Numbers released by the Japanese National Police Agency (NPA) this week show a sharp uptick in the number of suspicious transaction reports from cryptocurrency exchanges in 2018. Police received 5,944 reports of suspicious transactions from January-October of this year, according to the data.
The number was 669 from April to December of 2017. New rules came into force last April that obligated exchanges in the country to report suspicious trades.
Reporting System Has Been Embraced
One NPA official said the suspicious trade reporting system “has been embraced by the industry through guidance from the Financial Services Agency.”
Police indicated suspicious activity noted in the received reports included the use of the same photo by different people trying to verify identity, the opening of multiple trading accounts from the same IP address, and the submission of out-of-use phone numbers for registration purchases.
Japanese daily newspaper The Mainichi reported law enforcement in the country have been using the reports in various crypto-related investigations.
In a recent report, the nation’s National Public Safety Commission wrote how crypto transactions are vulnerable to abuse since cryptocurrencies can be sent across borders quickly and in a relatively anonymous manner. The Commission also wrote it was hard for authorities to track criminal proceeds since crypto regulations are different across countries.
Continued Crackdowns On Crypto Evasion
The statistics about the suspicious transaction reports come about the same time Japan’s National Tax Agency announced new anti-money laundering regulations targeted towards crypto businesses.
CryptoGlobe reported that the stipulations give the Agency authority to ask for customer information from cryptocurrency gateway businesses for tax-related purposes. The NTA is reportedly rolling out a system to streamline the information gathering process that will be fully up and running by April 2020.
Just a few days earlier, reports came out the Japanese Financial Services Agency (FSA) would be rolling out new ICO regulatory frameworks due to a number of related scams. CryptoGlobe noted that the FSA will be submitting draft proposals in January’s parliamentary session in an effort to introduce new ICO regulations.