Posts Tagged ‘counterfeiting’

Currency Counterfeiting and Defacing-Be Nice to Your money

Tuesday, March 10th, 2009

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Title 18, Section 471 of the United States Code states that manufacturing counterfeit United States currency or altering genuine currency to increase its value is a violation punishable by a fine of up to $5,000 or 15 years imprisonment or both. Also in Title 18, Section 333 of the United States Code, defacement, mutilating, cutting, disfiguring, perforating, uniting or cementing together any bank bill, draft, note or other evidence of debt issued by any national banking association, Federal Reserve Bank, or Federal Reserve System, with intent to render such items unfit to be reissued, shall be fined and/or imprisoned for up to six months.


You can just as easily be imprisoned and/or fined just for possession of counterfeit money with fraudulent intent. All of these offenses are covered under Title 18 of the United States Code. Possession of counterfeit money is under Section 472 and is punishable by a fine of up to $15,000 and/or 15 years imprisonment. These sections in Title 18 regarding counterfeiting are clear and strict however they only cover paper money. The defacement section covers all money. Defacement of currency in such a way that it’s made unfit for circulation is under the jurisdiction of the United States Secret Service.

Regarding the counterfeiting of change, also covered in Title 18, is outlined in Section 331of the United States Code. It seems that there isn’t a big problem of counterfeiting pennies because pennies are not mentioned whatsoever in this section. However, anyone manufacturing a counterfeit U.S. count in any denomination above 5 cents (which also sounds like nickels aren’t included, just amounts above them) is subject to the same penalties as all other counterfeiters, that is a fine of up to $5,000 and/or 15 years imprisonment. Someone who is only altering, not manufacturing, a U.S. coin to increase its value, also according to Section 331, is a crime punishable by a fine of up to $2,000 and or imprisonment of up to 5 years.

Section 510 covers the forging, altering or trafficking in United States government checks, bonds or other obligations. If you were to participate in doing these things, you could face a fine of up to $10,000 and or 10 years in prison. Section 474 covers and prohibits the printing reproductions, photographs of paper currency, checks, bonds, postage stamps, revenue stamps and securities of the United States. Violations are punishable by a fine of up to $5, 000 and/or 15 years in jail.

We all know, especially in these hard times that sometimes money is scarce. People are losing their jobs and paying more for their homes, food and basic necessities. The more people counterfeit, the lower the value of our dollar drops. If this is something you were to come across, think of the consequences outlined here and think if using counterfeit money is worth the $2,000 to $10,000 fine and years of jail time is worth it. Chances are that you would rather stay in the position you are in than every try to counterfeit money!

Currency Counterfeiting - A global nemesis

Sunday, March 8th, 2009

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The history of counterfeiting traces itself to the history of money itself. Counterfeiting had started when money was in its most primitive stages. The ancient Greeks and Romans resorted to shaving down legal coins, reducing their value, and use the shavings to cast new coins. The advent of paper money led to the modern day counterfeiting. With potential ill–effects being as huge as bringing a whole nation down, counterfeiting has proved to be a nemesis among nations, and the punishment for this crime can be as extreme as death.

Apart from being a human crime, counterfeiting by itself has been used among various nations to destabilise the economy of an entire nation. Governments have used it to a great degree of success by overflowing the target nation with fake bank notes, causing the real value of the currency to crash. During, the Revolutionary War, the Government of England resolved to counterfeit to reduce the value of the Continental Dollar. The United States government took a similar course but the fake Confederate currency they produced was of a superior quality as compared to the real thing.

The most professional campaign of counterfeiting was conducted by the Germans in World War II. The Germans manufactured very convincing paper, and used the professional expertise of prisoners held captive in Sachsenhausen concentration camp, to produce the fake currency. The Bank of England managed to obtain some bogus German currency, and found the forgeries so good that it is said that the only way to distinguish it from the real thing was that the forged one was better.

In the modern days, counterfeiting has been used to promote and sponsor terrorism. The Central Bureau of Intelligence (CBI) in India has reported that rupee notes are supplied by the Pakistan government press, free of cost to Dubai-based counterfeiters who, in turn smuggle it into India. This money is later used for funding terrorist activities inside India, and is also reported to be the main source of funding for the recent Mumbai blasts.

With advances in technology, the quality of counterfeiting has improved drastically, making it difficult to tell the real thing apart from its counterfeit. It is claimed that the U.S dollar bills produced in North Korea, are the finest counterfeit banknotes, and are called Superdollars because of their high amount of detail and quality. However, with the advent of the Euro, there has been a substantial decrease in the amount of forged U.S currency.

Counterfeiters use various measures to produce replicas of the original currency. Devices can range from a simple colour photocopier to much technologically advanced printing techniques like those used at the national mint depending on the level of accuracy and detail desired. Counterfeiting has become more of a bother now than ever before as it is easier for small-time operators to pull it off. All that is required is a high-resolution scanner, a high-end colour printer and a personal computer system.

Considering the nemesis that counterfeiting has on the economy, the governments of various nations have taken a number of steps to combat it. Techniques like making intricate designs, using ink patterns that are hard to duplicate have been employed. US greenbacks were traditionally printed in two inks. Many nations print engraved money, which use specially engraved plates that are very difficult to replicate. Some countries also resort to coming up with new designs frequently.

Statistics for counterfeiting remain uncertain, as it is difficult for most people to recognize a forged currency unless they are trained to do so. Some estimates place the proportion of bogus currency in Western Europe at about 3%, but the ratio is much higher in less developed countries. The usual target for counterfeiting is the $100 bill, and many of the forgeries are very good.

With so many techniques applied by various nations, the truth is that until money is being printed, counterfeiters will exist.

The Color of Money: Why is a Greenback Green?

Monday, February 9th, 2009

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greenbackIn 1929, when the United States Bureau of Engraving and Printing introduced the small-size note, that we currently use today, green pigment was readily available in large quantities.  The color was relatively resistant to physical and chemical changes, and the color was viewed to be psychologically identified with the security and strength of the United States Government.

More importantly, this newly developed ink had protective qualities that could not be easily “lifted” from the note itself, which had been a favorite technique of counterfeiters in the past.  Since the mid-1800’s, it had been customary to print bills in black, with different slight variants of color.  When photographed, the color variants would show only in black, since early cameras could only photograph in black.  Not to be outdone, the counterfeiter soon discovered that they could remove the colored elements from the Bill, photograph the remaining black ink elements, make copies, and then overprint an imitation of the colored parts on the newly made copies.

A new solution was needed, and was quickly developed. The development, as well as the patent purchase for this ink, was by Tracy R. Edson, who later Founded the American Banknote Company, one of the same firms that produced the first currency used by the United States.

The faces of these early notes that were produced under contract were printed with the newly patented green tinted protective ink.

When printing with oil-base type inks, like the new “patent green,” it is not unusual for the color to show through to the opposite side of the sheet.  Therefore, the backs of early notes were printed in a darker shade of green to make the “strike through” of the tint less obvious.

The transition to the Treasury Department’s Bureau of Engraving and Printing was gradual, so the backs of the notes produced there during the intervening period were continued to be printed in green for the sake of uniformity.

Once the Bureau was in full-scale production, there was no reason to change the traditional color, and it was only logical that the practice continue.

Thus, the “greenback” was born!

The Bureau currently uses a technique called “Intaglio Printing,” which involves a revolving plate, filled with the grooves containing the design and wording.  These grooves are filled with ink and then wiped clean on the surface.  The paper is forced with approximately 20 tons of pressure onto the plate, picking up the ink contained within the finely recessed lines and grooves, leaving the surface of the newly printed currency with a slightly “raised” feel, while the reverse has a slightly indented feel.

Thanks to new technology introduced in the last few years, the newly redesigned, recently introduced United States Currency features some new splashes of color on the various denominations, using an “Optically Variable Ink” (or OVI).  This ink allows a shift in color variation when held at different angles.

A copy machine, for example, scans a document at ONE FIXED ANGLE, relative to the bill’s angle when placed on the glass, thus not picking up the color shift.

This ink, produced by a Swiss company called SIPCA, is not readily available and thus aids in deferring counterfeiting.

So, the next time you reach in your wallet and pull out a Greenback, you’ll know why it’s green!

Dollar Bill versus Dollar Coin

Tuesday, December 16th, 2008

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dollar bill versus dollar coinThe United States Mint has made several attempts to introduce a coin which would replace the dollar bill. Each time, the end result has been mass production of coins which end up stored in vaults due to lack of demand. Many other countries, including Australia and our neighbor Canada, have replaced their “dollar bill” with a coin version. So why do Americans prefer the bill over the coin so much?

The U.S. Mint pumps out 3.4 billion fresh single dollar bills each year. The truth is, dollar bills wear out in about 18 months while the coins last approximately 30 years. While each coin is more expensive to produce than a bill, the difference in time spent in circulation would mean the overall cost of having a dollar coin instead of a bill over time would be much lower. With this huge of a difference, wouldn’t it be more economical as a nation to utilize the coins? In 2002, the Government Accountability Office stated that our nation could save $500 million a year in production costs if we switched to coins instead of bills. Given the fact that taxpayers could save several hundred million dollars per year just by implementing the dollar coin and phasing out the dollar bill, wouldn’t the appeal to everyone? So just exactly how much is it worth to be able to have a dollar bill instead of a dollar coin?

The many advantages of a dollar coin are not only from a tax savings perspective. Vending machines would be more accessible as individuals are more likely to put coins in a machine instead of dig out a dollar bill. Coins are better for the environment than bills. Less paper is used to print them, the last longer than bills, and less energy is spent producing them. Coins are also easier than bills to count than bills since they don’t stick together and they can be weighed, whereas the bill cannot. Coins are also healthier than bills. Since they aren’t fibrous like the bill, they don’t absorb as many germs or dirt. Coins are washable by simply running under soap and water, but bills are much more difficult to clean without risking damage to the bill.

Current complaints regarding the dollar coin are that it is too close in size to a quarter. People also do not like the added weight in their pockets compared to a dollar bill. Since paper money can be folded and shaped to fit nearly anywhere, it is easier to carry than the coin. Other disadvantages would include the upgrades required to implement the new coins.  Many cash registers and the aforementioned vending mentions would all require equipment upgrades in order to be able to accept the new dollar coin. Counterfeiting is much easier to regulate with bills than coins since new technology allows for special inks, watermarks, and paper. Coins are much easier to counterfeit, therefore, perhaps a savings in created in the form of economic stability.

All in all, there are both advantages and disadvantages to each form of money. However, given our nation’s current financial struggles, the American people may begin to push for every dollar savings they can which could result in a look at the bottom line. In addition, as the “Green Initiative” spreads, the idea of the coin may go further from an environmental perspective. Yet, the fact remains, many attempts have been made to implement a dollar coin into circulation without success. Americans are just hesitant to adopt this new standard and it could remain a difficult sell. Only time will tell what the future of our money looks like. 

The Confederate States of America Dollar

Saturday, October 11th, 2008

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confederate states of america dollarTwo months after the formation of the Confederacy, the Confederate States of America Dollar was born, adding color to the already illustrious history of the United States currency . First issued in 1861, on the eve of the Civil War, these dollar bills lasted throughout the infamous conflict and became worthless by the end of it.

The Confederate States of America Dollars came in denominations of $1/10, $½, $1, $2, $5, $10, $20, $50, $100, $500, and $1,000. Its type and designs came in 72 separate varieties and within almost 5 years of its lifespan, was produced in seven different phases of series, ranging from 1861 to 1865. The currency also had numerous issuers and redeemable obligations. Under the multiple acts of the Confederate Congress, it is said that the total amount of the currency produced throughout this period totaled close to $1.7 billion.

The Confederate States of America Dollars, or CSA notes, was initially well received as means of trade with great buying capabilities. This didn’t last long as the war progressed though, resulting in diminished confidence in the currency. The amount of paper currency production began to increase and its redemption dates extended, depreciating the currency even further, and ultimately increasing inflation. It was said that a bar of soap during the time cost as much as $50, while an ordinary suit would be priced at $2700! By the end of the war, and probably caused by the Confederacy failure to remain intact, the currency became obsolete and was no longer considered as fiat money.

Counterfeiting was a huge concern with the CSA notes as well, due to its immense numbers and assortments. This was also largely attributed to the fact that all of the confederate states and banks were given the liberty to print and issue their own notes as and when it pleases. Interestingly enough, many of these existing forgeries remains valuable to collectors today.

The mass counterfeit of the Confederate States of America Dollars is also said to be credited to the lack of skilled engravers and printers, as well as secure printing facilities. This resulted in a lot of extraneous designs, such as mythological gods and goddesses, with southern themes like the depictions of African-American slaves smiling or happily going about their work, naval ships, and historical figures. Later issues pictured prominent Southern politicians, military leaders, and citizens.

This lack in quality was also narrowed down to more ancient printing processes, as most modern printing equipments and skilled engravers were only found up North, forcing the Southern printers to use lithographic processed scenes and offset lifting of the printing plates, to produce these notes instead.

confederate states of americaThe signatures on this currency was also not printed-on but hand-signed by the Register and Treasurer themselves, and although this practice is considered as an anti-counterfeiting method, large numbers of clerks were hired to eventually sign on behalf of the Register and Treasurer, respectively.

Surprisingly, albeit the shortage in precious metal, the Confederate States of America did manage to mint its own coinage. In 1861, one cent coin pieces were struck using nickel, with the Liberty Head design on the obverse. The Confederacy also did strike half dollar coins at the New Orleans Mint, although this fact eluded authorities until 1879, and 504 pieces of these coins were said to be minted during this period in time.

Government Laws About Copying Dollars

Saturday, July 5th, 2008

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dollar bill lawIt is legal to make a simple photocopy of a dollar bill, right? Not necessarily. There are strict laws concerning the reproduction of United States paper currency. Dollars can be illustrated or copied only under certain circumstances and only in certain ways. Here are the guidelines for reproducing dollars.

It is legal to create color illustrations of dollars, but certain restrictions apply. The illustration of the dollar cannot be the same size as an actual dollar. It should be less than three-quarters or over 1 ½ times the actual size, even if it is a portion of the bill.

Illustrations must only be printed on one side. Any negatives, plates, optical files, or digital images used to base the illustration on must be deleted or destroyed when the illustration is complete.

The same rules apply for photographs and printed copies of dollars, and other foreign currency, checks, securities, bonds, and stamps.

Reproduced bills can be used for motion pictures and videos. Movies, television shows and commercial advertisements can use them. They need to be reproduced in black and white. Anything used to create them must be destroyed after the production of the needed mock bills is complete.

For projection purposes, like movies, slides, and microfilm, actual money can be used. No prints can be made based on these materials unless they are black and white, and meet the above mentioned size requirements.

Make sure that you follow the law if you plan to make copies of actual money. Failure to abide by the law in this regard could result in a fine, a prison sentence, or both. Be careful about printing scanned color copies of dollar bills. Counterfeiting is a serious offense, and it would be terrible if you were charged for it just because of an innocent copy.

It is interesting how particular the guidelines are about these things, isn’t it? I just thought I would share that with you.

Counterfeit Laws In The United States

Saturday, July 5th, 2008

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dollar bill counterfeitCounterfeiting money is a serious offense in the United States. Not only the individuals who produce the counterfeit bills can be punished according to the law, but those who are somehow involved in any part of creating it or circulating it.

According to the U.S. Government Printing Office (GPO), being involved in counterfeiting is considered a Class B Felony. The law is very detailed about what should not be done with regards to counterfeiting and forgery. Most people know that if someone is caught producing counterfeit bills is in big trouble, but there is a penalty for other incriminating evidence as well. Here is a basic list of things that you should not do, otherwise you can be fined or imprisoned.

You can be prosecuted if you:

  • Are in possession or control of plates, stones, or analog, digital or electronic images or tools used for the purpose of printing any financial obligation or security (bills, coins, money orders, etc …)
  • Make any plate, stone, or analog, digital or electronic image used for counterfeiting
  • Print, scan, record counterfeit money
  • Have possession or control of counterfeit money
  • Sell plates, stones, or analog, digital or electronic images or tools used for the purpose of counterfeiting
  • Sell counterfeit money
  • Possession, forgery of anything similar to materials used to create government securities or financial obligations

The law goes on to explain that individuals are not to change the designs or the printing process in any way unless authorized to do so. You are also not permitted to take any portion of the tools and materials that are used in the printing process, and certainly cannot create any replicas of these things, in whole or in part.

The sentencing for a Class B felony differs from state to state, but counterfeiting probably calls for at least some jail time, maybe 10 years or so, and a hefty fine of thousands of dollars. The best idea is to use real money, and don’t try to create any yourself!