Weird Money Facts: 10 Things You Didn't Know About Counterfeit Money
The chances are, you've exchanged fake money at some point in your life. Most likely you haven't realized it, as counterfeits are getting harder and harder to spot. Last year, the Secret Service seized almost $89 million in counterfeit money, and the problem is only getting worse. Consider the following 10 facts about counterfeit money — they may encourage you to look a little harder at the bills in your wallet or purse. (See also: Counterfeiters Beware: Here's How the New $100 Will Ruin Your Day)
1. The $100 Bill Is the Most Counterfeited Bill in Circulation
You may have heard that the $20 bill is the most counterfeited, and that would make a lot of sense. When you hand over a $100 bill, it gets more scrutiny. But $20 bills are usually taken without any kind of security check. Even $50 bills get a second look, so why does the $100 bill take the top spot? A detailed study by the Federal Reserve Bank of Chicago breaks it down, but basically it all boils down to the quality of the bills. Fake $20s are much easier to spot and are easily dropped out of circulation. But $100 counterfeits are of much higher quality.
2. Ridges Were Put on Coins to Stop Counterfeiters
Have you ever wondered why coins like quarters and dimes have those little ridges on the edge? Well, it all stems from measures to protect you from counterfeits. Back in the day, when coins were made from gold and silver, people would clip the edges off coins and collect the shavings. Over time, they would have enough to make other gold and silver coins, and most people didn't notice coins that will a little lacking in diameter or circumference. The ridges added to the pressed coins stopped these coin clippers in their tracks. Of course, modern crooks have found new ways to manufacture coins with ridges, with the British Pound Coin suffering from millions of fakes every year.
3. Counterfeit Money Has Been a War Strategy
Another "strange but true" fact, but a very powerful one. During wars, nations will produce counterfeit currency of a country they are at war with as a simple way to bring the opponent's economy crashing down. One famous case of this involves the British government flooding America with phony currency during the 1776 War of Independence. The Brits did it again during World War II, and the Japanese printed Chinese currency in the 1930s and 1940s. Why? Well, there were umerous reasons. The most obvious is to create hyperinflation. Counterfeit money can also be used to pay informants and buy munitions. (See also: 5 Cases of Hyperinflation)
4. Banks Hand Out Counterfeit Bills
Don't think that you're protected from fraud by getting the bills directly from your bank. Even they can fall victim to counterfeit money, especially those fake $100 bills mentioned earlier. Last year, a grandmother named Arlyne Lorenz withdrew $300 from her bank in New York and deposited it less than an hour later into her stepdaughter's bank. That's when the fakes were discovered, and the bank that issued them refused to refund her loss (the local news station managed to rectify that situation for her, but you may not be so lucky). So, what can you do about it? Well, although it may be a pain, ask the bank to check the money they give you before you leave. Once you're out the door, it's your problem.
5. Anyone Can Produce Quality Fakes
Technology has changed the way counterfeit money is being produced. Just 20 years ago, 99% of counterfeit money was created using sophisticated methods, large-scale printing presses, and forged plates. Today, 60% of counterfeit bills are made using standard inkjet and laser printers that can be bought from any retail store. Recently a woman counterfeited $20,000 in fake bills simply by soaking $5 bills in degreaser, scrubbing off the ink, and printing over them with scanned $50 and $100 images. It was all done on a cheap HP printer.
6. Counterfeiting Was Once Punishable by Death
Today, depending on the severity of the crime, counterfeiters can get away with a fine (albeit a hefty one). But in the 18th century, it was a different story. Benjamin Franklin himself printed warnings on the twenty shillings bills, which read "To Counterfeit Is Death." And people who were caught counterfeiting money in England in the 17th century were hung, drawn, and quartered.
7. The Secret Service Was Founded to Stop Counterfeiters
You think of the Secret Service as the government agency responsible for the protection of the President of the United Stated. But they only began to fill that role in 1902, one year after the assassination of President William McKinley. Before that, the Secret Service was responsible for dealing with America's counterfeit money problems; and they were created by President Abraham Lincoln to fulfill that task. At that time, one third of the money in circulation was fake. With the country in a financial crisis, this was a crucial role.
8. Counterfeit Money Is Readily Available on the Dark Web
You may not know of the dark web yet, but it's becoming more well known every week. The dark web is the underground of the Internet, and a primary reason Bitcoins were invented; basically, untraceable money for untraceable products. In the dark web, you have access to guns, drugs, explosives, bullets, and fake money. For those foolish enough to risk it, quality counterfeit notes are available for a fraction of the price of real money — perhaps $20 for five fake $20 bills. Of course, should you get caught buying or using these, expect the punishment to be severe.
9. Today, Most Counterfeit Coins Simulate Rare Coins
With the cost of materials and production methods being much higher than that of printing paper money, there's only one way to make a profit with coins — counterfeit the very rare ones. A 1920s Liberty Half Dollar can change hands for $40,000! That's the kind of money that will attract criminals from across the globe. In comparison, spending all that time and effort to mass-produce quarters, nickels, and dimes just isn't worth the effort.
10. Sometimes Even Obvious Fakes Are Accepted
Would you accept a $200 bill with President George W. Bush's picture on it? Well, of course not. But a clerk at a Dairy Queen in Kentucky did in 2004, and happily gave the customer $198 in change. The bill was clearly a joke, and even the denomination is absurd. But it just goes to show, if you're not paying attention, mistakes can be made.
Have you ever been passed a counterfeit? How'd you spot it? Please share with a bona fide comment!