Written by 7:28 am Cryptocurrency

Police seizing crypto assets over unpaid parking fines

Saitama prefectural police, catching up with investment trends, have started seizing cryptocurrency assets from motorists who refuse to pay fines for illegal parking.

At least three cases of cryptocurrency seizures have been carried out in the prefecture north of Tokyo.

The moves represent a shift from the traditional police practice of targeting the savings or vehicles of the nonpayers.

When police officers spot an illegally parked car, they issue a fine to the driver “for rule-breaking.”

If the fine is not paid, the vehicle’s owner will receive a notice ordering payment of a “fine for leaving a car illegally parked” under a system introduced in 2006.

Continued refusal to pay will result in police seizing the individual’s assets based on the Road Traffic Law or a local tax law.

In fiscal 2021, Saitama prefectural police seized assets in 477 cases over unpaid parking tickets. Savings or vehicles were collected in 99 percent of the cases.

By the end of March this year, Saitama police had 925 cases in which they could not confiscate the car owners’ assets. The unpaid fines in those cases totaled 13,053,000 yen ($95,115).

In August, Saitama police seized cryptocurrency worth 113,000 yen from a man in his 20s who had failed to pay fines for five illegal parking cases.

It was the third time prefectural police had seized car owners’ cryptocurrency assets.

In November, Saitama police for the first time confiscated investment fund assets worth 25,000 yen from a car owner in his 40s who didn’t pay a parking fine.

“Individuals’ assets are not limited to savings nowadays,” a Saitama prefectural police official said. “It wouldn’t be fair if we can’t collect fines just because the car owners don’t have cash. We will actively seize assets in cryptocurrency or investment funds from now on.”

The official said police “make inquiries to financial institutions or other entities” to gain information about the assets held by the nonpayers.

With interest rates remaining low, many people in Japan are shifting their assets from savings accounts to financial products, such as cryptocurrency or investment funds.

A government tax-exemption program called the Nippon Individual Savings Account also encourages small-sum, low-risk investments by individuals.

The National Police Agency does not keep records of such seizures for parking fines, but it said Hyogo prefectural police have seized cryptocurrency and investment fund assets, while Gifu prefectural police have also collected cryptocurrency assets.

According to the NPA, there were 10,032 cases of asset forfeiture across Japan over unpaid fines for illegal parking in 2021. Most of the seizures involved cash, savings or vehicles.

But in some cases, police seized car owners’ salaries, deposits from foreign exchange trading or subscription rights for landline telephone lines.

In 2019, “cryptocurrency” was added to the revised Financial Instruments and Exchange Law and the Payment Services Law, making it a financial product in the same category as foreign exchange trading.

“Public authorities are catching up with what’s happening in the real world,” Toki Kawase, a lawyer knowledgeable about cryptocurrency assets, said about the Saitama prefectural police.

However, he added: “It’s not difficult to evade asset seizures by moving those assets overseas on the internet. Therefore, it’s necessary to continue passing legislation that reflects technological advances.”

(This article was written by Shun Noguchi, Tomoki Morishita, and Senior Staff Writer Shimpachi Yoshida.)

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