Counterfeiting is almost as old as money itself, dating back to phony Lydian coins in the 7th century B.C. When the Chinese introduced paper money using the bark of mulberry trees in the 13th century, guards were posted around the forests and counterfeiters were executed.
Governments have engaged in counterfeiting, too. Nazi Germany forged U.S. dollars and British pounds in an attempt to destabilize those countries’ economies during WWII. There’s some evidence that terrorist groups are doing the same today. Major crime syndicates such as the Russian Mafia have also dabbled in counterfeiting.
Government Measures to Prevent Counterfeiting
Most governments go to great lengths to make it hard to counterfeit their currency because it’s…well, it’s money even if it’s just a piece of paper. But as sophisticated printing techniques have become more available to commercial printers (and crooks), extraordinary measures have had to be introduced to make faking it even harder. These include embedded strips, watermarks, color-shifting inks and extremely fine details in printing.
The U.S. Treasury began an aggressive effort to combat counterfeiting with a series of design changes starting with the $100 bill in 1996 and has incorporated numerous other high-tech features since. A major redesign of the $100 bill entered circulation in 2013.
The Introduction of Polymer Banknotes
A major step in banknote security was taken by the Reserve Bank of Australia when it introduced the first polymer notes in 1988. After some initial glitches were worked out, polymer banknotes have been adopted by dozens of countries, from Canada and Scotland to Brunei and the Maldives.
How to Identify Authentic U.S. Paper Currency
When it comes to identifying authentic U.S. currency, the Federal Reserve has published an interactive online training module as well as a downloadable PDF tutorial that goes into great detail about security features. It suggests three quick ways for a preliminary check: Feel, Tilt, and Check.
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Feel the paper
The bill should feel slightly rough due to the raised printing method used. It should be neither too stiff or soft, too thick or thin, nor too glossy or smooth.
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Tilt the note
Bills $10 and larger have ink that changes color when the note is tilted gradually back and forth. $100 bills also have a 3-D security ribbon and color-shifting Liberty Bell in the inkwell beginning on Series 2009A.
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Check the features
Denominations $5 and higher have a watermark matching the bill’s portrait that is visible when held up to a light. You should also see a security thread.
Ultraviolet (UV) Light Test, Micro Printing Features and Counterfeit Detection Pens
If you have the resources available, there are some other ways to check, as well. Under ultraviolet (UV) light, the security strips in the bills should glow a specific color for each denomination:
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$100: |
Pink |
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$50: |
Yellow |
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$20: |
Green |
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$10: |
Orange |
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$5: |
Blue |
When examined with a magnifying glass, the micro printing on bills $5 and larger should be clear and easy to read. The text and location of the micro printing varies with each denomination.
It’s also important to note that so-called “counterfeit detection pens” are not always accurate and can give false results.
Most of this information applies to newer issues of U.S. currency, but older series notes are still valid regardless of when they were issued. It’s just harder to detect some counterfeits without the modern security features.
What to do with a Counterfeit Bill
If you have a counterfeit bill, regardless of its age, you’re stuck. Counterfeits cannot be exchanged for legal bills, and knowingly passing them along is a federal crime. If you get stuck with one, report it to your local police immediately, and accept the fact that you’ve been had.
For information about counterfeit detection for other countries’ currency, consult that country’s government website.
Whether you’re handling paper money for payment or collecting it as a hobby, it’s important to recognize counterfeits. Doing the research and due diligence will help save you from becoming a victim of counterfeiting!