5,944 Reports of Suspicious Cryptocurrency Transactions Filed in Japan from January to October 2018


The National Policy Agency (NPA) announced on December 6 that cryptocurrency exchanges in Japan reported 5,944 cases of cryptocurrency transactions suspected of being used for money laundering and other illicit activities from January to October 2018.

Reports to the NPA regarding suspicious transactions were made mandatory for cryptocurrency exchange operators in April 2017, with 669 reports filed that year starting from April. The NPA sees the sharp increase in report submissions as the regulation taking full effect.

The 669 cases reported in 2017 were referenced in the “Report on the National Risk Assessment of Money Laundering and Terrorist Financing” released on December 6 by Japan’s National Public Safety Commission, which compiles information on money laundering and other illicit activities in the country.

According to the National Public Safety Commission’s report, reasons for submitting reports for suspicious transactions included “multiple applications for authorization with different names and birth dates while attaching a photo with the same person’s face, opening multiple bank accounts and user registrations with the same IP address, and users claiming residency in Japan but primarily logging into their accounts from outside Japan.”

The report lists examples of misuse of cryptocurrency for money laundering including obtaining an account with someone else’s name without authorization, using credit card information to purchase cryptocurrency, and exchanging cryptocurrency into Japanese yen on an overseas exchange website and transferring it to another person’s account. There had also been instances of cryptocurrency used to purchase illegal substances or pay for special points required to download child pornography.

The National Public Safety Commission also noted in their risk assessment that cryptocurrency users have high anonymity, making it difficult to track money and whether it is being misused for a crime. The report indicated that “the Commission recognizes that the risk of misuse for money laundering is relatively higher (in cryptocurrency) than other lines of business.” *This article was written by Fisco