Japan plans to adopt stricter anti-money laundering measures, including the controversial “travel rule” introduced by the Financial Action Task Force (FATF), starting from June 1. This move comes after FATF, a global financial crimes watchdog, called upon G-7 economies, including Japan, to take the lead in implementing the “travel rule” for cryptocurrency transfers.
Japan Crypto Anti-Money Laundering Laws Will Be Tougher
According to Kyodo News, Japan is scheduled to enforce more stringent anti-money laundering measures, including the “travel rule” established by the Financial Action Task Force (FATF), starting from June 1.
The decision was made by Japan’s cabinet after FATF, the global financial crimes watchdog, criticized the nation’s inadequate anti-money laundering efforts. In 2019, FATF recommended the travel rule as a means to combat money laundering and terrorist financing involving cryptocurrencies.
By June 2022, FATF began urging member countries to swiftly introduce legislation for the travel rule. Earlier this month, the G-7 intergovernmental political forum expressed support for FATF’s initiatives to accelerate the worldwide implementation of the travel rule, which mandates the exchange of information regarding cryptocurrency fund transfers among financial institutions.
At that time, Japan had not yet implemented the travel rule. Japan’s decision to enforce this rule is viewed as an effort to align with global standards endorsed by the G-7, of which Japan currently holds the presidency.
Japan’s crypto industry has been grappling with the travel rule since 2021, when the country’s Financial Services Agency (FSA) requested virtual asset service providers to implement it.
In April 2022, the Japan Virtual Currency Exchange Association (JVCEA) introduced self-regulatory guidelines accordingly.
In October of the previous year, the Japanese government approved a cabinet decision to amend existing laws, in accordance with FATF guidelines, to curb money laundering involving cryptocurrencies.
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