One of Japan’s biggest bitcoin exchange, with trading volumes of $65 million in the past 24 hours, has announced today they have received an “improvement order” by the Japanese FSA for inadequate AML/KYC requirements.
They say steps are now being taken to implement the improvement order according to an english version of the announcement.
They are now to review all current customers’ identification documents and may ask some of them to undergo through the identification process again.
In the meantime, all new account registrations are temporarily suspended until “the review of the status of identity confirmation to existing customers is completed and the internal control system is strengthened.”
The improvement order they have received by Japan’s Financial Services Authority (FSA) only applies to the Japanese branch and does not affect the EU or US Bitflyer branch. It says:
“Business Improvement Orders
(1) In order to operate a suitable and reliable business, take the measures listed below
1 Perform an intense review of the management system
2 Build out risk management system for anti-money laundering and
combating the financing of terrorism
3 Build out management system for rejecting antisocial forces, etc.
4 Build out management system for user assets and take a managerial approach to books and documents
5 Build out management system for user protection measures
6 Build out management system for system risks
7 Build out management system for user information safety
8 Build out management system for ensuring the appropriate interactions for complaints from or consultations with customers
9 Build out risk management system for the listing of new virtual currencies
10 Regarding improvements 1 through 9, a third party shall verify the improvements’ appropriateness and effectiveness
(2) A business improvement plan for the improvements ordered in (1) must be submitted in writing by July 23, 2018
(3) Until the time that the business improvement plan has been fully enacted, a monthly report must be submitted by the tenth of each month detailing the previous month’s progress and implementation status”
As can be seen, that’s some considerable requirements concerning not just identification but a range of matters.
Article updated to refer to the english version of the announcement which has now become available.