www.bankersonline.com Using Copies of Money for Training Answer by Richard Insley, Hussam Al-Abed and Andy Zavonia, BOL Guru Guru BIOS Question: We would like to make copies of the new $20.00 bill for training purposes. Where can I find the actual interpretation of specific requirements? Answer by Richard Insley: Reproduction of Currency Authority: 18 UNITED STATES CODE; 504: Treasury Directive Number 15-56 FR 48539 (September 15,1993) 411.1 Color illustrations authorized. (a) Notwithstanding any provision of chapter 25 of Title 18 of the U.S. Code, authority is hereby given for the printing, publishing or importation, or the making or importation of the necessary plates or items for such printing or publication, of color illustrations of U.S. currency provided that: 1. The illustration must be of a size less than three-fourths or more than one and one-half, in linear dimension, of each part of any matter so illustrated; 2. The illustration must be one sided; and 3. All negatives, plates, digitized storage medium, graphic files, magnetic medium, optical storage devices, and any other thing used in the making of the illustration that contain an image of the illustration or any part thereof shall be destroyed and or deleted or erased after their final use in accordance with this section. Answer by Hussam Al-Abed: An extra Tip for forgery Training: always stamp all Training materials (banknotes and copies of banknotes) with “For Training Purpose Only “ stamp Answer by Andy Zavonia: First, BOL is a vault of information for this topic, so you need not reinvent the wheel. Money Matters This has several useful links including pictures of the new bill. If you could use a monitor or projector, you could avoid printing restrictions Richard pointed out. First published on BankersOnline.com 12/1/03 Teller Training: Forgeries & Counterfeit Currency by Barbara Hurst BIO AND CONTACT INFO QUESTION: Do you have any suggestions regarding teller training on detecting forgeries and counterfeit currency? ANSWER: Having devoted half a life-time to teller training, I could give you a lot of suggestions! But the easiest answer addresses counterfeit currency. When we talked to the Secret Service about all the tools on the market to detect counterfeit currency, we mentioned the pens that change color (not good if the currency has been laundered with a bleach product while in Copyright, 2004, BankersOnline.com 1 someone's jeans pocket going thru the wash!): black lights (cumbersome); all the new security features (simplest of which is the watermark - it's the only part of the bill that has not yet been efficiently counterfeited. Just hold the bill up to the light) The Secret Service came back to us with this answer - even after all the changes. The most efficient way to discover a piece of counterfeit currency is to FEEL it! A teller handles so much currency in a day's time that the different feel of the paper stops that teller dead in their tracks. Counterfeits get by them when they ignore the feel. First published on BankersOnline.com 10/1/01 Dealing With Counterfeits by Mary Beth Guard BIO AND CONTACT INFO QUESTION: We've been hit with counterfeit bills lately, how should we instruct our stores to handle counterfeits? Should they retain them, call the police? We are concerned with their safety. Judgment call depending on the person passing the counterfeit. ANSWER: The Secret Service provides helpful guidance for dealing with counterfeit bills. You can educate your staff and your customers by using this link How to Detect a Counterfeit, http://www.treas.gov/usss/money_detect.shtml In terms of what to do when you get a counterfeit, follow these seven steps: If You Receive a Counterfeit , http://www.treas.gov/usss/money_receive.shtml 1. Do not return it to the passer. 2. Delay the passer if possible. 3. Observe the passer's description, as well as that of any companions, and the license numbers of any vehicles used. 4. Contact your local police department or United States Secret Service field office. These numbers can be found on the inside front page of your local telephone directory. 5. Write your initials and the date in the white border areas of the suspect note. 6. Limit the handling of the note. Carefully place it in a protective covering, such as an envelope. 7. Surrender the note or coin only to a properly identified police officer or a U.S. Secret Service special agent. Here's another informative resource on counterfeiting from the Bureau of Printing and Engraving, http://www.moneyfactory.com/. First published on BankersOnline.com 10/1/01 Training Guidelines for Counterfeit Detection Answers by BOL Gurus Barbara Hurst and Andy Zavoina QUESTION: Our store cashier recently accepted a counterfeit $50 bill. Are there guidelines for us to help train better for this? Copyright, 2004, BankersOnline.com 2 ANSWER by Barbara Hurst: BIO AND CONTACT INFO Fed has a packet out called "Know Your Money" that has some excellent tips and training tools. Call your local Fed, ask for their public relations office, and ask them to send some to you. The price is right - they're free. We also have an entire category of links on our BankersOnline.com Launch Pad on the subject of Counterfeits. From there, you can access various resources, including the Secret Service's publication "How to Detect a Counterfeit". Conversations over the years with Secret Service Agents tell us that with all the tricky tools on the market to detect counterfeits, they've found the most reliable to be the hands of the cashiers and tellers - that if it feels bad to them, it probably is. As for the new currency, the best verification we've found is the water mark. Hold the bill up to the light and check that - it probably is the most efficient way to tell if it's a good bill. ANSWER by Andy Zavoina BIO AND CONTACT INFO The Secret Service has dedicated a portion of their Web site to assisting you in detecting counterfeit currency. Look to http://www.treas.gov/usss/index.htm?money_detect.htm1 for assistance. First published on BankersOnline.com 5/7/01 Detecting Counterfeits: Money Counters and Special Pens Answers by Andy Zavoina and Barbara Hurst QUESTION: I have heard that there is available a money counter that can detect counterfeit bills or some type of ink pen that can be used to determine is the bill is fake. Do you have any information regarding these items? ANSWER by Andy Zavoina, BOL Guru: BIO AND CONTACT INFO Counterfeit bill detector pens can be purchased at most office supply stores and can cost as little as $5. Why aren't these in widespread use if they can be so inexpensive… caveat emptor. You may talk to your Federal Reserve Bank on things they have found useful and effective. Some items will be more effective than others and references from informed sources will be your best lead. ANSWER by Barbara Hurst, BOL Guru: BIO AND CONTACT INFO There are several products out there - but unfortunately, none is fool-proof. The black light about comes as close as anything. The pens work most of the time. But if a bill has been stuffed into a pocket, and the pocket has gone through the wash-dry cycle, the pen will show false. OR if you have a counterfeit that has been "treated" with hair spray - It may show up as good - even though it's counterfeit! The Secret Service says the best way to test for a counterfeit is to trust a teller's fingers and a teller's intuition. Some may still get by you, but we've found an experienced teller will let very few counterfeits escape. First published on BankersOnline.com 3/5/01 Currency Barbara Hurst, BOL Guru How good is your knowledge of currency? Take this quick quiz to see. Answers appear below. True or False? Copyright, 2004, BankersOnline.com 3 1. ____The largest U.S. bill ever issued was the $1,000 bill. 2. ____The same picture of the White House appears on the back of all of our paper 3. 4. 5. 6. currency except the $1 bill. ____The security thread in the 'new' 1996 $20 series includes a picture of the American flag. ____There is a watermark depicting the portrait shown on the right side of new bills. ____ The seal on the left side of the face of the bill, indicating which Federal Reserve bank printed it, was one feature left unaltered on the new currency. ____On the back of a $1 bill there are 13 steps on the pyramid, and the eagle has 13 stars in the constellation above its head, 13 arrows in its left claw, 13 leaves on the olive branch in its right claw, and it has 9 tail feathers. Know Your Currency There are three types of U.S. paper currency in use today. 99 % are Federal Reserve Notes. The other 1% are United States Notes and Silver Certificates, which are rarely seen, and are no longer printed. Each type is identified by the distinctive color of its Treasury seal and serial numbers. On Federal Reserve Notes these are green, on United States Notes they are red, and on Silver Certificates they are blue. Notes of the $500, $1,000, $5,000, and $10,000 denominations have not been printed for many years and are being withdrawn from circulation. The portraits appearing on these notes are: McKinley on the $500, Cleveland on the $1,000, Madison on the $5,000, and Chase on the $10,000. Differences That Are Genuine Design features sometimes vary from one series year to another. The most common change is the signature of the Secretary of the Treasury or the Treasurer of the United States. Another common variation occurs in the portrait of Andrew Jackson on the $20 note. In the 1934 and 1950 series years, he is depicted with one more finger showing than on notes of other series years. None show on the new $20. The 1966 series marked a change in note design. One hundred dollar United States Notes of that series year featured a re-designed Treasury seal with an English inscription replacing the Latin one. The new seal, phased in over succeeding years, appears on all Federal Reserve Notes of the 1969 series year or later. "In God We Trust" was first printed in 1955 on $1 Silver Certificates, 1935G series year. It was gradually phased in on other denominations and classes and is now printed on the back of all U.S. paper currency of the series year 1963B or later. Security Features Although all denominations of currency beginning with series 1996 have security features, several of the new features will vary according to the note's denomination and series. However, the basic appearance of all denominations will not vary. The new currency has the same historical figures and national symbols as the old series notes, in addition to having the same color, size, and texture of the older bills. A larger, slightly off-center portrait incorporates more detail. There is a watermark of the figure in the portrait to the right. New serial numbers were added that consist of two prefix letters, eight numbers, and a one-letter suffix. There is now a universal Federal Reserve seal rather than individual seals for each Reserve Bank. The security thread indicating the bill's denomination is now located in a different position on each denomination. The inscribed security thread in the 1996 series $20 and $50 also Copyright, 2004, BankersOnline.com 4 includes a flag. Optically Variable Ink (OVI) changes from green to black in the number in the lower right-hand corner of the bill when viewed from different angles. Microprinting appears in different areas on each of the denominations. Worn Out Money Even though United States currency is strong and durable, it does wear out with constant handling. The note most frequently replaced is the $1 denomination. There are over four billion $1 bills in circulation, and the life expectancy of each is approximately 18 months. Since larger denominations are handled less, they last longer. When a note is partially destroyed, the Treasury Department will replace it if clearly more than half of the original remains. Fragments of mutilated currency which are not clearly more than one half of the original whole note may be exchanged only if the Director of the Bureau of Engraving and Printing is satisfied by the evidence presented that the missing portions have been totally destroyed. Counterfeiting Counterfeiting of money is one of the oldest crimes in history. It was a serious problem during the 19th century when banks issued their own currency. At the time of the Civil War, it was estimated that one-third of all currency in circulation was counterfeit. In 1863, when we adopted a national currency, it was assumed that would solve the counterfeiting problem. However, by July 5, 1865, counterfeiting of the national bills became so extensive that the government established the U.S. Secret Service specifically to fight it. Although counterfeiting has been substantially curtailed since the creation of the Secret Service, this crime continues to represent a potential danger to the nation's economy and its citizens. Production methods used in counterfeiting operations have evolved over the years from the traditional method of offset printing to color copiers and, more recently, to scanners, computers, and inkjet printers. The United States Secret Service remains committed to zero tolerance and is determined to investigate each and every counterfeiting case. Answers 1. F, 2. F, 3. T, 4. T, 5. F, 6. T Copyright © 2001 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 11, No. 5, 5/01 “…A Woman Scorn’d” Barbara Hurst, BOL Guru "Heav'n has no Rage like love to Hatred turn'd, Nor Hell a Fury, like a Woman scorn'd " William Congreve, The Mourning Bride, 1697 Seven men from New York City evidently decided to have a "fling" at the Atlantic City casinos over Memorial Day. They got away with passing thousands of dollars in fake $100 bills in five casinos. But they made a big mistake when they paid a prostitute "for her services" with three of the counterfeits. She turned them in to the Secret Service. When they were arrested, their three hotel rooms were discovered to hold thousands more of the counterfeit bills. Several of them used false names and/or had fake Social Security numbers and immigrant identification cards. All seven-two from Mexico, two from Egypt, and one each from Colombia, Copyright, 2004, BankersOnline.com 5 Morocco and Ecuador-are believed to be illegal immigrants, according to the Assistant U.S. Attorney. Copyright © 1995 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 5, No. 9, 6/95 Funny Money Barbara Hurst, BOL Guru Huge amounts of counterfeit money was being carried into Asia by seemingly unsuspecting and innocent people. It was a big enough problem to start a special investigation. It really had the government agents stumped. But the answer really was simple. An ATM servicer who was taking care of the automatic teller machines at the Los Angeles airport had been working for a short while for his company. He was a good worker, never missed any time - considered a great employee - very reliable. Unfortunately, also very smart. He had discovered that the new color copiers made excellent copies - so good, as a matter of fact, that the ATM couldn't tell the difference between the touch of his product and real money. It will dispense color copies of the quality he was manufacturing. He would deliberately jam a machine, and then go service it, exchanging a pile of good currency for the counterfeit. Many people who were going out of the country would stop and get cash, and then exchange it in the foreign country for their currency. The servicer would "lose count" occasionally, but the machine, when settled, would always "come out ahead." Investigators finally put together the information they got from travelers about where they got their cash before leaving Los Angeles. They arrested the ATM servicer. Copyright © 1998 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 8, No. 2, 2/98 Child's Play Barbara Hurst, BOL Guru In Modesto, California, a second grade teacher noticed one of his 7-year-old students playing with $100 bills at recess. After being questioned in the principal's office, she said she had gotten them from her 5-year-old neighbor, who was in kindergarten. He came to the office, and while talking to detectives, said he liked to play with "…the money my grandpa makes." He had taken a handful from the stack of cash he found in the family van. "Grandpa", Jose Landeras, 42, was arrested and charged with forgery with intent to defraud and counterfeiting after detectives learned that he had been passing fake bills for about seven months through local towns, putting a large amount of counterfeit money into circulation. When arrested, police confiscated $2000 in phony bills, and a digital laser printer that was used to produce $5, $10, $20 and $100 bills. Copyright © 2003 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 12, No. 12, 3/03 For your information…It's Just Much Too Easy Barbara Hurst, BOL Guru The Secret Service has asked the U.S. Sentencing Commission to issue new guidelines on the sentencing of counterfeiters of U.S. currency. The Secret Service estimates there is about $32 million in counterfeit currency in circulation in the Copyright, 2004, BankersOnline.com 6 United States. Statistics just released by them say that in 1995 computer generated counterfeits accounted for less than 1% of those bogus bills. The other 99 1/2 % were produced by what they call the "traditional" method - that is, using engraved plates and offset presses. Because of the cost of "making" the phony cash, many thousands of dollars were produced, putting the criminal well into the sentencing guideline structure and guaranteeing removal of the "skill" from society at least for awhile. Now, however, using a scanner, instead of a few skilled individuals making a lot of counterfeits, there are many computer knowledgeable people making a few counterfeits each. In 1997 about 44% of counterfeit money in circulation was computer generated. In 1998, $8 million of the $18 million counterfeits were produced on a computer printer. The sentencing guidelines suggest probation for anyone with no prior arrests who is caught with less that $5,000 in counterfeits. It's not hard to scan and produce counterfeit currency. One high school student in New Mexico did it for a science project. The Secret Service got involved when some of her friends started spending the project material in local stores. There are security features in currency we are well familiar with. Comparing a real bill with a computer generated copy makes it easy to identify the phony one. The success stories in passing bad currency are in the retail industry - not in financial institutions. Our tellers' hands can tell the difference even before their eyes do! Copyright © 1998 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 8, No. 3, 3/98 Is It Real? Or Is It… Counterfeit? Barbara Hurst, BOL Guru Have you ever watched a skilled teller count cash? The teller's hands move so quickly that it seems impossible that they could feel any difference at all in the bills they are counting. But just let a counterfeit bill be in that stack of cash, and you'll see the teller's hands come to a screeching halt. He or she knows in that instant that this is a bad piece of currency-a counterfeit. The United States Government is more concerned than ever about increased counterfeiting. The banking industry is also concerned, because with new technology, the extremely sophisticated color copiers now on the market, and new laser techniques, the scope of counterfeiting has become a major problem. It has even gone beyond just currency. Duplicating currency is, however, the most frequent form of counterfeiting. If you happen to find a counterfeit bill in a deposit you want to handle it the way the Secret Service mandates. Reduce the deposit by the amount of the bill. Give the customer a receipt for that amount. Either place your initials and the date right on the bill, or put it into an envelope, seal it and put your initials and date on the outside. Then contact the Secret Service in your area. If the bill is good, they will tell you and you can then credit the customer. If it isn't, they may want information from you, and perhaps from the customer as to where the currency came from. The customer won't be happy at the loss, no doubt. But you should not give the bill back to the customer. There are several ways of counterfeiting currency. Offset printing, laser copies, and color copying are the most common. And of course, all are actual size. Copyright, 2004, BankersOnline.com 7 It used to be that you couldn't reproduce currency in any manner. But just a few years ago the law changed, and you may now copy currency as long as it is black and white, it must be at least 1 1/2 times larger than real currency, or less than 3/4 the original size. (That means if you are copying your bait money in actual size on your office copier, you're breaking the law! Set the copier on enlarge or reduce.) The new color copiers make excellent copies of currency. In most cases, however, you can spot them pretty easily. They'll have a shiny, glossy appearance to them. In some cases the fine detail may be blurred and solid looking instead of web-fine. Others, having been made on the brand new equipment, will have all details on the color copy-even the red and blue threads. But in all color counterfeits we've seen so far, no matter how good they look, the feel gives them away. There is just SOMETHING that feels different. A good teller will catch it every time. In a defensive measure, the U.S. Treasury has started circulating a newly designed currency with security features built in. For instance there is a polyester thread running down the side of the bill, visible from both sides, that will not reproduce on a color copier. And the new border around the portrait is so fine that if an attempt is made to copy it, it will only reproduce as a solid line instead of as the words "The United States of America" as is on the original. The $100, the $50 and the $20 are already in circulation. The $10 and the $5 will be out in 1993. The $1 will not be replaced with the new design. (See Vol.II, No. 7 for details on the new currency) Counterfeit currency runs in spurts. Where you find some, you'll probably find more. And you'll normally find them in your retail store deposits. Counterfeiters don't usually come into financial institutions with their phony currency. They know better. But often the bills will get past clerks in retail establishments. And to put to rest a myth about real currency-you very often hear someone say, "Rub the bill on a plain piece of white paper. If it's real, it won't rub off." Yes, it will. It will rub off in the same green it's printed. If you rub a color copy on that same piece of paper, it will more than likely rub off black instead of green. There are several "currency testers" on the market, but, according to the Secret Service, none of them are 100% fool proof. The only real 100% sure test, as a matter of fact, is to put it in a washing machine! Real currency will wash, dry and iron beautifully. No counterfeit will stand up to that test. Puts a whole new meaning to the term "Laundered Money", doesn't it? Isn't it strange that in this age of technology, we are back to basics to protect our institutions from this problem? Because whether it's currency, traveler's checks, checks or documents-whether it's color copier, laser, offset, or art-the best line of defense we have against counterfeits are the eyes and hands of our tellers. BANKERS' HOTLINE thanks the Counterfeit Desk Personnel of the United States Secret Service Philadelphia Field Office for their assistance in preparing this article. Copyright © 1992 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 3, No. 5, 9/92 Copyright, 2004, BankersOnline.com 8