Article

Why your ATMs may soon dispense less counterfeit

As the federal battle against counterfeit money wages anew, ATM owners will soon see newly-designed bills in their cash cassettes. By Ryan DuBosar, Contributing Editor

March 7, 2002

WASHINGTON -- Counterfeiting, a longtime genuine problem, may soon not infect ATM networks and financial institution teller drawers with as much impact. The U.S. Treasury recently unveiled its new anti-counterfeit technology in its continuing efforts to defeat the high technology that created hundreds of millions of dollars in fake bills around the world.

The Treasury will issue its redesigned $20 note on Sept. 24, following the previously-released higher denominations and featuring the same anti counterfeiting features. The first redesign in 70 years is meant to counter not only international thieves but small-scale counterfeiters taking advantage of digital copiers and producing photocopied notes, or "p-notes."

Counterfeiting reached endemic proportions recently when even kids could download an image of a federal reserve note and output the graphic file to a color copier. Modern P-note criminals don't need the expensive plates or molds traditionally associated with counterfeiters--desktop computer equipment offers the same capability without the cost or the need for secret printing presses.

Like the series 1996 $100 and $50 bills, the new $20 bill keeps the same size and architectured design. The Treasury added a watermark, enhanced security thread, fine-line printing patterns, color-shifting ink, and a larger, off-center portrait.

Because the $20 bill is widely used in daily commerce and most frequently dispensed by ATMs, broad nationwide recognition of the new note when it is introduced will be critical to a smooth transition, according to the Treasury.

A comprehensive public education campaign includes outreach to major retailers, financial institutions and business organizations, constituency groups, news media, schools, and the general public.

On Sept. 24, banks and other depository institutions will begin receiving the first shipments of new $20 bills from Federal Reserve banks. The new notes will be available as banks place their currency orders. Some customers may not see the new $20 bills for some time, since their depository institutions may already have a large supply of the older series notes.

Seizing success

The Secret Service and other government agencies seized $136 million of fake bills globally in fiscal 1997. That's only 0.01% of the $430 billion of genuine U.S. currency, but public affairs Secret Service Assistant Special Agent in Charge (ASAC) Jim Mackin said, "We are not happy about any amount of counterfeiting. It represents a loss not only to merchants but to the government."

The most common international counterfeit, the $100 bill comprised 63% of all bills seized overseas. The $20 bill is the most common domestic fake.

The U.S. Treasury hopes to duplicate the success it had with the $100 bill, which cut international counterfeiting to nearly a quarter of the level it had reached two years ago, Mr. Mackin said.

In fiscal 1995, $231 million in counterfeit bills were seized. With the introduction of the new $100 note in March of 1996, that figure fell to $111 million in seized currency.

In the last fiscal year, only $64 million in fakes appeared abroad.

"The numbers internationally have dropped drastically," Mr. Mackin said. "Not only are the new notes harder to counterfeit, but they make it much easier for a cash handler or the general public to authenticate the money they are given."

Domestically, where the fake $20 is the bigger problem, law enforcement seized $31.7 million passed into the public and confiscated $40.3 million before it reached circulation.

"After all the efforts of public education and authentication, we should see a decline in domestic counterfeiting," Mr. Mackin said. "Since ATMs deal in $20s, the introduction of the 1996 series $20 bill will encourage the public to authenticate the money they are given."

High-tech printing security

The government most recently redesigned currency in 1990, adding microprinting and a security thread to defeat the then-modern reprographic technologies.

Sophisticated copiers posed the most obvious threat, with high resolution and color capabilities improving dramatically each year. The Secret Service terms copiers, or any device used to counterfeit money, as a "plant."

More recently, computers and ink jet printers have posed another threat, Mr. Mackin said. The use of the office copier increased from 62 plants in 1995 to 87 last year, but ink-jet plants increased from 29 in 1995 to 321 last year.

And every criminal element has become involved, whether it be the Mafia or street gangs.

Against this evolving threat, the government brought together all the production and enforcement agencies involved in currency and tested 120 features suggested by the public or other agencies, or used in other currencies.

Public education

Treasury spokeswoman Becky Lowenthal said that the manufacturers of machines that process $20s--ATMs and other bank and vending equipment--have already started testing their equipment to adjust to the new bills. The Treasury held two open fairs to allow the device makers to ensure their equipment still works with the redesigned bill.

"There are a lot of machines where the $20 bill might be the highest denomination, and so they weren't affected by the introduction of the $100s and $50s," she said.

The Bureau of Engraving and Printing in July held its second fair in which machine manufacturers tested the new bills, she said. The Treasury also provided notes to some companies so that they could conduct in-house tests.

The Treasury offers educational kits to help teach industry and the public about the new security features. Mr. Mackin said this information will enable the general public to spot fakes in less than one second.

The bills have color shifting ink in one corner and an offset portrait to allow room for a watermark, for example.

Each bill also has an identifying thread in a different place, Ms. Lowenthal said. The thread prevents washing the paper and using it to print a higher denomination, and could be used by money-identifying machines.

To date, nearly 2 million pamphlets and thousands of training videos and CD ROMs have been ordered by companies and business organizations contacted directly by Treasury, and a series of seminars in 20 different cities held jointly by the Federal Reserve and U.S. Secret Service drew more than 1,000 representatives of businesses nationwide. Tapes and brochures can be ordered by companies via an order form or interactive fax line offered by the U.S. Treasury.

The form can be ordered via interactive fax by calling (202) 622-2040 and asking for document number 2463. Background materials on the new note are available through Treasury's interactive fax by calling (202) 622-2040 (request #1745 for a currency index). The form is on the Web at http://www.moneyfactory.com /business.


>Sources:

Becky Lowenthal of the U.S. Treasury can be reached at phone (202) 622-1997, fax (202) 622-5245.
Jim Mackin can be reached at the U.S. Secret Service, phone (202) 435-5708, fax (202) 435-9069.


Related story: How to spot a fake bill


Links to related Secret Service Web pages:

Counterfeiting history
Counterfeit coins
History of U.S. money
Details on the new design
Portrait trivia--who's on what bill?
Regular design changes
What happens when money wears out or is damaged
What to do if you receive a counterfeit bill