Withdrawals Delayed – Bitflyer Scanning for Yakuza Customers

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Bitflyer has been delaying deposits and withdrawals of virtual currency in the midst of ongoing KYC verifications. The company received business improvement orders from the Japanese financial watchdog in June as a result of insufficient measures against money laundering. Bitflyer reportedly has delayed resuming business as it is thoroughly verifying its clients’ identities. Bitflyer also has stopped taking new customers last month, and this might go on for a while due to a lack of manpower, Nikkei reported.

Also read: Japan Penalizes Crypto Exchanges – Yakuza Involvement Confirmed

In virtual currency trading, deposits and withdrawals are said to be the main stage of money laundering. According to the Financial Services Agency, the company neglected to confirm the identities of their users, which lead to allowing the anti-social forces or members of the Japanese mafia to trade crypto. For this reason, the company is now reassessing the list of its customers, and all deposits and withdrawals are being currently scanned.

Japan’s Yakuza Are Laundering Crime Money via Crypto Exchanges

Withdrawals Delayed - Bitflyer Scanning for Yakuza Customers
30 billion yen was laundered through various overseas exchanges since 2016.

According to a customer, despite requesting withdrawal on June 25, he was not able to confirm the transaction by the morning of July 2.

Last May, the Mainichi newspaper revealed that some divisions of Japan’s organized crime syndicates, also commonly known as the yakuza, were using crypto exchanges to launder money. The Japanese mafia allegedly transferred more than $270 million of their funds overseas, according to the Mainichi.

“We strongly recommended [the six Japanese cryptocurrency exchanges] to remove all ties with anti-social forces,” the FSA told news.Bitcoin.com.

As the cryptocurrency industry is growing in Japan, the FSA pointed out the necessity for crypto exchanges together with the local authorities to create a increasingly secure environment with proper monitoring systems in place, including screening users’ ID.

Although Japan is historically known for its police force collaboration with the local mafia, also known as the yakuza, recent organized crime exclusionary laws that came into effect in 2011 criminalize individuals or companies who use them to facilitate their business affairs. The authorities send a warning just like the FSA did on June 22, but when persisting in doing business with the yakuza, one may have their name released to the public, be fined, or imprisoned.

What do you think would happen if Bitflyer failed to verify their customers’ mafia involvement? Let us know in the comments section below.


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