Watchdog Urges Japan to Step Up Anti-Money Laundering Measures
(Bloomberg) -- Japan needs to do more to tackle money laundering and terrorist financing even though the country has shown a good understanding of the associated risks, according to the global money laundering and terrorist financing watchdog Financial Action Task Force.
Following on-site assessments conducted in late 2019, Japan remained in the “enhanced follow-up” category overall, alongside countries such as the U.S., Australia and Canada, said the FATF’s first mutual evaluation report on Japan since 2008 released on Monday. These nations need to fix shortfalls raised in peer reviews and report progress, according to the FATF.
Of 113 countries and territories assessed in the latest round, 21 were placed in the regular follow-up category, 36 in the enhanced follow-up category. Of 56 other countries and territories under observation, 22 were placed on a gray list.
Japan’s Finance Ministry said the majority of components that could be compared to the country’s last evaluation have improved as it announced a three-year plan to keep improving measures to combat money laundering and terror financing.
“Crimes including money laundering have become more complicated and globalized in recent years, and Japan’s measures need constant updating,” Finance Minister Taro Aso said in a statement after the report’s release. “This is particularly necessary in order to make Japan the open, international financial center that is part of its growth strategy goals.”
In the report, Japan was seen needing to prioritize efforts in areas including supervising financial institutions, preventing the misuse of legal professionals, and investigating and prosecuting money laundering and terrorist financing.
Japan’s three-year plan to tackle the issues include strengthening the monitoring of financial institutions and improving its ability to track the risk that non-profit organizations are used for terrorist financing. Aso said the nation will also enhance its capacity to freeze assets, when needed.
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