Fed’s counterfeiting experts fight flow of fake money
Boston Fed uses everything from specialized machines to “an extra sense” to root out phony bills
Think you could tell the difference between a real U.S. note and a counterfeit one? Arian Panariti definitely can. In fact, using what he calls “an extra sense,” the operations supervisor in the Federal Reserve Bank of Boston’s Cash Services group says he can even do it blindfolded.
One of the Federal Reserve’s many responsibilities is to ensure the distribution and supply of high-quality currency, and it can’t be high-quality if it’s counterfeit. So the Cash Services group at the Boston Fed puts a major focus on finding and rooting out the bogus bills.
Cash Services estimates it comes across 20 to 25 counterfeit notes per day, ranging from the $1 to the $100 denominations, and the number spikes around the holiday seasons. They say criminals use countless methods to forge the bills: bleaching, printing, drawing, you name it, they’ve seen it all.
Experts are trained to spot the “supercounterfeits”
But not all counterfeit bills are created equal. The Boston Fed frequently sees what have been dubbed “supercounterfeits,” or fake bills that require a trained eye to spot. Those are notes that Cash Services staff like Panariti learn to spot by undergoing extensive training that involves no fewer than 17 online courses, hands-on work, and rigorous testing. The result? For Panariti, it’s an incredible eye or “sense” for identifying false money. He says this sense is primary touch-based, but for some folks it’s visual.
“The criminals have gotten good at creatively mimicking the U.S. note,” Panariti said. “And the U.S. dollar is the most popular note to counterfeit because it’s the most popular form of currency.”
In a recent instance, he said, counterfeiters bleached $1 and $5 notes and printed the fake money in $50 and $100 denominations right onto the genuine U.S. currency paper to make it look authentic.
The major counterfeiters are usually part of organized crime, drug cartels, or rogue governments, and they sell their counterfeit bills wholesale, for 50 cents on the dollar or sometimes even less, Panariti said. Once these bills are purchased, they are tried in the retail world, and if they succeed, they become a part of the currency circulation.
Watermarks, color-changing ink, mircroprinting used to foil criminals
There have been a few major security features added to U.S. currency as a way to combat counterfeiters, according to the U.S. Currency Education Program. For instance, a legitimate note should feel rough to the touch as a result of the composition of the paper and the intaglio printing process, in which the ink hardens below the paper’s surface. On any bills of $10 or higher, there should also be color-changing ink on the lower right corner that shifts from copper to green. On $5 denominations or higher, a faint watermark will appear when held to the light. Microprinting is also used – small printed words on the notes that may require a magnifying glass to see.
The Boston Fed processes an average of 5.2 million banknotes per day, and it doesn’t rely only on staff to identify counterfeits. It also uses banknote processing systems with sensors that look for the standard features of a note: type of paper, quality of ink, the color-shifting ink, and the general quality of the note. If any one of those features is missing, the bill is spit out and given to a cash processor for further examination.
The Secret Service takes over when fake bills are spotted
When phony bills are spotted, Cash Services sends them to the U.S. Secret Service for further investigation. Meanwhile, the financial institution that sent the notes to the Fed is charged the value of the bills, and business carries on.
Counterfeiting Federal Reserve notes is a federal crime that could land you a fine of $15,000 or 15 years imprisonment, or both, according to the U.S. Bureau of Engraving and Printing.
“We take counterfeiters very seriously, because they take their work very seriously. They never stop,” said Vice President Lisa Perlini, who leads the Cash Services department in Boston. “We have to constantly evolve to stay ahead of the latest counterfeiting techniques. It’s a big part of how we promote sound growth and financial stability here in New England, and really around the whole country.”
For tips on how to spot counterfeit money, check out the U.S. Currency Education Program.