Silviase/jgov_v1.4_full_ann huggingface dataset:
Chapter4 Reports of Suspicious Transactions 27
Section1 Outline of the Suspicious Transaction Reporting System 27
1 Purpose 27
2 Cases in which Reporting is Required 27
3 Announcement of List of Reference Cases of Suspicious Transactions (Guideline) 27
4 Analysis of Bank Account used for Crime 28
5 Flow of Suspicious Transactions Reporting 28
6 Information Security Measures 28
Section2 Situation of Suspicious Transaction Reports in 2011 29
1 The change in the number of reported cases 29
2 Number of Reports by Business Types 30
3 Number of notification cases classified by notification methods 32
Section3 Use of Suspicious Transaction Reports in 2011 32
Paragraph1 Dissemination to Investigative Authorities 32
Paragraph2 Outlook of How STRs are Used 32
Chapter5 Promotion of International Cooperation 37
Section1 Activities of International Institutions 37
Paragraph1 FATF 37
1 FATF 37
2 Activities of FATF 37
3 Participation of JAFIC in FATF 38
Paragraph2 APG 39
1 APG 39
2 Activities of APG 39
3 Participation of JAFIC in APG 39
Paragraph3 Egmont Group 39
1 Egmont Group 39
2 Various Meeting of the Egmont Group 40
3 Participation of JAFIC in the Egmont Group 40
Section2 Progress of the International Cooperation in 2011 40
Paragraph1 Participation in the Activities of International Organizations 40
Paragraph2 Status of Information Exchange with Foreign FIUs 41
1 Establishment of the Framework for Exchange of Information 41
2 Status of Information Exchange with Foreign FIUs 42
3 Discussions with foreign FIUs 43
Paragraph3 FATF Mutual Evaluation of Japan 43
1 Implementation of the Third FATF Mutual Evaluation of Japan 43
2 Outline of the Mutual Evaluation Results 44
3 Follow-up of the Mutual Evaluation Results 44
(1) Follow-up Procedures 44
(2) Report on Improvement 44
Chapter6 Trends in Offences Related to Money Laundering in 2011 46
Section1 Arrests made for the violation of the Act on Prevention of Transfer of Criminal Proceeds (illicit transfer of savings passbooks etc.) 46
Section2 Cleared Cases of Money Laundering 47
Paragraph1 Cleared Cases of Money Laundering under the Act on Punishment of Organized Crimes 47
1 Number of Cleared Cases 47
2 Modus Operandi of Money Laundering observed in Cleared Cases 48
3 Money Laundering cases related to Members of the Boryokudan gangsters 50
4 Money Laundering conducted by Foreign Visitors to Japan 52
Paragraph2 Cleared Cases of Money Laundering under the Anti-Drug Special Provisions Law 53
Section3 Temporary Restraining Order for Confiscation of Criminal Proceeds before Institution of Prosecution 53
Paragraph1 Temporary Restraining Order under the Act on Punishment of Organized Crimes 54
Paragraph2 Temporary Restraining Order under the Anti-Drug Special Provisions Law 56
Section4 Application of Provisions of Confiscation and Collection of Equivalent Value 57
Paragraph1 Application of Provisions of Confiscation and Collection of Equivalent Value under the Act on Punishment of Organized Crimes 57
Paragraph2 Application of Provisions of Confiscation and Collection of Equivalent Value under the Anti-Drug Special Provisions Law 58
Figure 2-1 Relationships of the Act on Prevention of Transfer of Criminal Proceeds, Act on Punishment of Organized Crimes, and the Anti-Drug Special Provisions Law
transaction records or the like, and reporting of suspicious transactions by specified business operators, as described in 3, coupled with other measures stipulated by the Act on Punishment of Organized Crimes and the Anti-Drug Special Provisions Law.

## 2 Criminal Proceeds (Paragraph 1 of Article 2)

The term "criminal proceeds" as used in this Act means criminal proceeds etc. prescribed in Article 2, paragraph 4 of the Act on Punishment of Organized Crimes or drug-related criminal proceeds etc. prescribed in Article 2, paragraph 5 of the Anti-Drug Special Provisions Law.

## 3 Specified Business Operators (Paragraph 2 of Article 2)

Business operators, required to take measures like customer identification by this act, are called "Specified business operator," the scope of which is defined in line with the FATF Recommendations as well as in consideration of business practices in Japan. Generally, financial institutions etc. had already been obliged to undertake identical measures by the Customer Identification Act (abolished by enforcement of the Act on Prevention of Transfer of Criminal Proceeds) and other regulations.

○Financial institutions, etc. (Item 1 through 33):

Bank; Shinkin bank; Federation of Shinkin banks; Labor bank; Federation of labor banks; Credit cooperative; Federation of credit cooperatives; Agricultural cooperative; Federation of agricultural cooperatives; Fishery cooperative; Federation of fishery cooperatives; Fishery processing cooperative; Federation of fishery processing cooperatives: Norinchukin Bank; Shokochukin Bank; Development Bank of Japan; Insurance company; Foreign insurance company, etc.; Small-claims/short term insurance business operator; Federation of fishery cooperatives for mutual aid; Financial instruments business; Securities finance company; Specially permitted business notifying person; Trust company; Self-trusted companies; Real estate specified joint enterprise operator; Mutual loan company; Money lender; Call money market broker; Fund transfer companies, Futures commission merchant; Book-entry, transfer institution; Account management institution; electronic receivables recording organizations; Management Organization for Postal Savings and Postal Life Insurance; Currency exchanging operator

○Financial leasing operator (Item 34)

○Credit card operator (Item 35)

Real estate agents (Item 36)

○Dealers in precious metals and stones (Item 37)

○Postal receiving service providers or a service of receiving telephone call (Item 38)

○Lawyer or legal profession corporation (Item 39)

○Judicial scrivener or judicial scrivener corporation (Item 40)

○Certified administrative procedures specialists or administrative scrivener corporation (Item 41)

○Certified public accountant or audit firm (Item 42)

○Certified public tax accountants or certified tax accountant corporation (Item 43)

## 4 Responsibilities of the National Public Safety Commission and FIU (Article 3)

This Act provides that the National Public Safety Commission has responsibilities to endeavor 1)to enhance public awareness on the importance of the prevention of the transfer of criminal proceeds in
These obligations are classified by the types of business operators in Table 2-1. Also, "Specified Business Affairs" subject to obligations and "Specified Transactions" subject to customer identification obligation are listed in Table 2-2.

Customer identification, preparation and preservation of customer identification records and transaction records described in (1) through (3) above are expected to work as warnings against persons who attempt to transfer criminal proceeds and to enable tracing proceeds afterwards. Suspicious transaction reports described in (4) will be used for investigations into money laundering offences and predicate offences and will prevent criminals from abusing economic and financial systems, so that its soundness can be assured. The purpose of notification pertaining to foreign exchange transactions described in (5) is to enable tracing funds internationally and also to respond to the FATF Special Recommendations regarding terrorist financing.

Table 2-1 Measures of Specified Business Operators Obliged by the Act

Specified Business Operators (Paragraph 2 of Article 2)	Customer identification (Article 4)	Preparation and preservation of customer identification records (Article 6)	Preparation and preservation of transaction records (Article 7)	Reporting of suspicious transactions (Article 9)
Financial Institutions etc. (Item 1 through 33)	○	○	○	○
Financial Leasing Operators (Item 34)
Credit Card Operators (Item 35)
Real Estate Agents (Item 36)
Dealers in Precious Metals and Stones (Item 37)
Postal Receiving Service Providers (Item 38)
Telephone Receiving Service Providers
Judicial Scriveners (Item 40)
Certified Administrative Procedures Specialists (Item 41)
Certified Public Accountants (Item 42)
Certified Public Tax Accountants (Item 43)
Lawyers (Item 39)	To be prescribed in the Rules of the Japan Federation of Bar Associations in line with cases of judicial scriveners etc. (Article 8)
## 6 Dissemination of Information on Suspicious Transactions (Article 11 and 12)

In order to make use of information on suspicious transactions for domestic and overseas investigation etc., the National Public Safety Commission may disseminate information to authorities in charge of investigating criminal cases such as public prosecutors assistant officers to prosecutors, judicial police officials (police officers, narcotics control agents and coast guards), customs officers and personnel of the Securities and Exchange Surveillance Commission and to a foreign Flu under certain conditions. The STR regime will be detailed in Chapter 4 (Reports of Suspicious Transactions) and Chapter 5(Promotion of International Cooperation).

## 7 Supervisory Measures (Article 13 through 17, 23, 24, 27)

The law provides inspection power to competent administrative authorities so that they can detect irregularities by specified business operators. The authorities can also employ various supervisory methods etc. such as guidance, advice, suggestion, and order for rectification in the case of violation for a better compliance by specified business operators.

Persons who have failed to submit reports or materials, or submit false reports or materials, or who refused on-site inspections, shall be punished with imprisonment with labor for not more than one year or a fine of not more than three million yen or both. A person who violates an order for rectification shall be punished with imprisonment with labor for not more than two years or a fine of not more than three million yen or both.

Moreover, to complement supervisory function, the National Public Safety Commission is authorized to state its opinion to competent administrative authorities (and make necessary inspections on business operators) when it detects violations.

### 8 Penal Provisions regarding Reception/Delivery/Provision of Deposit/Savings Passbooks, Exchange Transaction Cards etc. (Article 26 and 27)

Sold or bought deposit/savings passbooks, ATM cards, Exchange Transaction Cards etc. can be sold, bought, and misused in various crimes such as money laundering. In order to prevent this, this act regulates persons who take over, receive or obtain a deposit/savings passbook etc. for value or for free, shall be punished with imprisonment with labor for not more than one year or a fine of not more than one million yen or both and a man who has committed, as a business, these crimes shall be punished by imprisonment with work for not more than three years or a fine of not more than five million yen or both.

Furthermore, persons who invite or solicit another party to assign, deliver or provide a deposit/savings passbook etc., for value or onerously, shall be punished imprisonment with labor for not more than one year or a fine of not more than one million yen or both.

As mentioned in the next Section, penalties for such crimes have been increased since May 2011.
Figure 2-3 Outline of the Act on Prevention of Transfer of Criminal Proceeds

Figure 2-4
Figure 2-5 Overview of the amendment of the Act on Prevention of Transfer of Criminal Proceeds (FATF-related section)

Figure 2-6 Overview of the amendment of the Act on Prevention of Transfer of Criminal Proceeds (section other than FATF-related)

Imprisonment with labor for not more than two years or a fine of not more than three million yen or both.

○ Act of falsifying identification information

A fine of not more than a half million yen

Imprisonment with labor for not more than one year or a fine of not more than one million yen or both

Imprisonment with labor for not more than three years or a fine of not more than five million yen or both

Imprisonment with labor for not more than one year or a fine of not more than one million yen or both
### 2. Amendment of the enforcement regulation for the Act on Prevention of Transfer of Criminal Proceeds associated with the Great East Japan Earthquake

In view of the damage caused by the Great East Japan Earthquake, the enforcement regulation for the Act on Prevention of Transfer of Criminal Proceedings was amended in March 2011 to establish an exception to the methods of personal identification that would allow those customers of whom identification based on the formal methods would be difficult due to reasons such as a loss of all of their identification documents in the disaster to identify themselves through declaration for the time being. In addition, cash remittance to bank accounts opened for the purpose of receiving donations for the victims of the disaster in an amount not more than two million yen would be excluded from the transactions subject to personal identification.

### 3. Amendment of the enforcement regulation of the Act on Prevention of Transfer of Criminal Proceeds according to the enactment of ordinances of the Ministry of Agriculture, Forestry and Fisheries (MAFF), Ministry of Economy, Trade and Industry (METI), and other related ministries associated with the enforcement of the Act to Partially Amend the Commodity Exchange Act and the Act for Regulations of Business Concerning Commodities Investment and the enforcement of ordinances related to interim measures

The enforcement regulations of the Act on Prevention of Transfer of Criminal Proceeds was amended in June 2011 in connection with the enactment of ordinances of the MAFF, METI, and other related ministries associated with the enforcement of the Act to Partially Amend the Commodity Exchange Act and the Act for Regulations of Business Concerning Commodities Investment to exclude the trust agreements signed by commodity futures traders with trust companies for the margins deposited by their customers from the transactions subject to personal identification.
STRs including their dissemination to foreign FIUs as well as a function to complement supervisory measures against specified business operators. JAFIC was established within the Organized Crime Department, the Criminal Investigation Bureau of the National Police Agency, as a new Japan's FIU to perform these functions.

## Section2 Mission and Structure

JAFIC is in charge of the following tasks provided in the Act on Prevention of Transfer of Criminal Proceeds:

- Collection, arrangement, analysis and dissemination of information on suspicious transactions to investigative authorities etc.

- Dissemination of information to foreign FIUs;

- Provision of information and complement of supervisory measures by administrative authorities to ensure that specified business operators take required measures;

JAFIC also plans and examines the legal system related to AML and various measures such as "the Guideline for Promotion of the Criminal Proceeds Control" etc. described in Section 4. It also participates in discussion of international standards related to AML measures.

Among these tasks, the status of the analysis and dissemination of STRs will be explained in Chapter 4, while cooperation with foreign FLUs and international institutions will be described in Chapter 5.

The structure of JAFIC is illustrated in Fig. 3-1. It is currently composed of about 90 employees under the Director for prevention of Money Laundering.

On the other hand, the "Task Force specializing in resolving criminal proceeds" is established in each Prefectural Police in charge of tracing criminal proceeds and investigating money laundering crimes etc.

Figure3-1 Structure of JAFIC
## Section3 JAfic and Partners

Specified business operators including financial institutions should take initial anti-money laundering measures according to the Act on Prevention of Transfer of Criminal Proceeds. As stated in this chapter separately, in addition to the analysis of financial intelligence, JAFIC endeavors to publicize the actual conditions of money laundering and legal systems and relevant countermeasures so that specified business operators can take the proper actions and gain cooperation from the public. Relevant ministries and agencies in charge of supervising business operators not only exercise the supervisory function to secure the fulfillment of obligations, but also provide supports by issuing Lists of Reference Cases of Suspicious Transactions and holding seminars in cooperation with industry organizations. On the other hand, investigative authorities, such as the police, detect money laundering offences and predicate offences and, as a result, confiscate criminal proceeds within their respective jurisdictions.

These ministries and agencies carry out their duties in each position, while also cooperating with each other by exchanging useful information, discussing issues in preventing money laundering and other ways.

Also, for the purpose of promoting effective and appropriate measures against transnational organized crimes and international terrorism in a comprehensive and active manner, the "Headquarters for the Promotion of Measures against Transnational Organized Crime and International Terrorism" was established in a Cabinet Meeting in August 2004. In addition, the "Ministerial Meeting Concerning Measures against Crime" which was started by the cabinet meeting agreement in September 2003, frequently discusses anti-money laundering measures.

Figure 3-2 Anti-money Laundering Measures in Each Governmental Organization
# Section5 Efforts in Cooperation with Business Operators, and the Public, and Related Authorities Made in 2011

### Paragraph1 Explanation and Provision of Information etc. on Seminars Targeting Specified Business Operators

## 1 Explanation on Seminars for Postal Receiving Service Providers

Between February and March 2011, the “Briefing on the Act for the Prevention of Transfer of Criminal Proceeds” seminars was held by the Ministry of Economy, Trade and Industry, at ten locations in Japan, and JAFIC officials explained the outline of the law, obligations imposed on specified business operators etc.

Explanation at a Seminar

## 2 Explanation on Workshops for Fund Transfer Business Operators

In February 2011, the Japan Payment Service Association held a seminar in Tokyo for all of its members that are fund transfer business operators throughout Japan, and JAFIC officials explained the outline of the Act on Prevention of Transfer of Criminal Proceeds, obligations imposed on specified business operators etc.

## 3 Explanation on Workshops for Real Estate Agents

The NPA jointly held with the Financial Services Agency, “Suspicious Transactions Reporting” seminars for financial institutions 18 times, in total at 12 places around the country, from September to November 2011, where cases of STRs, utilized by investigative authorities, and points which should be kept in mind when filing the report etc., and provided them with information related to suspicious transactions reporting by way of answering questions made by employees of financial institutions.

In December 2011, a seminar for foreign banks was held in Tokyo, and JAFIC officials gave a lecture regarding the elimination of antisocial forces, obligations of specified business operators etc.
## 4 PR on Website

The website of JAFIC has been created in the National Police Agency website, which publicizes the annual report, JAFIC’s activities, and description of the Act on Prevention of Transfer of Criminal Proceeds.

Website of JAFIC

Website of the National Police Agency

http://www.npa.go.jp

## Website of JAFIC

http://www.npa.go.jp/sosikihanzai/jafic/index.htm

## Paragraph2 Requests Made to Specified Business Operators following the Resolution of the United Nations Security Council

When, the United Nations Security Council newly adopts a resolution on measures for freezing the assets related to person or organization deemed to be involved in terrorism etc., the National Police Agency, in cooperation with relevant Ministries and Agencies, shall disseminate the content to specified business operators and request the thorough implementation of the fulfillment of customer identification obligation and suspicious transaction reporting obligation on the person or organization whose assets etc. can be targeted for freezing. And, the targeted persons or organizations of the said measures shall be listed on the website.

### 1. Measures based on the resolutions of the United Nations Security Council

Japan imposes asset freezing measures on parties associated with the Taliban according to the resolutions of the United Nations Security Council. Every time the list of such parties is revised, the National Police Agency requires specified business operators through supervisory authorities to fulfill
their obligation of customer due diligence and ensure the reporting of all suspicious transactions through related government offices. Such a requirement was made in a total of six times in 2011.

### 2. Measures based on the FATF Public Statement

The Plenary Meeting of the FATF held in February 2011 adopted the Statement which calls on all FATF members and other jurisdictions to apply countermeasures to protect the financial system from the money laundering and terrorist financing risks emanating from Islamic Republic of Iran and North Korea. In response, the National Police Agency has required through supervisory authorities that specified business operators fulfill their obligation of customer due diligence and ensure the reporting of all suspicious transactions.

The FATF Plenary Meetings held in June and October 2011 also adopted a statement concerning the jurisdictions having strategic deficiencies in the measures against money laundering and terrorist funding. The National Police Agency consequently made the same requirement through supervisory authorities.

## Section6 Progress of the collection of reports and opinion statements in 2011

When suspicion surfaces during the investigation of Frikome fraud or other crimes by the Prefectural Police with regard to the violation of the obligation of customer identification and other matters prescribed in the Act on Prevention of Transfer of Criminal Proceeds, the National Public Safety Commission/the National Police Agency (JAFIC) makes requests to the alleged specified business operator for submission of reports or gives directions to the relevant prefectural Police on necessary inquiry.

In 2011, the National Public Safety Commission/the National Police Agency made 5 requests to submit report to Postal Receiving Service Providers etc., and gave 3 directions to Prefectural Police Departments to make the necessary inquiry. In addition, based on the result of the past report collection, the National Public Safety Commission/the National Police Agency made 10 opinion statements to encourage the Ministry of Economy, Trade and Industry to take necessary measures which will rectify the violation of the Act by its supervised specific business operators. In accordance with the previous opinion statements of the National Public Safety Commission / the National Police Agency, the Minister of Economy, Trade and Industry issued 9 rectification orders to postal receiving service providers.

No on-site inspections were performed in 2011.

Table 3-1 Implementation of Request to submit report etc. by the National Public Safety Commission/ the National Police Agency

2008	2009	2010	2011
Number of requests to submit reports to the specified business operators	11	16	7	5
Number of directions to conduct inquiry to the prefectural police	1	2	10	3
Number of stating opinions to the competent administrative agencies	4	9	13	10

Note: The reports and statements of 2008 are those made after March 1.