Silviase/jgov_v1.4_full_ann huggingface dataset:
## 3 Efforts of Real Estate Industry

In December 2007, the real estate industry established the "Liaison Council for Preventing Transfer of Criminal Proceeds and Preventing Damage by Antisocial Forces in the Real Estate Industry" so that the real estate industry as a whole, can promote collective efforts to prevent the transfer of criminal proceeds and eliminate antisocial forces. It proceeds with taking measures to share the information regarding the operation of systems including the Act on Prevention of Transfer of Criminal Proceeds, through efforts such as discussing the development of a responsibility system within relevant business operators, and preparing and distributing brochures etc. for the purpose of enlightenment.

## 4 Efforts of Lawyers Associations

The Japan Federation of Bar Associations had been examining the relation between anti-money laundering measures and the duties of a lawyer, recognizing the importance of the measures, and established with a resolution of the general assembly meeting in March 2007, the "Rules on Identification of Clients and Record-Keeping" which stipulates the obligations of a lawyer; e.g., confirming the identity of a client, preserving the records for certain practices, and not accepting a request if suspected to be used for transfer of criminal proceeds. The rule was put into effect on July 1, 2007.

Every year, the Japan Federation of Bar Associations holds workshops, provides videos of the workshops and distributed materials over the Internet, and offers training videos and educational materials such as FAQs to each bar association for the purpose of raising awareness of the rules. Moreover, an instruction manual of the rules is placed on its website for members and its journal which is sent to all members.
# Reports of Suspicious Transactions

The Act on Prevention of Transfer of Criminal Proceeds requires specified business operators to file a report to a competent administrative authority if a transaction is suspected to be related to criminal proceeds. This measure was made obligatory for the first time in the Anti-Drug Special Provisions Law and was taken over to the Act on Prevention of Transfer of Criminal Proceeds through the Act on Punishment of Organized Crimes.

## Section1 Outline of the Suspicious Transaction Reporting System

## 1 Purpose

The Suspicious Transaction Reporting System aims, to support investigation on money laundering and its predicate offences, to prevent criminals' illegal use of the services of specified business operators and to ensure soundness and trust of business activity.

## 2 Cases in which Reporting is Required

Specified business operators are required to file an STR to a corresponding supervising authority, when they suspect, during the course of their businesses (types of the businesses listed in table 2-2), that assets they received are criminal proceeds or that their client commits an offence of concealment of criminal proceeds.

## 3 Announcement of List of Reference Cases of Suspicious Transactions (Guideline)

Specified business operators are expected to judge whether the concerned transaction is a suspicious transaction with their own knowledge and experience at their industries, taking into account the form of transaction, client attributes, conditions surrounding the transaction and other factors. It may well be the case, however, that some operators simply lack adequate understanding of money laundering and find it difficult to make an appropriate judgment. Therefore, in Japan, since the enforcement of the Anti-Drug Special Provisions Law, "List of Reference Cases of Suspicious Transactions," has been issued for specified business operators as a guideline for reporting. It is often called the "Reporting Guideline." After full enforcement of the Act on Prevention of Transfer of Criminal Proceeds, which covers a wider variety of specified business operators than before, competent administrative authorities have announced reference cases of suspicious transactions, based on the characteristics of respective specified business operators.

These reference cases are just, as clarified in the introduction thereof, samples of suspicious transactions and are intended merely for reference. This means, it is for the specified business operators to judge whether an individual case is a suspicious transaction, taking into account the client's attributes, conditions surrounding the transaction and other specifics of the transaction. All the transactions that appear to match the listed samples do not necessarily have to be reported as suspicious, while transactions that do not fall within any of them may still be suspicious and subject to reporting.
## 4 Analysis of Bank Account used for Crime

JAFIC has carried out operations to statistically abstract the characteristics of bank accounts used for crime in cooperation with the Prefectural Police etc. in order to make use of it in arranging and analyzing information regarding STRs, and as part of information provision to the specified business operators that is regulated in the Act on Prevention of Transfer of Criminal Proceeds, Article 3.

## 5 Flow of Suspicious Transactions Reporting

Information reported by specified business operators is collected at the National Public Safety Commission / the National Police Agency (JAFIC), via the competent administrative authorities. JAFIC arranges and analyzes STRs, check the importance of them, and then disseminates the useful STRs to investigative authorities such as the Prefectural Police, the Public Prosecutors Office etc.

The investigative authorities receive and use STRs as clues for criminal investigation, and for countermeasures against organized crime such as detection of criminal proceeds and tracing the source of illicit funds. JAFIC also provides foreign FIUs with information of overseas transactions if needed, in order for them to trace criminal proceeds transferred across international borders.

Furthermore at JAFIC, a detailed analysis of STRs is carried out by using the information gathered by the police for organized crime countermeasures etc. and the results of analysis are disseminated to related Prefectural Police and other agencies.

Figure 4-1 Flow of STRs from Specified Business Operators, through JAFIC to Investigative Authorities

## 6 Information Security Measures

Since STRs include sensitive information on individuals and business activities, JAFIC carries out due information security measures to prevent leakage, loss, damage, or other misconduct. The handling of relevant information is set forth in the regulations of the National Public Safety Commission. In particular, since a large amount of information is stored in the database system which manages suspicious transactions, sufficient security measures need to be taken. Various security measures put in place at JAFIC are as follows.

## (1) Management of Entering and Exiting

Terminals that can access information stored in the JAFIC database are located in a room with doors that are controlled by a biometric authentication system. Only a limited number of staff members are permitted to enter the room.

## (2) Three steps of Authentication

In order to access the information in the JAFIC database, three levels of authentication are required. In other words, information can be reached only after authentication is carried out 3
times, in 3 different ways. During the authentication procedure, if more than one mistake occurs, access to the terminal is denied to prevent unauthorized use.

(3) Surveillance of Terminal

All processing operated at the terminals, such as file inquiries and printing, is monitored and recorded by the surveillance software. This allows for tracing in case of wrongful operation, and prevents improper use of information within the organization.

(4) Physical Measures of Terminals

Each terminal is firmly affixed to a desk with a security wire, to prevent theft.

(5) Strengthening of Server Management

The server that contains reported information is located in a server room with adequate security measures, and only qualified staffs are allowed to enter.

(6) Encryption of Terminal's Hard Disk Drive Information

The hard disk drives on the terminals that are used to access the database system are all encrypted. Therefore, even if the hard disk drives are removed and taken out, the information recorded in the hard disk drive and all related programs will still be inaccessible.

(7) Encryption of Circuit

Transmission between the server and the terminals is encrypted with a special circuit.

## Section2 Situation of Suspicious Transaction Reports in 2011

## 1 The change in the number of reported cases

As described in Chapter 1, although the suspicious transaction reporting system was established with the enforcement of the Anti-Drug Special Provisions Law in 1992, less than 20 cases were reported each year between 1992 and 1998, largely because the subjects of reporting was limited to proceeds derived from drug-related crimes. Under these conditions, that reporting system could not be considered to be fully functional. However, since the enactment of the Act on Punishment of Organized Crimes in 1999 (enforced in February 2000), crimes which are subjects of suspicious transaction reports were expanded from drug-related crimes to serious crimes, and the number of reports exceeded 1,000 cases in 1999. Since the enforcement of the Act on Punishment of Organized Crimes in the year 2000, the number of reports has increased each year, and has rapidly increased since the enforcement of the Act on Prevention of Transfer of Criminal Proceeds in 2007. The number of reports in 2011 was 337,341, an increase of 43,036 cases (14.6%) compared to the previous year, or approximately 2.1 times the number of reported cases in 2007 (see Table 4-1 and Figure 4-2). The number of cases in which information on suspicious transactions was eliminated by the Director for Prevention of Money Laundering in 2011 was zero in 2011.

Table 4-1 Trend Diagram of Number of Reports of Suspicious Transactions (1992-2001)

1992	1993	1994	1995	1996	1997	1998	1999	2000	2001
Yearly number of Reports Received	12	17	6	4	5	9	13	1,059	7,242	12,372

Note: The reports of 1992 are those made after July, when the reporting system was established.
Figure 4-2 Trend Diagram of Number of Reports of Suspicious Transactions (2002-2011)

Yearly Number of Reports Received	18,768	43,768	95,315	98,935	113,860	158,041	235,260	272,325	294,305	337,341
Yearly Number of Reports Offered	12,417	30,090	64,675	66,812	71,241	98,629	146,330	189,749	208,650	234,836

Note 1: "Number of Reports Received" (2002-2011) is the total number of the reports received by the Financial Services Agency(JAFIO) from January 2002 to March 2007 and those received by the National Public Safety Commission/the National Police Agency (JAFIC) after April 2007.

Note 2: "Number of Reports Offered" (2002-2011) is the total number of the reports offered by JAFIO to the National Police Agency from January 2002 to March 2007 and those offered by JAFIC to investigative authorities etc. after April 2007.

The factors contributing to the increase in reporting numbers can be thought to be

☐ The monitoring system for antisocial forces and illegal funds transfer has been reinforced by financial institutions, with the progress of compliance awareness in society.

☐ The repeated education on the cases of suspicious transactions (guidelines) through seminars for financial institutions etc. (see Paragraph 1 of Section 5 of Chapter 3) in the past has a positive effect.

Moreover, financial institutions etc. have taken various measures, both tangibly and intangibly. In particular, some financial institutions whose STRs have been increased, have promoted training on countermeasures against money laundering by using resources, such as handbooks for employees, to improve the ability of individual employees, while having strengthened the system to identify suspicious transactions, by increasing personnel in charge of money laundering countermeasures and the introduction of the detection systems for suspicious transactions.

## 2 Number of Reports by Business Types

The number of suspicious transaction reports that each category of business operators filed in 2011 is shown in table 4-2. Banks etc. have the highest number of reports with 311,298 cases, or 92.3% of all
reports, followed by Shinkin bank and Credit cooperative (12,453 cases, 3.7%), and financial instrument business operators (6,758 cases, 2.0%) (see Table 4-2).

The number of reports filed by business operators who were newly required to report suspicious transactions in accordance with full enforcement of the Act on Prevention of Transfer of Criminal Proceeds in March 2008 (Financial Leasing Operators, Credit Card Operators, Real Estate Agents, Dealers in Precious Metals and Stones, Postal Receiving Service Providers, and Telephone Receiving Service Providers) totaled 2,438, an increase of 662 cases (37.3%) from the previous year.

Table 4-2 Number of Suspicious Transaction Reports by Each Business Type

Year	2010	2011	Increase/Decrease rate
Category	Number of reports	%	Number of reports	%	Number of reports	%
Financial Institutions etc.	292,529	99.4%	334,903	99.3%	42,374	14.5%
Banks etc.	272,215	92.5%	311,298	92.3%	39,083	14.4%
Shinkin Banks and Credit Cooperative	11,156	3.8%	12,453	3.7%	1,297	11.6%
Labour Banks	243	0.1%	248	0.1%	5	2.1%
Norinchukin Banks etc.	357	0.1%	601	0.2%	244	68.3%
Insurance Companies	202	0.1%	677	0.2%	475	235.1%
Financial Instruments Business	5,666	1.9%	6,758	2.0%	1,092	19.3%
Money Lending Business	634	0.2%	581	0.2%	-53	-8.4%
Fund Transfer Companies	73	0.0%	344	0.1%	271	371.2%
Commodity Futures Traders	13	0.0%	5	0.0%	-8	-61.5%
Currency Exchanging Operators	1,970	0.7%	1,937	0.6%	-33	-1.7%
Electronic Monetary Claim Recording Institutions	0	0.0%	1	0.0%	1	—
Financial Leasing Operators	83	0.0%	45	0.0%	-38	-45.8%
Credit Card Operators	1,617	0.5%	2,350	0.7%	733	45.3%
Real Estate Agents	21	0.0%	5	0.0%	-16	-76.2%
Dealers in Precious Metals and Stones	19	0.0%	4	0.0%	-15	-78.9%
Postal Receiving Service Providers	36	0.0%	34	0.0%	-2	-5.6%
Telephone Receiving Service Providers	0	0.0%	0	0.0%	0	—
Total	294,305	100.0%	337,341	100.0%	43,036	14.6%
## 3 Number of notification cases classified by notification methods

According to notifications of suspicious transaction by notification method, notification by electronic application using the e-governance on-line window (e-Gov), and notification other than by electronic application (for example, sending documents etc. to the supervising administrative government agency) are described in Table 4-3.

Table 4-3 Number of Reports by Each Notification Method

Notification Methods	2008	2009	2010	2011
Number of reports	%	Number of reports	%	Number of reports	%	Number of reports	%
Electronic Application	111,921	47.6%	156,291	57.4%	172,394	58.6%	184,774	54.8%
Other Methods	123,339	52.4%	116,034	42.6%	121,911	41.4%	152,567	45.2%
Total	235,260	100.0%	272,325	100.0%	294,305	100.0%	337,341	100.0%

Notification rate by electronic application in 2011 was 54.8%, a decrease of 3.8 points over the previous year. JAfic has made efforts to publicize notification by electric application through workshops targeting specified business operators in order to reduce the load of the notifying person.

## Section3 Use of Suspicious Transaction Reports in 2011

## Paragraph1 Dissemination to Investigative Authorities

JAFIC stores all STRs and provides investigative authorities with the STRs reported by specified business operators that have been judged to be conducive to the investigation of money laundering offences or predicate offences. Investigative authorities are Prefectural Police, Public Prosecutors Office, Narcotics Control Department, Japan Coast Guard, Japan Customs and Securities and Exchange Surveillance Commission.

The number of reports on suspicious transactions provided to investigative authorities has been growing every year since the enforcement of the Act on Prevention of Transfer of Criminal Proceeds in 2007, which was 234,836 in 2011, an increase of 26,186 cases (12.6%) from the previous year and approximately 2.4 times the number in 2007. (See figure 4-2). There was no request for reading, duplicating, or sending copies of records of the information on suspicious transactions made by any investigative authority.

The number of disseminated reports in 2011 accounts for 69.6% of all the STRs and this percentage is a decrease of 1.3 points over the previous year. The disseminated information is used by investigative authorities to assist investigations concerning money laundering offences and predicate offences and for anti-organized crime measures including deprivation of criminal proceeds.

## Paragraph2 Outlook of How STRs are Used

The number of cases cleared by prefectural police that were initiated with information in STRs (“STR-initiated cases”) has been growing every year since the enforcement of the Act on Prevention of
Transfer of Criminal Proceeds in 2007, which was 570 in 2011, an increase of 180 cases (46.2%) from the previous year and approximately 5.8 times the number of arrests in 2007.

Table 4-4 shows the STR-initiated cases categorized by crime type.

Table 4-4 Number of STR-initiated cases by type of crime

Year	2007	2008	2009	2010	2011
Crime	81	132	265	258	360
Fraud	6	15	48	76	145
Violation of Act on Prevention of Transfer of Criminal Proceeds	2	1	2	0	1
Violation of Financial Instruments and Exchange Act	0	0	0	16	17
Violation of Stimulants Control Act	0	0	0	0	1
Violation of Stimulants Control Act and Cannabis Control Act	0	0	0	0	1
Violation of Pharmaceutical Affairs Act	0	0	0	0	2
Violation of Money Lending Business Act	2	3	1	2	3
Violation of Money Lending Business Act and Investment Deposit and Interest Rate Act	0	6	5	2	5
Violation of Investment Deposit and Interest Rate Act	1	3	3	5	2
Use of forged securities and fraud	0	0	0	0	3
Sharing of unauthorized creation of electromagnetic records of payment cards and fraud	0	0	0	0	1
Falsification and supply of electromagnetic records of officially authenticated documents	2	2	0	3	3
Forgery and/or use of a private document with signature or seal	0	0	1	1	1
Use of counterfeit currency	0	0	0	0	1
Violation of Local Tax Act	0	0	0	0	1
Violation of Immigration Act	1	3	4	5	6
Violation of Worker Dispatching Act	0	0	0	1	4
Violation of Banking Act	1	3	1	2	3
Violation of Prostitution Prevention Act	0	0	0	2	1
Distribution of obscene literature	0	0	0	0	2
Extortion	0	1	2	2	2
Receipt of stolen goods	1	0	0	2	1
Illegal entry into a building	0	0	0	0	1
Violation of Foreign Exchange Act and Customs Act	0	0	0	0	1
Violation of Customs Act	0	0	0	0	1
Violation of Trademark Act	0	1	0	2	1
Violation of Waste Disposal and Public Cleansing Act	0	0	0	1	1
Other	2	5	5	10	0
Total	99	175	337	390	570

Note 1: The formal tiles of the laws are as follows:
There was one case related to violation of intellectual property rights (violation of the Trademark Act), in which a mail-order business operator selling counterfeit branded goods was arrested for the violation of the Trademark Act.

There was one case related to illegal dumping (violation of the Waste Disposal Law), in which an arrest was made for illegal burying of waste that violated the Waste Disposal Law.

The number of cracked cases of money laundering from the STR-initiated cases in 2011 was 17 cases. STR-initiated cases by crime type shows that fraud, violation of the Money Lending Business Law, and violation of the Investment Deposit and Interest Rate Act accounted for 82.4% (see Table 4-5).

Table 4-5 The number of cases in which STR-initiated cases led to the arrest for the cases of money laundering

Year Crime	2007	2008	2009	2010	2011
Fraud	6	2	4	8	9
Violation of Money Lending Business Act	0	0	1	2	1
Violation of Money Lending Business Act and Investment Deposit and Interest Rate Act	1	6	3	0	3
Violation of Investment Deposit and Interest Rate Act	0	0	0	2	1
Violation of Prostitution Prevention Act	0	0	0	1	1
Distribution of obscene literature	0	0	0	0	1
Violation of Trademark Act	0	1	1	0	1
Other	2	0	0	4	0
Total	9	9	9	17	17

The number of STRs used for investigation by prefectural police has been growing since the enforcement of the Act on Prevention of Transfer of Criminal Proceeds in 2007, which was 105,777 in 2011, an increase of 17,717 cases (20.1%) from the previous year and approximately 4.4 times the number in 2007 (see Table 4-6).
Table 4-6 Number of STRs Used

Year	2007	2008	2009	2010	2011
Number of STRs used for investigation of initiated cases	907	668	1,261	1,642	2,674
Number of STRs used for investigation of cases other than above mentioned	23,079	44,199	68,680	86,418	103,103
Total	23,986	44,867	69,941	88,060	105,777

Note 1: "Number of STRs used for investigation of initiated cases" includes the number of all STRs used for arrest. Note 2: In cases where investigations have been initiated by using STRs but still ongoing, these STRs are counted as "STRs used for investigation of cases other than above mentioned".

Also in the investigations not initiated with STRs, many STRs are used for criminal investigation that started from a different source, for investigation into other crimes crimes, and for locating criminal proceeds. In addition, they are used as essential intelligence to promote anti organized crimes measures, such as for revealing sources of income or operation of Boryokudan's fund.

Moreover, JAFIC tries to obtain a realistic view of the movement of funds of the antisocial forces such as Boryokudan by comprehensive analysis of information contained in the STRs of customers, by matching them with other STRs related to the same customers that were reported in the past; information accumulated for organized crime, countermeasures as well as publicly available information.

These analyses have revealed that antisocial forces make use of Boryokudan affiliated companies and investment partnerships, utilize their funds in various ways and transfer a large amount of funds overseas.

Although it can be assumed that the resources of a large part of the funds handled by antisocial forces originate from criminal proceeds, there are many cases that their involvement in particular predicate offences is obscured because various fund activities or utilization in various ways make its source unclear.

As recent cases of arrests typically show, antisocial forces often use affiliated companies as cover, feign normal transactions that hide any connection with Boryokudan, receive cooperation from others who have various information and specialized knowledge, and thus use their funds. This is one of the main factors which make the fund-raising activity by antisocial forces opaque.

Therefore, in order to have a clearer vision of the actual conditions of fund-raising activities, JAFIC is convinced that it is important to continue to monitor and trace the movement of funds of antisocial forces, and to enhance the control of illegal activities committed in the course of fund-raising activities through the utilization of the analysis of STRs as well as close cooperation with authorities concerned, such as, investigative authorities, Japan Customs, Securities and Exchange Surveillance Commission and foreign FlUs.