Counterfeit money is imitation currency produced without the legal sanction of the state or government usually in a deliberate attempt to imitate that currency and so as to deceive its recipient. Producing or using counterfeit money is a form of fraud or forgery.
Counterfeit currency has been in circulation for nearly as long as currency itself. Modern day tactics to establish valid currency include high quality printing, seals by the Federal Reserve and Treasury, printed serial numbers, and a very specific type of paper that has tiny red and blue fibers embedded throughout.
Some of the ill-effects that counterfeit money has on society include a reduction in the value of real money; and increase in prices (inflation) due to more money getting circulated in the economy – an unauthorized artificial increase in the money supply; a decrease in the acceptability of paper money; and losses, when traders are not reimbursed for counterfeit money detected by banks, even if it is confiscated.
Nations have used counterfeiting as a means of warfare. The idea is to overflow the enemy’s economy with fake bank notes, so that the real value of the money plummets. Great Britain did this during the American Revolutionary War to reduce the value of the Continental Dollar.
Security is a mandatory prerequisite in banknote development – reliable protection is the only way to create long-term trust in a payment medium. There is no straightforward, off-the-the shelf solution for protecting a banknote. Each country determines forward its own requirements for security features and their individual characteristics, always closely co-ordinated within the design scope. The security features in a banknote must also be appropriate to the denominations and cash cycle requirements.
Engineers and Researchers are constantly innovating to challenge counterfeiting, by constantly refining security features. This enables central banks to select their individual solution from a scalable product portfolio including Whether watermarks, threads, foils, see-through windows, machine-readable or printed security elements, our solutions are amplified on the banknote to create effective protection. Public features are attractive and quickly recognizable, enabling people to easily authenticate a note, while machine-readable features reliably capture the “hidden” features.
Traditionally, anti-counterfeiting measures involved including fine detail with raised intaglio printing on bills which allows non-experts to easily spot forgeries. On coins, milled or reeded (marked with parallel grooves) edges are used to show that none of the valuable metal has been scraped off.
One of the most common security features, watermarks are created by using different thicknesses of paper in the printing process. When hit with light, an image will be illuminated. Tiny text, which can only be read with a magnifying glass, is a common safety feature on many bills globally.
In 1996 Australia became the first country to have a full series of circulating polymer banknotes. On 3 May 1999 the Reserve Bank of New Zealand started circulating polymer banknotes printed by Note Printing Australia Limited. The technology developed is now used in 26 countries. Note Printing Australia is currently printing polymer notes for 18 countries.
Roughly 42% of banknotes issued since 2011 use color-changing features in which parts of the note change color to the viewer depending on the angle. Many notes use Security thread as security feature, which consists of a thin ribbon that is threaded through the note’s paper.
Notes can also incorporate ink or markings that are only visible in fluorescent or infrared light, making them invisible to the naked eye. Recently, there has been a discovery of new tests that could be used on U.S. Federal Reserve Notes to ensure that the bills are authentic. These tests are done using intrinsic fluorescence lifetime. This allows for detection of counterfeit money because of the significance in difference of fluorescence lifetime when compared to authentic money.
More than 300 denominations in 97 currencies use holograms for protection, making them one of the most common security features globally. They can be incorporated into designs by the way of security threads, stripes, patches and window features.
Ideas wanted for future banknote security print tech
A call for innovations that could become security features on future banknotes has been launched by the Defence & Security Accelerator (DASA) and the Bank of England.
DASA is part of the Ministry of Defence. Its remit is to find and fund “exploitable innovation to support UK defence and security quickly and effectively, and support UK prosperity”.
The market exploration is aimed at developing an understanding of capabilities that currently exist, or of new ideas that could potentially become new security features for banknotes.
“The Bank of England is now looking ahead and inviting ideas to develop novel security features and print technologies for consideration for potential use in future generations of banknotes,” DASA stated.
It said the technologies would need to be suitable for integration into a banknote design, and fulfil the following criteria: be difficult to counterfeit or simulate; easy to communicate, and easy and intuitive for the public in use; durable; and compatible with high-volume printing techniques.
Techniques that will not be considered include holographic foils, lenticular lens features, and optically variable inks.
Current banknotes have a range of overt security features to help the public recognise genuine notes, such as see-through windows (in the case of polymer banknotes), colour-shifting foils with fine details, raised printing, and holograms with flipping images.