Úno 28

Japan Police: 98.3% of Money Laundering Cases Don’t Involve Cryptocurrency

Japan’s National Police Agency (NPA) say cases of suspected money laundering reportedly linked to cryptocurrency increased by 900 percent in 2018 when compared to the previous year. However, this still comprises only 1.7 percent of all money laundering investigations.


Cryptocurrency Money Laundering Up Tenfold in Japan

According to The Japan Times, the NPA reports that it recorded 7,096 cases of suspected cryptocurrency money laundering. This figure represents a tenfold increase from the 669 cases reported between April and December 2017.

Back in early December 2018, the NPA released a report stating that alleged cases of cryptocurrency money laundering for the year stood at almost 6,000. At the time, the period accounted for was between January 2018 and October 2018.

Since Q2 2017, regulators have required cryptocurrency exchanges in Japan to report instances of suspected illegal virtual currency transactions. This move was part of a whole host of reforms targeted at combating illicit activities carried out via digital currencies.

The NPA says many of the suspicious transactions involved multiple accounts with different bio-data information but using the same photo ID. Other cases involved accounts using foreign IPs even though details of the accounts show listing addresses based in Japan.

According to the NPA’s figures, the increase in crypto-related money laundering is indicative of a general rise in illegal financial transactions across the board in 2018. The NPA says it recorded more than 417,000 cases of alleged money laundering, an increase of over 17,000 from 2017.

Also, the percentage of crypto-related money laundering in the general reckoning has also increased. In 2018, 1.70 percent of money laundering was from cryptocurrency transactions compared to 0.16 percent in 2017.

Robust KYC/AML/CFT Rules to the Rescue

In August 2018, reports emerged that the NPA was set to commit more than $300,000 to develop a tracking software for cryptocurrency transaction. The NPA plans to implement this tool as a way of combating the rise of cryptocurrency theft and other illegal transactions.

FSA Japan

As reported by Bitcoinist in January 2019, the Financial Action Task Force (FATF) regulations on cryptocurrency will come into effect by Q3 2019. These regulations which center around KYC/AML protocols will apply to the G20, of which Japan is a member.

Experts believe such international standards will hinder the ability for criminals to launder money via cryptocurrencies. Meanwhile, the country’s Financial Services Agency (FSA) continues to implement stricter regulatory standards for cryptocurrency exchanges based in Japan.

Do you think the introduction and enforcement of KYC/AML regulations will curb money laundering? Let us know your thoughts below!


Images courtesy of Shutterstock

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Úno 03

European Commission to Bring Bitcoin Exchanges Under AML Directive to Curb Terrorist Financing

Source: bitcoin

money laundering, euro

Bitcoin exchanges in Europe are soon to be regulated under the scope of Europe’s Anti-Money Laundering Directive. The European Commission issued a statement late Tuesday night detailing new efforts to control financial flows and money transfers, which it described as aimed at subverting terrorist financing. Among these mechanisms are bitcoin and other virtual currencies. The Commission “proposes to bring virtual currency exchange platforms under the scope of the Anti-Money Laundering Directive, so that these platforms have to apply customer due diligence controls when exchanging virtual for real currencies, ending the anonymity associated with such exchanges.” The Commission’s renewed interest in financial controls comes on the heels of recent violence in Europe and beyond. Most European Bitcoin exchanges already perform extensive AML/KYC that has even alienated some of the more hardcore Bitcoin users.

Also read: G7 Leaders Looking to Regulate Digital Currencies

European Commission upping ante against alleged terrorist financing 2.0

The Commission’s First Vice-President, Frans Timmermans, described reducing terrorist funding as an effective ways to cut off terrorist efforts. Mr. Timmermans said:

“We have to cut off the resources that terrorists use to carry out their heinous crimes. By detecting and disrupting the financing of terrorist networks, we can reduce their ability to travel, to buy weapons and explosives, to plot attacks and to spread hate and fear online. In the coming months the Commission will update and develop rules and tools through well designed measures to tackle emerging threats and help national authorities to step up the fight against terrorist financing, and cooperate better, in full respect of fundamental rights. It’s crucial that we work together to deliver results and protect European Citizen’s security.”

Mr. Timmermans makes valid points about the need to stop terrorist financing immediately, regardless of its source. But is the Commission’s concern in bitcoin (“virtual currencies”) well-founded? According to Marco Santori, speaking at The North American Bitcoin Conference in Miami last month, a recent Financial Action Task Force (FATF) report ranked Bitcoin low on the list of primary financial instruments which break anti-money laundering laws.

Senate hearings in November 2013, and regulations like the NY BitLicense, demonstrate that American regulators are already aware of growing technological innovation in virtual currencies. FinCEN has enacted similar AML/KYC requirements of American Bitcoin exchanges. European regulators may have looked towards America for precedent and procedural advice in tackling a growing and complicated set of technical and legal challenges. Given recent advancements in Bitcoin mixing and anonymization, Bitcoin will need to be better understood by those in both countries’ political and legal communities to answer these difficult questions. Governments leaning on Bitcoin exchanges, the fiat gateways, is really all they can do.

What do you think about the European Commission’s move to curb Bitcoin use by terrorists? Comment below!

Featured image from taxrebate.org.uk.

The post European Commission to Bring Bitcoin Exchanges Under AML Directive to Curb Terrorist Financing appeared first on Bitcoinist.net.

European Commission to Bring Bitcoin Exchanges Under AML Directive to Curb Terrorist Financing

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