Currency to Foil Counterfeiters Hangs by Thread


The Treasury Department unveiled a new $100 bill Thursday designed to foil counterfeiters by including a polyester thread that cannot be reproduced by state-of-the-art copier machines.

The change, the first in U.S. currency in more than 30 years, comes because crooks using high-tech color copiers, graphic computers and laser scanners could soon be capable of making facsimiles virtually indistinguishable from the real thing, Treasury Secretary Nicholas F. Brady said.

Starting next month with $100 bills, and expanding to $50, $20, $10 and $5 bills, most folding money will incorporate two new features: a nearly invisible band of microscopic printing around the portrait on the face side of the bill and a “security thread:” a polyester strip embedded in the paper on the left side of the bill’s face containing tiny letters visible only when held to a light--but invisible, and hence not reproducible, on a copier.

Anyone wanting to check the authenticity of a bill could hold it to the light; if the thread was not there, the bill would be a fake. However, some of the old-style bills will still be in circulation for a while--until they wear out or until enough of the new bills are available to take their place.


At present, Brady said, the advanced copiers are not widely available and “counterfeiting of this kind is very rare.” But phasing in the new currency now, he said, will “stay ahead of technology” so that counterfeiters who gain access to the new copiers in a few years “will be greatly deterred from quickly and easily making bogus bills.”

Added Assistant Treasury Secretary Hollis McLoughlin: “There have always been counterfeiters out there and . . . we see this as a normal progression of staying ahead of the bad guys.”

U.S. currency was last altered in 1957, when the words “In God We Trust” were added under orders from Congress.

The new features involve almost no visible change in the basic size or design of the familiar greenback. The Treasury overruled a Federal Reserve recommendation that the new currency incorporate background coloration and other more radical design changes.


That disagreement did not surface at Thursday’s news conference at Treasury, where Fed Chairman Alan Greenspan appeared with Brady. But Fed officials explained privately that they had concluded from a series of focus groups with consumers and clerical workers who handle large quantities of currency in their jobs that they prefer designs incorporating new background colors.

Treasury ignored that advice and went with the most conservative design--in effect, no design change. As Brady noted, squinting at a $100 bill while holding it up to the light to see the security thread, the alterations are “so subtle that most people wouldn’t notice it.”

The thread is imprinted with the letters USA and the denomination--100 for the first bill to be produced and distributed, later to be followed by 50, 20, 10 and 5--in a repeating pattern in letters barely large enough to be read, but invisible in the reflected light needed by copiers.

Even more subtle is the microprinting around Benjamin Franklin’s portrait on the note’s face. To the naked eye it looks like a fuzzy line following the contour of the portrait’s oval frame. Under a magnifying glass the fuzzy line turns into the words, in capitals, “THE UNITED STATES OF AMERICA,” printed repeatedly around the oval.

Treasury and the Fed decided that the new money should be phased in gradually as existing currency is recycled, without the disruption of calling back any existing bills.

Production of a $50 note with security thread and microprinting is scheduled for late 1991, with the $20 bill by late 1992 or 1993. Production and distribution of all denominations except the $1 bill, where the danger of counterfeiting is considered minimal, is to be well under way by 1995.

At present, counterfeiting is not considered a major problem, at least in proportion to the money outstanding. Last year, total counterfeit currency seized amounted to barely 0.1% of the $77 billion in genuine currency produced by the United States, and less than 0.03% of the $268 billion then in circulation worldwide.

But the total production of counterfeit money still totaled $80 million--a tidy sum, even though $66 million was seized before it was circulated. Moreover, counterfeiting, especially of the bigger bills, has been increasing as photocopying techniques have improved over the last 10 years. In 1980, the Treasury says, about 778,000 phony $50 and $100 notes were passed and seized. By 1990, the bogus $50s and $100s seized by the Treasury surpassed 1.2 million.


Treasury rejected other anti-counterfeit techniques found in some European currencies, including watermarks in the paper; holograms and interference filters, both of which change color or image when tilted.

Watermarks were rejected because a redesign would have been necessary, the other methods because they were considered too expensive and too fragile for the abuse paper currency absorbs during its life span--which varies from more than eight years for $100s to two years for $20s and about one year for $5s and $10s.

Staff writer Jim Risen contributed to this story.

Thwarting Counterfeiters

The Treasury Department is taking steps to stay ahead of increasingly sophisticated, high-tech counterfeiters--those with access to laser scanners, precise color copiers and digital printing equipment. The new $100 bills will be brought gradually into circulation, while smaller-denomination notes will beintroduced during the next year.

Security Thread:

A polyester “security thread” is embedded in the paper on the left side of the portait of Benjamin Franklin. Printed on the polyester thread are the Federal Reserve seal, “USA” and the denomination. The thread is visible only when the bill is held up to a light and cannot be duplicated by copying machines.



The new bill carries the words “The United States of America” in a fine line of microprinting around the border of the portrait. The printing is too fine to read without magnification.


Paper: Cotton and linen rag with visible fibers. Has strong, pliable feel, no watermarks. Printing: Engraved-plate printing provides a slightly embossed effect. Fine engraving notable in borders, denomination marks, typography. Portrait: Drawn with minute detail on a fine-screen background. Serial Numbers: Distinct type and spacing in green ink; no two numbers of same series and denomination are alike. Federal Reserve Seal: Shows issuing bank, matches first letter of serial numbers. Treasury Seal: Green ink matches serial numbers with denomination superimposed in black ink.