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Published on Nov 26, 2013 in Asia, China, Featured Articles, News, North America

Anti-Counterfeiting a Nation’s Currency

Counterfeiting has been a fact of life throughout history, recorded as far back as Roman emperor Domitian, in 81 AD. At that time Lydian coins, the currency of the day, were counterfeited by using copper cores covered in a silver coating. Counterfeiting has occurred almost continuously since that time.

Not only is counterfeiting used as a method of accumulating wealth, but it’s also used as a means of destabilizing a rival government’s economy. As examples, counterfeiting for the purpose of economic destabilization has been employed by the British during the Revolutionary War, by the Union against the Confederacy during the Civil War, and by the Nazis against the British and American currencies during World War II.

North Korea is currently thought to be one of the world’s largest counterfeiters of foreign currency, producing “supernotes” which can pass through many of the detection devices that are currently in use. North Korea’s Office 39 is credited with directing the production of counterfeit currencies, allowing North Korea to purchase weapons and other government mandated items on the world market. Office 39 is believed to generate between $500 million and $1 billion in hard currency per year for the cash-strapped North Koreans.

Governments have tried to stay ahead of increasingly sophisticated counterfeiters, and continually implement technologically advanced security measures into their currencies. These measures include:

Watermarks. First employed in the 13th century, watermarks create an image on the currency which is only visible in light. In the past, watermarks on US currency were only presidential portraits. However, watermarks now also display the denomination of the currency.

Holograms. These are three dimensional drawings or photographs. Holograms are common on credit and debit cards in the US, and have been incorporated into the currencies of a number of nations. However, the US doesn’t currently employ holographic protection to its currency.

Color shifting ink. With this security feature, ink changes color in relation to the angle it’s viewed. For example, from one angle a currency denomination or other feature may appear green, but viewed from another angle it would appear to be orange. This prevents the currency from being scanned. This is because a scanner is only capable of viewing documents from a single angle. Color shifting ink also prevents most reproductions by printing as it makes replication extremely difficult. In addition, some inks used by governments, including the US government, are magnetic. Vending machines, for example, use these magnetic inks to discern if a bill is counterfeit.

Paper. Normal paper is made from the cellulose found in trees, whereas money is usually made from cotton and linen fibers. This is known as rag paper. In addition, rag paper is thinner than normal paper because it’s squeezed with thousands of pounds of pressure during the printing process. The composition and thinness of rag paper gives money its special crispness. In addition, during the production process of the rag paper, colored fibers may be added. For US currency, red and blue fibers are mixed into the paper.

Anti-counterfeiting pens are sometimes used to spot counterfeited paper as running the pen across counterfeit currency will turn the paper black or brown. This is because the highlighter contains iodine, which changes in color when it comes into contract with cellulose.

Security thread. A thin ribbon of plastic or metal is woven or embedded into the currency so that it emerges alternatively from both the front and back of the bill. For US currency the security thread glows either bright blue, yellow, or green depending on the denomination of the bill. These threads can’t be reproduced by photocopiers.

Micro-printing. Placing images that are intricate in detail and hard to replicate will normally make this finely detailed artwork appear muddied on counterfeit currency. For example, on US currency, “The United States of America” is printed in miniature letters around the border of a portrait. To the naked eye the words would appear as a black line, and a photocopier would photocopy it as such, making it hard to replicate by photocopier.

The Bank of Uganda also employs a relatively unique anti-counterfeiting technique by using raised printing as a method of protecting its currency.

Borders. Foreign currency, many times, contains intricate crisscrossing lines which appear on its borders. These lines are clear and unbroken on legal tender, but are often smudged or broken on counterfeit currency.

In spite of these sophisticated security measures, counterfeiters are becoming more creative and are able to produce bogus currencies capable of passing visual inspection. Counterfeiters, for example, have been able to replicate color-changing ink by mixing glitter in a blender. They’ve also employed high-quality printers and scanners to copy hard-to-create micro-images. In addition, since watermarks for the US $100 and $5 bills are the same, counterfeiters commonly remove the watermark from one bill and affix it to the other.

The US Treasury, in an effort to detect counterfeit currency, scans bills on a regular basis. Last year the government scanned 24.5 billion bills, half of them $1 bills. These scanners have 30 types of sensors that look at a number of properties inherent in a currency. Although what these scanners are looking for is a closely guarded secret, it’s thought that they examine the magnetic properties of the ink, the margin size, out-of-register printing, and crispness of the pictures.

America, Kazakhstan, Mexico, Sweden, and Hong Kong have the most difficult currencies to fake.

 Alan Refkin

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