Defendants Fail to Reimburse ¥125 Billion; Cryptocurrency, Offshore Accounts Create Challenges for Authorities

The Yomiuri Shimbun

1:50 JST, January 7, 2025

Defendants in criminal cases such as drug trafficking and fraud had yet to pay a total of ¥125.1 billion in reimbursements at the end of fiscal 2023, information requested from the Supreme Public Prosecutors Office by The Yomiuri Shimbun has revealed.

The figure stood at ¥44.9 billion at the end of fiscal 2007.

As reimbursement, defendants are ordered to pay a “sum of equivalent value in lieu of confiscation” with regards to the crimes they committed. It is collected by prosecutors under the Code of Criminal Procedure and stored in the national treasury. In a case, this amount is imposed at the same time as prison sentences and other penalties.

In addition to defendants that have insufficient assets, money laundering by criminal organizations has become increasingly sophisticated, making it difficult for investigative authorities to track down the money.

According to the data disclosed by the Supreme Public Prosecutors Office, the value of unpaid reimbursements dated fiscal 2022 or earlier and those newly determined in fiscal 2023 totaled ¥132.6 billion. Of this amount, the prosecutors were only able to collect ¥6.165 billion, or around 4.6%, in fiscal 2023.

In cases where a year has passed without the defendant paying a single yen and the statute of limitations has expired under the Penal Code, prosecutors determine that it is “unable to be collected.”

The total amount that was unable to be collected amounted to ¥1.364 billion in fiscal 2023. Subtracting this amount gives the ¥125.1 billion total for uncollected reimbursements.

Under the Punishment of Organized Crimes and Control of Proceeds of Crime Law, prosecutors can seize criminal proceeds up to 30 days before indicting a defendant.

However, in many cases the defendant has already spent the money. There have also been many recent cases of criminal organizations hiding their proceeds through money laundering using offshore accounts and crypto assets.

The Osaka prefectural police uncovered a criminal group last year that was receiving about ¥10 billion per month in online casino bets and other funds.

However, since most of the money had been transferred to offshore accounts, they were unable to track it down because it was hard to cooperate with local investigative authorities.

In another case, money transferred by a victim of special fraud was exchanged to crypto assets, which are highly anonymized and whose transaction history is difficult to trace.

Reimbursements collected from a defendant are distributed to the victims in their case, as stipulated in the law on the issuance of remission payments in 2006.

However, only ¥1.29 billion in total was ordered to be paid to the victims in 23 cases nationwide in fiscal 2023. If collections are delayed, it will have a significant impact on victims’ recovery.