This is highly contentious and, historically, has been the pretext for much abuse, trauma, and overbearing control of the vulnerable. In some circles it was used as the basis for the confessional (although officially, that is no longer said.) So what is actually being said in James 5:16?
First, there is a difference in the underlying Greek of NA28/UBS4 vs TR of the KJV. The two versions can be translated as follows:
TR/KJV: Confess your faults [Greek: paraptomata] to one another and pray
for one another …
NA28/UBS5: Therefore, confess your sins [Greek hamartias] to one
another and pray for one another …
Thus, we are discussing two Greek textual variants: (a) the inclusion of "therefore" in NA28 and (b) "sin" rather than "fault" in NA28 compared to TR. The evidence for the NA28/UBS5 readings over the TR reading is so overwhelming that the variation is not even listed by UBS5. The data in NA28 suggests that the TR text arose about the 8th century or later.
Therefore, I will briefly discuss the text as found in NA28/UBS5. The inclusion of "οὖν" = "therefore" is important as it ties v16 to the previous discussion. The entire thrust of this passage in v14-17 is an encouragement by James that the Christian congregations share concerns for one another and support each other. This includes care for the sick and a readiness to confess sins that have occurred between members. There is no suggestion here that ALL sins be confessed to one another - only those where a person has wronged (sinned against) another person. In this case, the procedure outline in Matt 18:15-20 and Matt 18:21-35 should be followed.