How counterfeit money is made and how it circulates
As soon as there were coins, there were people making counterfeits. In attempts to foil counterfeiters, issuing authorities have continually added design elements to money to make counterfeiting more difficult. Today US currency is made with many important security features, which allow the user to check the authenticity of a note. Watermarks, security threads, color-shifting ink, special paper, signatures, the US Seal, and unique numbering all help to determine the authenticity of a note.
Despite all efforts to prevent counterfeiting, counterfeiters in the US and abroad produce currency and put it into circulation. Traditionally, counterfeits are made by offset printing. Counterfeiters need to acquire heavy machinery in order to undertake offset printing; the right kind of ink is also needed as well as expert production of printing plates. Procuring the right paper is another challenge. This is often achieved by bleaching genuine $1 notes. Such counterfeiting requires serious financial investment to purchase equipment and supplies.
For the last decade, counterfeiting has moved increasingly towards using digital scanners, computers and inkjet printers, which are available with little expense or effort. At a quick glance such notes appear highly convincing and can pass without detection. However, inkjet printing, which mixes four base colors, is a fundamentally different process from the printing method by which genuine notes are produced, and such counterfeit notes can be detected when examined under a loupe.
Just as most US currency circulates abroad, so most counterfeit currency is also produced abroad. South America, parts of Southern and Eastern Europe and the Far East are regions with active counterfeiting rings, which the Secret Service works constantly to break up. Often counterfeit notes are detected when they enter the country via the US mail or other carriers. Large amounts of counterfeits are also smuggled into the country by visitors.
Colombia, with its drug cartels, is considered one of the world’s centers of the production of counterfeit dollars. Often hidden in the mountains, the production facilities are hard to detect. Despite the dingy underground locations, the workmanship of the bills is good. On the black market such bills sell cheaply as part of the drug trade and other organized crime.
The Secret Service recently broke up a major operation in Colombia, in which the process of bleaching and reprinting notes can be seen in detail. By bleaching a note with an abrasive cleaning material, the ink printed into the cotton-based paper will disappear. As a result the paper will feel thinner, the watermark will disappear and the security thread will be lost as well. Counterfeiters print a new yellowish watermark on a note and add it to a second bleached note, which has a fake thread glued into it. The two notes are then glued together and give the appearance of a genuine $100 note.
$1 Bleached on both sides (Courtesy of the US Secret Service)
One can still see the outlines of the original printing. The note also feels thinner than the original.
Bleached note with fake watermark of Benjamin Franklin (Courtesy of the US Secret Service)
Bleached note with fake glued security strip (Courtesy of the US Secret Service)
Bleached note with counterfeit $100 print (Courtesy of the US Secret Service)
Two bleached notes glued together, printed with the counterfeit $100 designs (Courtesy of the US Secret Service)
Photo of a seized bleaching machine (Courtesy of the US Secret Service)
The machine has a roll wrapped with steel wool, through which genuine notes are moved.
Photo of graffiti remover which is used for the bleaching process (Courtesy of the US Secret Service)
This good quality counterfeit note was printed with plates on an offset machine and comes from a similar case in South America.
Counterfeiting with Modern Technology: Scanner and Inkjet Printer
In 2004, Albert Talton was released from prison where he had served five years for bank fraud. After having been shown a fake $50 note, he decided to set up his own operation for making the best possible counterfeits. The notes he used were from plate 38, spot H, and his case became known as H2-H38. Within a short time, he was able to produce highly convincing notes, with a computer, scanner, inkjet printer and supplies from Staples. Three friends were hired and he began a production line of counterfeit money in a suburban house, which would ultimately produce notes in excess of $7 million. Several luxury cars, including an Aston Martin and two Mercedes, were parked in front of his house in Lawndale, CA. After three years of making and selling counterfeit money, the Secret Service, with the help of informants, tracked down the source and arrested all four criminals. Talton is now serving nine years and two months in Federal prison.
More about Albert Talton’s case:
Counterfeit $100 note from H2-H38 case (Courtesy of the US Secret Service)
On closer inspection one can see the cyan ink in the seal. The irregularity of straight lines and other details is apparent in the border around the bill. The magenta ink is also visible in the vignette of Independence Hall (see enlargements).
How Counterfeit Money Moves
Counterfeit money is often on the move, at times in large quantities. Often notes are bundled up and put into toys or books and thus disguised as regular merchandise. In a case from Italy, counterfeit money was put into milk crates. The photos from such seizures illustrate some of the types of packaging.
This map illustrates how counterfeit money from Colombia moves to various countries. The routes coincide with other illegal operations such as drug trafficking or arms smuggling, primarily in countries where the US dollar dominates the economy. In Colombia, the various drug cartels produce counterfeit money that has surfaced in Mexico, the US, and parts of Europe. Peru, Bolivia, and other South American countries have serious counterfeiting problems involving both the local currency and coins. (Courtesy of the US Secret Service)