Tokyo, Aug 31 : The Financial Action Task Force (FATF), an intergovernmental body tasked with combating money laundering and terrorist funding, urged Japan to take stronger countermeasures , referring that some small financial institutions have a limited understanding of the risks. The FATF also on Monday called on the Japanese police and prosecutors to prioritise the investigation of serious money laundering cases and improve the rate of prosecution, prompting the Japanese government to prepare an action plan for the countermeasures upgrade, reports Xinhua news agency. The FATF, a Paris-based body, was established in 1989 to deal with rising concerns over money laundering, on the initiative of the G7 nations. According to the latest report releasing after an on-site review conducted in 2019 by FATF, Japan was placed in a second group requiring "enhanced follow-up". The FATF in the report recognized that Japan generally "has a good understanding of the main elements of money laundering and terrorism financing risks". However, it pointed out that some financial institutions other than megabanks, as well as supervisors and law enforcement agencies, have a low level of understanding of the risks. The report added that Japan's limited understanding of at-risk non-profit organisations (NPOs) has preventing authorities from adopting targeted methods to support their countermeasures, warning "this has placed Japanese NPOs at risk of being unwittingly involved" in terrorist funding activity. In response to the latest evaluation, Japan set up a council, which is jointly chaired by the Finance Ministry and the National Police Agency, to compile measures against money laundering and terrorism financing, and it has prepared a three-year action plan. The Ministry said that the plan includes tightening cooperation among regulatory authorities and updating the government's risk assessment on the transfer of criminal proceeds. Finance Minister Taro Aso said in a statement: "Crimes such as money laundering have been getting more complicated and globalised in recent years, so Japan is required to review its countermeasures constantly based on domestic and overseas trends. "This is also essential for us to become an international financial centre open to the world, as upheld in our growth strategy." The report for Japan was originally scheduled to release in August 2020, but due to the Covid-19 pandemic, it was postponed by a year. /IANS