CRYPTO CRIME | Multiple Japanese Authorities Say Crypto Poses ‘High Risk’ for AML in Real Estate Transactions

Japan has told real estate firms and cryptocurrency businesses to tighten anti-money laundering (AML) checks on property transactions involving digital assets, citing growing risks that such deals could be used to move illicit funds.

In a joint notice,

• The Financial Services Agency,
• Ministry of Land, Infrastructure, Transport and Tourism,
• National Police Agency, and
• Ministry of Finance

called for stricter oversight of crypto-linked property deals, marking a coordinated push across regulators.

Authorities said cryptocurrencies pose a “high risk” in real estate transactions because they can be transferred quickly across borders and are harder to trace than traditional bank payments, making them attractive for money laundering.

Under the guidance, real estate agents must

• conduct identity checks on buyers and sellers,
• verify the source of funds and
• file suspicious transaction reports,

aligning their obligations with bank-level AML standards.

The agencies also warned that intermediaries converting crypto into yen on behalf of clients could be deemed to be operating unregistered exchanges under Japan’s Payment Services Act, exposing them to enforcement action.

Crypto exchanges were instructed to monitor large or unusual transfers linked to property sales and flag activity inconsistent with customers’ financial profiles.

The move comes as regulators globally step up scrutiny of digital assets, particularly in sectors such as real estate that have historically been vulnerable to money laundering due to the size and opacity of transactions.

Japan has also reiterated existing reporting requirements, including rules mandating disclosure of large cross-border crypto transfers, as part of a broader effort to align its financial system with international AML standards.

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