Japan Records 170 Money-Laundering Cases Related to Cryptocurrency over Six Months

Japan’s police oversight body stated on Thursday it had registered 170 suspected cases of money laundering where cryptocurrencies were used. The report covers the six months through October 1 and involves local currency exchange services.

In April, Japan updated its laws on preventing the transfer of criminal proceeds, and crypto exchanges now have to report suspected cases of money laundering. This will make it possible for the National Police Agency (NPA) to easily track the cases and deliver accurate reports.

Following the disclosures of the crypto exchanges, the police took over the suspect cases and redirected them to special investigative bodies.

Cryptocurrencies like Bitcoin or Ethereum permit a degree of anonymity so criminals can use them for transactions involving narcotics or child pornography, for instance.

We reported recently that Japan had issued licenses to 11 crypto exchanges, which made it one of the most cryptocurrency-friendly countries after China banned local crypto exchange operations and initial coin offerings (ICOs).

“We want to take countermeasures by collaborating with relevant ministries and agencies as well as business operators.”

Besides the reports from crypto exchanges, the NPA has reviewed data provided by lenders and insurers. For the three years through 2016, there were over 1.1 million suspected cases, of which 16.2% tied to members of organized crime groups. The agency tackled 1,077 cases, 21.4% of those clearly pointing to gangsters.

Japan’s concerns over cryptocurrency operations do not represent an isolated example. In Australia, the authorities have included Bitcoin and cryptocurrencies into their existing AML/CFT regulation.

Malaysian authorities expressed similar intentions at the end of September. Tai Sri Muhammad Ibrahim, governor of Malaysia's Bank Negara, said:

“We hope to come out with guidelines on cryptocurrencies before the end of the year: in particular, those relating to anti-money laundering and terrorist financing. We want to ensure that there are clear guidelines for those who want to participate in this sector.”

By the end of November, the bank was already working on a draft bill.