The law to prevent diversion of criminal proceeds went into full force March 1. Its primary purpose is to prevent money laundering. Last year the law covered mainly financial institutions. It now applies to real estate agents, precious metal dealers and jewelers as well as judicial scriveners, administrative scriveners, certified public accountants and licensed tax accountants.
The law was prompted by 2003 recommendations made by the Financial Action Task Force on Money Laundering, an intergovernmental body. It will affect economic activities of people and companies. Administrative authorities, especially police, should act cautiously in implementing the law.
Under the law, financial institutions, real estate agents, precious metal dealers and jewelers must confirm the identity of their customers and keep records on transactions for seven years if they are involved in the sale of jewels and precious metal for which ¥2 million or more is paid in cash, the issuing of credit cards or the transaction of land and residences. Suspicious transactions should be reported to the administrative authorities concerned.
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