Silviase/jgov_v1.4_full_ann huggingface dataset:
## 2 | Number of Reports by Business Types

The number of suspicious transaction reports that each category of businesses filed in 2007 is shown in table 4-2. Banks have the highest number of reports with 133,699 cases, or 84.6% of all reports, followed by the Japan Post (11,859 cases, 7.5%), and credit unions and credit associations (10,237 cases, 6.5%).

Table 4-2 Number of Suspicious Transaction Reports by Business Types

Business Type	2006	2007	Increase/Decrease rate
Number of reports	Percentage	Number of reports	Percentage	Number of reports	Percentage
Bank	93,426	82.1%	133,699	84.6%	40,273	43.1%
Japan Post	10,509	9.2%	11,859	7.5%	1,350	12.8%
Credit Union, Credit Association	8,136	7.1%	10,237	6.5%	2,101	25.8%
Securities Company	656	0.6%	1,174	0.7%	518	79.0%
Money Lending Business	805	0.7%	397	0.3%	-408	-50.7%
Agriculture and Forestry	89	0.1%	294	0.2%	205	230.3%
Labour Bank	86	0.1%	189	0.1%	103	119.8%
Insurance Company	33	0.0%	48	0.0%	15	45.5%
Other	120	0.1%	144	0.1%	24	20.0%
Total	113,860	100.0%	158,041	100.0%	44,181	38.8%

Note: "Japan Post" includes the "Japan Post Bank" and "Japan Post Insurance."

## 3 | Number of Reports by Branch Locations

Locations of branches (stores) of financial institutions that filed suspicious transaction reports are shown in figure 4-3 and table 4-4. Tokyo has the most with 44,817 reports, or 28.4% of all reports, followed by Osaka Prefecture with 16,097 cases (10.2%), and Kanagawa Prefecture with 10,007 cases (6.3%).

The top 10 prefectures are concentrated in large cities, presumably due to the fact that the population, scale of economy and the number of transactions are larger.

In 40 prefectures reports increased from the year before. In particular, in Kagoshima Prefecture 3.2 times more reports than 2006 were filed. Reports in Tochigi, Aichi, Nara, Okayama, Nagasaki and Ooita also more than doubled. This shows that both city banks and local financial institutions are improving AML measures.
Figure 4-3 Number of Suspicious Transaction Reports by Prefectures, in 2007

Table 4-3 Number of Suspicious Transaction Reports by Prefectures

Prefecture	Number of reports in 2006	Number of reports in 2007	Increase/decrease between 2006 and 2007 (number of reports)	Increase/decrease between 2006 and 2007 (%)	Average number of reports for one office
Tokyo	37,152	44,817	7,665	20.6%	5.63
Osaka	10,179	16,097	5,918	58.1%	3.64
Kanagawa	7,571	10,007	2,436	32.2%	3.42
Aichi	4,271	8,708	4,437	103.9%	2.29
Hokkaido	4,883	8,489	3,606	73.8%	2.01
Chiba	6,764	7,764	1,000	14.8%	3.38
Saitama	5,370	7,248	1,878	35.0%	2.98
Hyogo	3,084	4,335	1,251	40.6%	1.46
Fukuoka	2,624	3,916	1,292	49.2%	1.30
Shizuoka	2,403	3,840	1,437	59.8%	1.71
Total of top 10 prefectures	84,301	115,221	30,920	36.7%	3.17
Total of other 37 prefectures	29,559	42,820	13,261	44.9%	1.04
Total	113,860	158,041	44,181	38.8%	2.04

Note: The number of offices of financial institution was taken from "Statistical Survey of Business and Companies in 2006-Total Number of Businesses by Industry (Sub-category) of Prefectural Statistics," General Affairs Ministry. This does not exactly correspond to the number of offices subject to STR requirement.
## Section3 Use of Suspicious Transaction Reports

## Paragraph1 Dissemination to Investigative Authorities

JAFIC provides investigative authorities with STRs that it judged to be conducive to the investigation of money laundering and predicate offences. Investigative authorities are Prefectural Police, Public Prosecutors Office, Narcotics Control Department, Japan Coast Guard, and Customs and Securities and Exchange Surveillance Commission.

In 2007, 98,649 reports were disseminated to investigative authorities, an increase of 27,408 (38.5%) compared to the previous year (See figure 4-2).

The number of disseminated reports amount to 62.4% of all the STRs and this ratio stays almost the same over the past several years.

## Paragraph2 Outlook of How STRs are Used

The number of cases cleared by prefectural police that were initiated with STRs is increasing each year, after the enforcement of Organized Crimes Punishment Law, with 99 cases in 2007, about twice the number in 2006.

The total number of cases since 2000 is 225.

Table 4-4 Number of cases cleared that started with Suspicious Transaction Reports

2000	2001	2002	2003	2004	2005	2006	2007	Total
3	14	16	12	13	18	50	99	225

Note: This is the number held by National Police Agency

Table 4-5 shows the numbers categorized by the type of crime, and fraud has the largest number making up 81.8%.

Table 4-5 Number of cases cleared that started with Suspicious Transaction Reports by the types of crimes

Year Crime	2000	2001	2002	2003	2004	2005	2006	2007	Total
Fraud	2	3	2	4	6	14	34	81	146
Violation of Immigration Control and Refugee Recognition Act	2	5	1	2	12	1	23
Violation of Banking Act	1	3	3	4	1	1	1	14
Violation of Money-Lending Business Law and Law Concerning Receiving of Capital	1	3	3	1	2	3	13
Forgery of documents	2	1	2	1	2	8
Other	3	5	1	1	11	21
Total	3	14	16	12	13	18	50	99	225
For the 99 cases above, 907 STRs were utilized. Other than these STRs, 23,079 STRs were utilized by prefectural police in 2007. Many of them are being used for criminal investigation that started with the STRs but are still under investigation, for criminal investigation that started from a different source, for locating criminal proceeds, and for revealing sources of income of Boryokudan.

Table 4-6 Number of STRs used in 2007

Number of STRs used for cases cleared that started with information contained therein 907

Number of STRs used for other AML/CFT actions 23,079

Note: STRs disseminated before 2007 are included.

JAFIC analyzes information contained in STRs by matching with other relevant STRs, various police information including that of antisocial syndicates and Boryokudan, as well as publicly available information. These analyses have revealed transfers of large amounts of funds that antisocial syndicates had made through overseas remittances and by making use of Boryokudan affiliated companies, investment partnerships and other kinds of corporate vehicles.

Although it can be assumed that a large part of the funds handled by antisocial syndicates sometimes clearly originate from criminal proceeds, proving it is often difficult because their relationship with particular predicate offences is obscured through various means of "layering". As recent cases of arrests typically show, criminal organizations often use affiliated companies as cover, feign normal transactions that hide any connection with Boryokudan, receive cooperation from others that provide various information and specialized knowledge, and are obtaining a great sum of profit by taking advantage of companies that are in financial hardships or through market manipulation or other illegal means that hinder the fairness of securities markets.

Therefore, 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 it through the utilization of the analysis of STRs as well as a close cooperation with investigative authorities, including Customs, Securities and Exchange Surveillance Commission and foreign FIUs.
Section1

## Need for International Cooperation on AML/CFT Measures

Economy and financial services are widely globalized today, and money transfers can be made instantly across borders. There are a number of cases in which crime and terrorist organizations attempt to evade judicial authorities' investigations by transferring criminal proceeds to foreign countries, and terrorist funds through third-party nations.

Non-cooperative countries and regions or those taking insufficient AML/CFT measures are likely to be misused as an escape route for money-laundering or terrorist financing.

It is in this context that no jurisdiction can be outside the global network to tackle money laundering and terrorist financing. Every country or region needs to closely cooperate with others in making and implementing measures against this, so relevant authorities can trace and detect illicit proceeds and prevent criminal organizations from abusing international financial system for illicit purposes.

Since the time of Japan Financial Intelligence Office (JAFIO), Japan's FIU has actively participated in the deliberation at FATF (Financial Action Task Force on Money Laundering) and other international institutions and discussed this matter with global partners.

JAFIC (Japan Financial Intelligence Center), Japan's new FIU established in April 2007, will not only take over the achievements of JAFIO, but will also seek to collaborate even more vigorously with other countries in promoting global implementations of effective AML/CFT measures.
## Section2

# Activities of International Institutions and Japan's Participation

## Paragraph1 FATF

## 1 | FATF

FATF (Financial Action Task Force on Money Laundering) is an intergovernmental body established by the "Economic Declaration" of the 1989 Arche Summit Communiqué to promote international cooperation on AML measures. After the September 11th terrorist attacks of 2001, FATF has also taken an initiative in the promotion of international CFT measures.

FATF has 32 member jurisdictions (including Japan) and two international organizations as of October 2007.

## 2 Activities of FATF

(1) Main Activities of FATF

1. Formulation and review of international standards in the "FATF Recommendations" concerning AML/CFT measures

2. Monitoring the status of compliance with the FATF Recommendations in FATF member jurisdictions (Mutual Evaluations)

3. Promotion of compliance with the FATF Recommendations to non-member nations/regions

4. Study on trends and modus operandi of money laundering and terrorist financing

## (2) The FATF Recommendations

a ) The 40 Recommendations

In 1990, FATF laid out standards in "the 40 Recommendations", to be applied by a jurisdiction in the field of law enforcement, criminal justice, and financial regulations.

In 1996, FATF revised the Recommendations and, for instance, made suspicious transaction report obligatory and required predicate offences to include serious crimes as a whole. With cooperation from private sector, FATF started a re-evaluation process of the Recommendations in 2001 to improve AML/CFT measures against the increasing sophistication and complexity of money laundering. The re-revision was finalized and publicized in June 2003.

The new "40 Recommendations" contained following additional elements.

○ Clearer definition of money-laundering offenses

☐ Risk sensitive customer due diligence

○ Countermeasures against the use of corporate body forms

○ Application of preventive measures to non-financial businesses (real estate agents, dealers in precious stones and metals, etc.) and professions (lawyers, accountants and other professionals)

○ National and international cooperation among FIUs, supervisory authorities, law enforcement authorities and other governmental organizations handling issues related to money-laundering
b) The 9 Special Recommendations on Terrorist Financing

In October 2001, a month after the September 11th US terrorist attacks, FATF held an extraordinary plenary session to discuss countermeasures against terrorism. The agreement of the session was reflected on "8 Special Recommendations" and made public. Since FATF added a new recommendation on "cash couriers" to this in October 2004, it is now called "9 Special Recommendations on Terrorist Financing."

Main components of the 9 Special Recommendations are as follows:

☐ Criminalization of terrorist financing

○ Requiring suspicious transaction reporting related to terrorist financing

○ Requiring financial institutions to store and make available to authorities accurate and meaningful originator information (name, address and account number) of wire transfers

## (3) Mutual Evaluations

FATF employs a peer review approach to encourage its members to implement recommendations. Countries are evaluated by other members on how compliant and effective their AML/CFT system and its enforcement are.

Mutual evaluation on Japan was conducted twice in the past, in 1994 and 1998. The third round started in March 2008, based on the 40 Recommendations as re-revised in June 2003 and the 9 Special Recommendations.

Unlike the past two mutual evaluations, the results of the third mutual evaluation will be published and posted at the FATF website.

## 3 | Participation of JAFIC in FATF

As one of the founding members of FATF, Japan has been a very active contributor to its work. Japan chaired the plenary between July 1998 and June 1999 and its delegations have participated in tri-annual plenary meetings and working groups on money laundering typologies.

In 2007, JAFIC sent Councilor for Prevention of Money Laundering of NPA and several staff members to the plenary meetings of June and October, both held in France. They participated in the discussion for new AML/CFT measures and the debates on the third round mutual evaluations on the UK, Greece, Finland and others.

In view of participating in mutual evaluation assessment team, JAFIC sent one of its staff members in November 2007 to the Training Workshop for Mutual Evaluations Assessors held in Berlin.

FATF Meeting (France)

COPYRIGHT/COUNCIL OF EUROPE/OECD

## Paragraph2 APG

1 | APG

APG (Asia/Pacific Group on Money Laundering) is an international cooperative body estab-
lished in February 1997 at the FATF 4th Asia/Pacific Money-Laundering Symposium held in Thailand to promote anti-money laundering measures in non-FATF member jurisdictions in the Asia/Pacific region.

As of October 2007, the APG consists of 36 jurisdictions, including Japan.

## 2 Activities of APG

The main activities of APG are as follows.

1. Promotion of compliance with FATF Recommendations in the Asia/Pacific region

2. Promotion of legislation on AML/CFT in the APG member jurisdictions

3. Mutual evaluations on APG member jurisdictions

4. Information exchange and analysis on the trend of money-laundering in the Asia/Pacific region

## 3 | Participation of JAFIC in APG

Japan is one of the founding members of APG and has been actively contributing to APG, much

APG Annual Meeting (Australia)

like it has to FATF. For example, the first and second typologies meetings in March 1998 and March 1999 were held in Tokyo, and Japan took the role of co-chair with Australia between July 2004 and June 2006.

JAFIC sent its staff members and Councilor for Prevention of Money Laundering of NPA to the annual meeting held in Australia in July 2007. The delegates participated in the debates on the mutual evaluations on Malaysia, Mongolia, Macao and other jurisdictions. Some staff members were also sent to the typologies meeting held in Thailand in November 2007 to participate.

pate in the study on the best practice of information analysis at FIUs and on the newest modus operandi and trend of money laundering.

JAFIC plans to send personnel as assessment team members for APG mutual evaluations in the future in order to contribute more enthusiastically to the activities of APG, and sent personnel to Training Workshop for Mutual Evaluations Assessors held in Singapore in July.

## Paragraph3 Egmont Group

## 1 | Egmont Group

The Egmont Group is an international forum established mainly by FIUs of several European nations and the United States in April 1995 with the goal of promoting cooperation, such as information exchange and training, between FIUs around the world engaging in AML measures. The group is named after the Egmont castle where the first plenary session was held.

Although the Egmont Group was established as an informal forum at beginning, it has become an internationally-recognized official body at present, through the adoption of the Egmont Group Charter at the May 2007 annual plenary in Bermuda and the establishment of its permanent Secretariat in Toronto, Canada.

The Egmont Group, consisting of FIUs of 105 countries/regions as of October 2007, organizes
annual plenary meetings and tri-annual working group meetings.

## 2 | The Main Plenaries of the Egmont Group

In addition to the annual plenaries, the Egmont Group has the following working groups, which hold meetings about three times a year respectively.

1. The Legal Working Group (LWG) which reviews the candidacy of potential members and handles all legal aspects and matters of principle within Egmont Group, including cooperation between FIUs

2. The Training Working Group (TWG) which identifies training needs and opportunities for FIU personnel, and conducts training seminars for Egmont members as well as for non-

3. The Outreach Working Group (OWG) which works to create a global network of FIUs by identifying candidates for membership and working with those countries to ensure that they meet international standards

4. The Operational Working Group (OpWG) which seeks to bring FIUs together on typologies development and long-term strategic analytical projects

5. The IT Working Group (ITWG) which provides advice and technical assistance to new and exist-

Egmont Group Annual Meeting

(Bermuda)

ing FIUs to develop, enhance, or redesign their IT systems, and examine new software applications that might facilitate analytical work

## 3 | Participation of JAFIC in the Egmont Group

Upon establishing JAFIO within the Financial Services Agency as a Japanese version of FIU, Japan applied for membership in the Egmont Group, and was granted it in May 2000 at the 8th annual plenary held in Panama.

JAFIO actively participated in the activities of the Egmont Group. It sent personnel to working group meetings, as well as to the annual plenaries, and took part in the drawing-up processes of the Egmont Group Charter. JAFIC also undertook the role of sponsor FIU (in co-sponsorship with the Thailand FIU) in the application procedures for Myanmar FIU, which is currently not yet an Egmont Group member.

JAFIC took over the function of Japan's FIU from JAFIO by the partial enactment of the Act on Prevention of the Transfer of Criminal Proceeds in April 2007, and was granted the Egmont Group membership as the new Japan's FIU at the 15th Annual Plenary Meeting held in Bermuda in May 2007.

During the first year as an Egmont member, JAFIC sent personnel to the working group meetings held in October in Ukraine, as well as working group meetings held with the above-mentioned annual plenary meeting. They also participated in the discussion of the adoption of the Egmont Group Charter, the assessment of membership for applying FIUs, the revisions of the principles related to the exchange of information between FIUs, etc.
## Section3 Information Exchange with Foreign FIUs

## Paragraph 1 Establishment of the Framework for Exchange of Information

Tracing criminal proceeds or terrorist financing across borders will not be successful without timely information exchange with FIUs of other countries.

According to the 2nd paragraph of Article 12 of the Act on Prevention of the Transfer of Criminal Proceeds, JAFIC may disseminate STRs to foreign FIUs on condition that there is a framework governing how the foreign FIUs should use the disseminated information. JAFIC has been promoting the negotiations for setting the framework for information exchange with numer-

MOU agreement with United States FIU

ous foreign FIUs since its establishment of April 2007 in order to constructively exchange nec-

MOU agreement with Belgian FIU

of April 2007 in order to construct an exchange necessary information with them. JAFIC has agreed on such a framework, or an MOU (Memorandum of Understanding), with FIUs of 12 countries and regions with close geographical and economical relations (Hong Kong, Thailand, Malaysia, Belgium, Australia, the US, Singapore, Canada, Indonesia, the UK, Brazil and the Philippines) by the end of 2007.
## Paragraph2 Status of Information Exchange with Foreign FIUs

Table 5-1 Exchange of STRs with Foreign FIUs

Number of requests for information from foreign countries	33
Number of suspicious transaction reports provided	3
Number of reports provided, not related to suspicious transactions	7
Number of reports not provided( $ ^{※} $ )	23
Number of reports provided from foreign FIUs	26
Number of reports provided, based on requests of information of JAFIC	16
Voluntary provision of information from foreign FIUs	10

Cases in which JAFIC did not possess related information, and cases in which providing information was not possible because an MOU was not entered.

In 2007, JAFIC expanded its international affairs section, which handles exchange of information with foreign FIUs, for active and quick exchange.

The status of the information exchange with foreign FIUs from the establishment of JAFIC to the end of 2007 is shown in Table 5-1.

The number of cases where requests for information to foreign FIUs are necessary has been increasing in particular, accompanying with the improvement of the STR analysis as stated in Chapter 3. In 2007, JAFIC requested foreign FIUs for information of the flow of suspicious funds remitted out of Japan, the source of

suspicious remittance from abroad etc., for further analysis. JAFIC always successfully and rapidly obtained needed information that had been requested as well as such useful information as foreign entities' involvement etc. from the requested FIUs.

Besides engaging in the activities of international institutions including FATF as stated in Section 2, JAFIC actively collaborated with FIUs and investigative authorities of other countries and participated in various training sessions organized by such institutions, as follows, with the aim of acquiring information analysis and application techniques and constructing close relationships with them.

May Participation in the FBI and the National Police Agency joint workshop (in the US)

June Participation in the training session hosted by the Australian FIU etc. (in the Philippines)

June Information exchange with the Philippines FIU (AMLC) (in the Philippines)

July Participation in workshops hosted by APEC and the Australia FIU (AUSTRAC) (in Australia)

August Information exchange with the Thailand FIU (AMLO) (at National Police Agency)

September Information exchange with the US FIU (FinCEN) and FBI (in the US)

October Information exchange with the UK FIU (SOCA) (in the UK)

November Information exchange with the UAE FIU (at National Police Agency)

Information exchange with Thailand FIU

Information exchange with the United Arab Emirates FIU