Silviase/jgov_v1.4_full_ann huggingface dataset:
tives have established internal regulations, including basic policies, based on the government's guidelines and have introduced a clause for Boryokudan exclusion in contract documents. They are also implementing examination as to whether or not customers are antisocial forces based on the database when starting transactions.

## 5 Life Insurance Industry

The Life Insurance Association of Japan (LIAJ), of which all domestic life insurance companies in Japan are members, works to achieve appropriate operations by its member companies by incorporating countermeasures against money laundering anti-social forces in its Code of Conduct.

LIAJ has compiled the “Countermeasures Against Money Laundering and Terrorist Financing Handbook” and the “Countermeasures Against Money Laundering and Terrorist Financing FAQs” for both executives and regular employees, thereby assisting member companies in their efforts. In addition, LIAJ also devises posters and posts important points pertaining to the subject on its website.

To address the issue of anti-social forces, LIAJ has devised a directive entitled "Guidelines for Coping with Anti-social Forces in the Life Insurance Industry." With a view to dissolving insurance contracts of parties found to be anti-social forces or that are engaged with anti-social forces in a manner unacceptable to society, the LIAJ has compiled reference material for member companies entitled "Insurance Contract Rules and Regulations Regarding Anti-social Forces". In addition, the LIAJ works with the police and other external specialized institutions, creates industry databases on anti-social forces, and takes other necessary steps.

## 6 Non-Life Insurance Industry

As for the non-life insurance industry, with a view to preventing money laundering and terrorist financing, verification of customer identity procedures regarding savings-type insurance or large cash transactions exposed to a high risk of money laundering and terrorist financing have been implemented since 1990. The General Insurance Association of Japan has acted on an industry-wide basis to draw up procedures related to customer identification as well as joint creation of posters for use in store locations. The Association has also compiled a letter to inform its agencies, which constitute the main channel for the sale of non-life insurance, of the issue.

In addition, in response to the revision of the Act on Prevention of Transfer of Criminal Proceeds in 2011, the Association has compiled and distributed a set of Administrative Reference Materials for the members, in order to facilitate uniform and comprehensive verification of transactions and preparation/preservation of verification records. Moreover, as part of an effort to help customers better understand the process, the Association has set up a special page on its website, targeting general consumers, as well as compiled leaflets to be handed out to customers, both detailing additional items to be verified when a customer makes a transaction.

As a measure to address the issue of anti-social forces, the “basic policy,” which specifies
voluntary regulation following the amendment.

## 9 Fund Transfer Industry

The Japan Payment Service Association is an authorized fund settlement cooperative whose purpose is to facilitate sound development of advanced payment means issuance services and fund transfer services, as well as to protect users' profits. The Association engages in a variety of countermeasures against money laundering and terrorist financing. In 2010, the Association enacted voluntary regulations pertaining to member systems for accurate response to verification of customer identity and to suspicious transaction reporting for member of fund transfer businesses. In March 2011, the Association devised an internal regulation model, as well as a system to disseminate information on parties subject to asset freezing provided by the Financial Services Agency, also for fund transfer businesses.

In response to the revision of the Act on Prevention of Transfer of Criminal Proceeds in 2011, the Association provides advance announcements to members on information regarding the revised act, as well as providing this information on its website. The Association also takes up the issue of countermeasures against money laundering amongst its members through workshops.

## 10 Leasing Industry

The Japan Leasing Association is an industry organization for the public interest, comprised of companies engaged in the leasing business. In March 2008, following the revision of the Act on Prevention of Transfer of Criminal Proceeds, the Association compiled and distributed an educational pamphlet targeting leasing customers. In September 2012, the Association compiled and distributed a pamphlet regarding the revised Act (2011), which was also posted on its website along with related materials, in efforts to further familiarize association members with the issues.

In addition, the Japan Leasing Association holds an annual training program (advanced course), in which trainees, primarily leasing company managers, are trained in the Act on Prevention of the Transfer of Criminal Proceeds.

## 11 Credit Industry

In November 2012, the Japan Consumer Credit Association has incorporated items on verification of customer identity and on suspicious reports based on the Act on Prevention of Transfer of Criminal Proceeds into its comprehensive credit purchase regulations, requiring that its member companies comply.

Moreover, in March 2014, the Association held a workshop concerning suspicious transaction reporting under the Act on Prevention of Transfer of Criminal Proceeds, inviting personnel of the Ministry of Economy, Trade and Industry and the National Police Agency as lecturers. It is also striving to raise member companies' awareness about the enforcement of the Act on Prevention of Transfer of Criminal Proceeds by posting training materials on its website accessible only by members.
(porations) of the Certified Public Accountants Act that are indicated in the attached table of the Act on Prevention of Transfer of Criminal Proceeds or in agent work, etc. for specified mandated acts from among businesses incidental to or relating to those businesses. Regarding members engaging in said businesses, it was confirmed that they are performing such obligations as verification of identification items.

This survey is scheduled to be conducted in 2015 as well.

In addition, the association conducts member workshops, in which it provides overviews of the Act on Prevention of Transfer of Criminal Proceeds and countermeasures against money laundering.

## Section 2 Collaboration with the private sector

## Paragraph 1 AML/CFT Workshop for Information sharing and feedback in 2014

## 1 Workshops for Financial Institutions

The National Police Agency jointly held with the Financial Services Agency, the “Suspicious Transaction Reporting Workshop” for financial institutions 14 times, at a total of 12 places around the country, from October to November 2014, where they gave feedback learned from case studies of actual investigations involving STR information and advice with regard to key points in performing the reporting work.

Personnel of the National Police Agency visited 62 banks and other financial institutions across Japan and provided explanations regarding example cases of suspicious transaction reporting and points of attention.

## 2 Workshops for Credit Card Companies

In March 2014, the Ministry of Economy, Trade and Industry and the National Police Agency sent personnel to a workshop held by the Japan Consumer Credit Association for credit card companies to provide explanations concerning the overview, etc. of the Act on Prevention of Transfer of Criminal Proceeds.

## 3 Workshops for Postal Receiving Service Providers

From January to February 2014, a total of three workshops for postal receiving service providers were held in two locations across the country jointly by the Ministry of Economy, Trade and Industry and the National Police Agency in order to explain the overview of the Act on Prevention of Transfer of Criminal Proceeds.

## 4 Sending Notification to Telephone Forwarding Service Providers

In August 2014, the Ministry of Internal Affairs and Communications sent to telephone forwarding service providers a notification of the overview of the Act on Prevention of Transfer of Criminal Proceeds and verification items at the time of transactions in order to raise
awareness about information that they need to acquire as telecommunications business operators.

In March and April 2013, workshops for telephone receiving service providers and telephone forwarding service providers were held in four locations across the country jointly by the Ministry of Internal Affairs and Communications and JAFlC in order to explain the overview and important points of the Act on Prevention of Transfer of Criminal Proceeds.

## 5 Seminars for Judicial Scriveners

The National Police Agency dispatched its officers to seminars for judicial scriveners, which were held by the Japan Federation of Shiho-Shoshi Lawyer’s Associations from March to November 2014 in three locations across Japan, and provided explanations on the outline of the Act on Prevention of Transfer of Criminal Proceeds.

## 6 Publication of List of Reference Cases of Suspicious Transactions

Competent administrative authorities published the “List of Reference Cases of Suspicious Transactions,” which indicates red flags to which the business operators should pay particular attention to find any suspicious activities behind them when performing the reporting obligation, and published the revised list.

## 7 PR on Website

The website of JAFIC has been created within the National Police Agency website, and its annual reports, the current status of JAFIC's activities, and a description of the Act on Prevention of Transfer of Criminal Proceeds are made available for public viewing.

## Website of the National Police Agency

http://www.npa.go.jp

Website of JAFIC

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

JAFIC Annual Report
## Paragraph 2 Calling for actions by Specified Business Operators upon the adoption of the United Nations Security Council Resolutions

When the United Nations Security Council adopts a resolution requiring countries to freeze the funds or other assets related to any persons or entities in order to prevent and suppress terrorism and terrorist financing, the National Police Agency, in cooperation with relevant Ministries and Agencies, shall disseminate the content to specified business operators (excluding lawyers, judicial scriveners, certified administrative procedures legal specialists, certified public accountants and tax accountants; the same applies in this paragraph) and request the thorough reporting of CDD and suspicious transactions on persons or entities subject to the resolutions concerned. And, the targeted persons or entities shall be listed on the website of JAFIC.

## 1 Measures based on the United Nations Security Council resolutions (UNSCRs)

Japan implements targeted financial sanctions to freeze assets of persons or entities associated with the Taliban according to UNSCRs concerned. Every time the list of such parties is revised, the National Police Agency requires specified business operators through supervisory authorities to pay due diligence and ensure the reporting of all suspicious transactions. Such a requirement was made a total of nine times in 2014.

## 2 Measures based on the FATF Public Statement

The FATF Plenary held in February, June and October 2014 adopted the Statement which called on all FATF members and other jurisdictions to apply countermeasures to protect the international financial system from money laundering and terrorist financing risks emanating from Islamic Republic of Iran and North Korea. In response, the National Police Agency has issued a notice through supervisory authorities that specified business operators should properly perform CDD and reporting suspicious transactions.

The Plenary also adopted a statement concerning the jurisdictions having strategic deficiencies in the measures against money laundering and terrorist financing, to which the National Police Agency referred in the notice above.

## Paragraph 3 Evaluation on Risk Level of Transfer of Criminal Proceeds

## 1 Backgrounds

In modern society, where the advance of IT and the globalization of economic activities and financial services are proceeding, the situation surrounding money laundering and terrorist financing is constantly changing. To strenuously implement AML/CFT, global actions based on cooperation between countries need to be taken.

The FATF Recommendations revised in February 2012 (new FATF 40 Recommendations) call on individual countries to identify and assess risks of money laundering, etc. for the country.
In light of the fact that companies and legal arrangements are being misused for money laundering and tax evasion due to a lack of transparency over their ownership and control, at the G8 Lough Erne Summit held in June 2013, an agreement was reached on the G8 Action Plan Principles to prevent the misuse of companies and legal arrangements, which calls for concrete actions including that authorities should understand the risks to which their AML/CFT regime is exposed and implement proportionate measures to target those risks.

Responding to the G8 agreement, Japan expressed its strong commitment to AML/CFT by issuing the national action plan in the same month declaring that the government would establish an inter-ministerial working team with the Financial Service Agency on board under the chair of the National Police Agency with a view to completing the works on the national risk assessment by the end of 2014.

## 2 Purpose

The national risk assessment should serve as a basis of the risk-based approach which specified business operators apply in order to perform AML/CFT measures more effectively and efficiently in a way commensurate with the level of risk of each transaction and the customer or business relationship identified through the national risk assessment.

## 3 Publication of Assessment Report and Overview

Relevant ministries and agencies are working together to assess the national risk through the Working Group on the National Risk Assessment of Money Laundering and Terrorist Financing that was established in July 2013 as a subcommittee of “the Related Ministry Liaison Conference regarding Implementation of FATF Recommendations.” In December 2014, the “National Risk Assessment of Money Laundering and Terrorist Financing” (hereinafter referred to as the “Assessment”) was published.

The Assessment analyzed the specific characteristics of the following risk factors, measures taken, and example cases of arrest and indicated the risk level. The Assessment is available on JAFIC's website.

Factors related to transaction type

Non-face-to-face transactions, cash transactions, etc.

Factors related to customers

Antisocial forces, non-residents, individuals who are or have been entrusted with a prominent public function in a foreign country (Politically Exposed Persons), etc.

Factors related to countries and regions

Countries and regions regarding which the FATF Public Statement pointed out deficiencies of measures against money laundering

OFactors related to products and services

Transactions related to deposit and savings accounts, domestic exchange, safe deposit boxes, bills, cheques, foreign currency exchange, etc.
# Section 3 Progress of the collection of reports and opinion statements in 2014

When suspicion surfaces during the investigation of special fraud cases by the Prefectural Police with regard to the possibility that a specific business operator (excluding lawyers; the same applies in this section) violates the obligation of customer identity verification and other matters prescribed in the Act on Prevention of Transfer of Criminal Proceeds, JAFIC makes requests to the alleged specified business operators for submission of reports, gives directions to the relevant prefectural Police on necessary inquiry, and makes opinion statements to competent administrative authorities.

## 1 Collection of Reports and Opinion Statements by JAFIC

In 2014, JAFIC made 10 requests to submit reports to Postal Receiving Service Providers, and gave 5 directions to Prefectural Police to make necessary inquiries on the violation of specified business operator's obligation to pay due diligence in making transactions. In addition, based on the result of the past report collection, JAFIC issued 11 opinion statements to competent administrative authorities in charge of supervising specified business operators; specifically, nine statements to the Minister of Economy, Trade and Industry, which is the authority over postal receiving service providers; and two to the Minister of Internal Affairs and Communications, which is the authority over telephone forwarding service providers. The purpose of these statements is to encourage these authorities to take necessary measures that will rectify the violations of the Act by their supervising specified business operators. No on-site inspections by police officers were performed.

Table 3-1 Number of supervisory actions

Year	2010	2011	2012	2013	2014
Number of requests to submit reports to specified business operators	7	5	9	11	10
Number of directions to conduct inquiry to prefectural police	10	3	3	1	5
Number of opinion statements made to competent administrative authorities	13	10	10	10	11

## 2 Issuing of Rectification Order by Competent Administrative Authorities Based on Opinion Statements

In 2014, in light of Opinion Statements issued by JAFIC, the Minister of Economy, Trade and Industry issued three Rectification Orders to postal receiving service providers.
Figure 4-1 Flow of STRs from Specified Business Operators, through JAFIC to Investigative Authorities

## 3 When STRs are Required

Under Article 8 of the Act on Prevention of Transfer of Criminal Proceeds, it is required that specified business operators promptly file an STR with the competent administrative authorities when there is any suspicion, taking into account information obtained through CDD that assets they received could be criminal proceeds or that the customer could commit money laundering (i.e. violations of Article 10 of the Act on Punishment of Organized Crimes or Article 6 of the Anti-Drug Special Provisions Law).

Figure 4-2 Cases where STRs are required
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 by the terminal device. 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 device is denied to prevent unauthorized use.

## (3) Surveillance of Terminal Device

All processing operated at the terminals, such as access to information and printing of query results, 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 Terminal Device

Each terminal device 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 Device’s Hard Disk Drive Information

The hard disk drives on the terminal device that are used to access the database system are all encrypted. Hence, 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.

## Section 2 Situation of STR filings in 2014

## 1 Transition of the Number of STR filings

Although the suspicious transaction reporting system was established with the enforcement of the Anti-Drug Special Provisions Law in 1992, less than 20 reports were received 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, crimes subject to suspicious transaction reports were extended besides drug-related crimes to include other serious crimes as specified by the act, and the number of reports received exceeded 1,000 cases in the same year. Since the enforcement of the Act on Punishment of Organized Crimes in the year 2000, the number of reports has increased every year, and has kept increasing since the partial enforcement of the Act on Prevention of Transfer of Criminal Proceeds in 2007. The number of reports received in 2014 was 377,513, increasing by 28,152 cases (8.1%) from the previous year (see Figure 4-3).
Figure 4-3 Trend Diagram of Number of STRs (2005-2014)

Note 1: "Number of Reports Received" (2003-2012) is the total number of the reports received by the Financial Services Agency (JAFIO) until March 2007 and those received by the National Public Safety Commission/the National Police Agency (JAFIC) after April 2007.

Note 2: “Number of Reports Disseminated” (2002-2011) is the total number of the reports disseminated by JAFIO to the National Police Agency until March 2007 and those disseminated by JAFIC to investigative authorities etc. after April 2007.

As a possible underlying factor of this trend, the following can be raised.

○Spreading compliance culture among the general public has encouraged financial institutions’ efforts in fighting against anti-social forces and applied stringent monitoring over their financial or other economic activities.

The effect of education on the necessity of reporting suspicious transactions, via seminars, etc. held for financial institutions, etc.

Specifically, financial institutions have allocated much more resources to various AML/CFT measures. In particular, financial institutions with larger submission of STRs are promoting training programs for their employees to improve the individual AML/CFT capability, while having strengthened the IT system to identify suspicious transactions, by increasing the number of personnel in charge of money laundering countermeasures and the introduction of the detection systems for suspicious transactions.

No file of STRs was deleted in 2014.

## 2 Number of Received Reports by Business Types

The number of suspicious transaction reports that each category of business operators filed in 2014 is shown in Table 4-1. Banks etc. have the highest number of reports with 332,443 cases, or 88.1% of all reports, followed by Shinkin banks and credit cooperatives (15,018 cases, or 4.0%), and credit card operators (10,608 cases, or 2.8%) (see Table 4-1).