will continue close collaboration with
SROs, shares detected matters and awareness in a timely
manner, and thereby conducts its securities businessmonitoring effectively and efficiently.
The SESC will encourage voluntary improvement
efforts by inspected FIBOs, including, as necessary, by
providing feedback on problems and root causes found,and by sharing inspection results also with their auditrelated staff and outside directors at review meetings.
The SESC will also endeavor to provide information
about its perspectives in a specific and straightforwardmanner, including through the "Overview of Securities
Business Monitoring and Case Studies." Names of thebusinesses to which the SESC made recommendations
based on inspection results came to be published in thisdocument, starting with the one published on August 1,
2023.

10

Notice2023 Campaign to Strengthen Consultation Services forMultiple Debtors (September to December)

The Headquarters for Measures for Multiple
Debtors (headed by the Minister of State for Financial
Services) carries out a nationwide campaign tostrengthen local governments' systems of consultation
services for multiple debtors every year.
The issue of multiple debtors has calmed down
compared to the past, but there is still a certain numberof people with large debts and we need to continue
taking measures therefor.
Accordingly, this year as well, the Headquarters,
Japan Federation of Bar Associations, Japan
Federation of Shiho-Shoshi Lawyer's Associations,and Japan Legal Support Center (Houterasu) are
jointly carrying out the 2023 Campaign to Strengthen
Consultation Services for Multiple Debtors from
September to December.
During this campaign period, prefectural
governments, jointly with bar associations, ShihoShoshi Lawyer's Associations, Small and Mediumsized Enterprise Associations and Local Finance
Bureaus of respective prefectures, carry out initiatives
such as holding free consultation events targeting
consumers and businesses (including the extension ofhours for accepting consultations of permanent
consultation offices and the acceptance ofconsultations by phone).
During a consultation, staff members first
empathically endeavor to ascertain the current
situations of respective consulters with multiple debts
and then work with them to solve their problems,
while introducing specialists or specialized agencies asnecessary.
If you are struggling to pay back debts or have any
trouble, such that you cannot pay back loans, you haveborrowed money from a loan shark at an unreasonableinterest rate, or you are addicted to gambling, pleasefeel free to have a consultation with us, or if you know
someone in trouble, we would appreciate it if you
would tell that person about this campaign.
The schedules for free consultation events areavailable on the FSA website (you can also access itfrom the following QR code).

11

Additionally, the FSA website introduces avoluntary lending restriction system, which prevents
borrowers from borrowing new loans for lavish
spending or gambling if the borrowers are subjected tolending restrictions through their own initiative or theirlegal representatives' reports to the Japan Financial
Services Association or the Personal Credit
Information Center of the Japanese Bankers
Association in such cases as where the borrowers'
lavish spending practices or their heavy dependence on
gambling could disrupt their and their families' lives.
In implementing the campaign this year, the FSA
gives sufficient consideration to people affected by
COVID-19.

[Poster for the Campaign to Strengthen
Consultation Services for Multiple Debtors]

Notice

Beware of Fraudulent Remittances through Phishing!

Regarding financial damage, such as fraudulent

in damage from late August to September last year, but

withdrawals of deposits, etc. by the use of forged cash

damage has been increasing again from February. As

cards, stolen cash cards, or stolen passbooks, orof August 4, 2023, the number of cases in the first halfthrough internet banking services or payment servicesof this year hit a record high at 2,322 cases and thelinked to bank accounts (linked services), the FSA

amount of damage is approximately 3 billion yen. In

compiles the situation of the occurrence of damage andlight of such rapid increase in damage, the FSA

compensation by financial institutions based on reports

broadly called for attention on its website*2 and official

by individual financial institutions, and publishes the

X (formerly Twitter) page, etc., in collaboration withresults regularly.*1

the National Police Agency.

Since last year, there have been many cases whereinternet banking users' IDs and passwords were stolen
and their bank deposits were fraudulently remitted

Please note the following points so as to avoid
becoming a victim.

probably by phishing using email, short message
services (SMS), or other message tools. The situation

You may think "I am OK." However, you must
always be on your guard.

had calmed down to some extent after a rapid increase

Points to note so as to avoid becoming a victim of phishing Do not open unexpected SMS. (Financial institutions will never ask you about your ID or password using
SMS.) When accessing a financial institution's website, do not use an URL stated in SMS. You should bookmark
correct URLs in advance and access a financial institution's website from the bookmarked URL, or use theofficial app provided by the relevant financial institution.
 If you are receiving many phishing emails, you should strengthen your spam filtering settings.
 Use multifactor authentication or another authentication system recommended by financial institutions.
 If antivirus software is provided free of charge on a financial institution's official website, consider usingit.
 Upgrade the antivirus software on your computer to the latest version.
 Activate the function to report the status of use of internet banking services and pay attention to whether
there have been any suspicious transactions (such as logins, password changes, or remittances). You should
check the balance and details of account activities often, and when you notice any unknown transaction,
you should make an inquiry with the financial institution promptly.

*1*2

For the details of the latest publication, see "Situation of financial damage caused by forged cash cards, etc."(Available in Japanese) published on September 29, 2023.
"Rapid increases in cases where internet banking user's bank deposits were fraudulently remitted probably byphishing" (Available in Japanese) published on August 8, 202312

★Contact the following for any inquiries.
FSA's Counseling Office forFinancial Services Users*03-5251-6811 when you use an IP phone.
Service hours: 10:00 am-5:00 pm on weekdays

Police

TEL: #9110 (Non-emergency counseling hotline of prefectural polices)Japanese Bankers

TEL: 0570-017109

Association's Counselling
Office13

TEL: 0570-016811* 03-5252-3772 when you use and IP phone.
Service hours: 9:00 am-5:00 pm on weekdays

Notice
Message to the Market– Explanation of Recommendations for Administrative
Monetary Penalty Payment Orders –The Securities and Exchange SurveillanceCommission ("SESC") posts explanation ofrecommendations that it has issued on its website as
an article titled "Message to the Market."
The content of "Message to the Market" posted on
September 21, 2023, is as below.

* For the full text of "Message to the Market," please
access the SESC's website:< Reference URL >https://www.fsa.go.jp/sesc/message/20230921.html(Available in Japanese)

Recommendation for an administrative monetary penalty payment order against a person
for a violation in regard to making false statements in DDS CO. LTD's disclosure documents
The Securities and Exchange SurveillanceCommission (SESC) made a recommendation that thePrime Minister and the Commissioner of the Financial
Services Agency impose an administrative monetary
penalty order*1 against a person on August 4, 2023, as
the following fact of legal violation was found as aresult of an inspection regarding the person's specified
involvement*2 pertaining to false disclosure
documents submitted by DDS CO. LTD. (DDS).
[Summary]
In order to prevent the revelation of excessive
recording of receivables from a foreign corporation,etc., DDS committed a series of acts of subscribing toshares of the foreign corporation at a price based onan overestimated share price and contributing all theaforementioned receivables in kind, and thereby
making the foreign corporation its subsidiary, andthen settling accounts inappropriately, such as
excessively recording goodwill, etc. based on thesetransactions. DDS submitted an annual securities
report, etc. thus containing "a false statement about amaterial particular."
The person engaged in work to calculate the valueof the aforementioned foreign corporation's shares asrequested by DDS and calculated the value per shareexcessively above the subscription price although the
*1

*2

*3

actual price was below that subscription price, andprepared a written calculation of the foreign
corporation's share price and submitted it to DDS,
while the person had known from the beginning that
DDS would use the relevant document to pretend thatthe subscription price was based on reasonablegrounds in committing the aforementioned series ofacts. In this manner, the person had DDS use thedocument in the aforementioned series of acts.*3
The person's acts facilitated the submission of thefalse disclosure documents, and the person took partin the series of DDS's acts for disguising part of thefact that serves as the basis for the accounting process,which was necessary for preparing the false disclosure
documents, while being aware of the reality. It isfound that the person's acts fall under the "specified
involvement" prescribed in Article 172-12 paragraphs(1) and (2) of the Financial Instruments and Exchange
Act.
This is the first case in which the SESC made a
recommendation for an administrative monetary
penalty payment order against specified involvement.
The SESC will take rigorous actions against nontraditional and new types of violations as well,including specified involvement as in this case.

Specified involvement refers to an act to facilitate the submission of an annual securities report, etc. containing a false
statement about a material particular or an act to encourage the submission of such document (excluding an audit
certification by a certified public accountant or an audit corporation).
"Recommendation for an administrative monetary penalty payment order against a person for a violation in regard to
making false statements in DDS CO. LTD's disclosure documents" published on August 4, 2023:
https://www.fsa.go.jp/sesc/news/c_2023/2023/20230804-1.html (Available in Japanese)"Decision on an administrative monetary penalty payment order against a person for a violation in regard to making
false statements in DDS CO. LTD's disclosure documents" published on February 9, 2023:
https://www.fsa.go.jp/news/r4/shouken/20230208-1.html (Available in Japanese)

14

JFSA's Major Activities in September(September 1 to September 30, 2023)
 Publication of "FSA Analytical Notes"(September 29, 2023)
 Summary of Results of the Fifth Survey on the Use of LIBOR(September 29, 2023)
 Updated : Trends in High-Speed Trading(September 29, 2023)
 Appointment for First Chair of FSB Transition Plan Working Group (TPWG) (September 28,
2023)
 The fourth meeting of the Working Group on Tender Offer Rule and Large Shareholding
Reporting Rule of the Financial System Council (September 25, 2023)
 Publication of the summary from "The JFSA Strategic Priorities July 2023-June 2024"(September 22, 2023)

 2023 International Association of Insurance Supervisors (IAIS) Annual General Meeting (AGM)
and Annual Conference (AC) (September 8, 2023)
 Updated : Japan Weeks for the Realization of an International Financial Center (September 6,
2023)
 The third meeting of the Working Group on Tender Offer Rule and Large Shareholding Reporting
Rule of the Financial System Council (September 1, 2023)
 Publication of the Revised Draft of “Guidelines for Creating, Recordkeeping and Reporting ofTransaction Information specified in Article 4(1) of the Cabinet Office Order on the Regulationof Over-the-Counter Derivatives Transactions, etc." - Open for Public Comments (September 1,
2023)

JFSA's official English X(formerly Twitter) accounthttps://twitter.com/JFSA_en

We are promoting
information dissemination
using X(formerly Twitter) !

Editorial Postscript
The clear autumn weather continues. Enjoying the fresh morning air, I must agree with the idea that it is goodto wake up at the same time every morning. Nevertheless, data on my smartphone shows a clear pattern of getting
up gradually later from Monday to Friday. Seeing is believing, so I can't argue with the data. I'm striving tosharpen my senses and improve my daily habits, while enjoying the repetition of data checking and correction
made possible by visualization thanks to technological advancement.
These days, I am thinking about what kind of PR activities we can carry out to properly communicate
financial policies to financial markets and to the general public. Luckily, I have met many experts and seniors aswell as talented young people, and I feel that our ideas are being deepened one by one through exchanges withthese people. Checking and correcting repeatedly in light of our current standpoint… I'll probably stay up lateagain tonight.
YANO Shohei, Director of the Public Relations Office, FSA
Edited and issued by the Public Relations Office, FSA

15(*The opinions expressed in this report are the personal views of the author and do not necessarily reflect the organization
with which the author is affiliated.)