New greenbacks: how to make a buck - literally - design of new paper money; includes article about detering counterfeiting - Cover Story

Science News, Jan 27, 1996 by Richard Lipkin, Damaris Christensen

Suppose you wanted to found a world power. To get the new nation's economy rolling, you'd have to provide its citizens with currency. You'd want to design handsome, durable bills. They must feel substantial and look majestic enough to engender national pride.

On the other hand, this currency can't be costly to produce. It must roll off presses easily, survive its contact with 10,000 sweaty palms, and after years of fingering, crumpling, laundering, and even bleaching, remain recognizable. "Any scientist who thinks this is a trivial problem is out of his gourd," says Robert R. Shannon, an optics researcher at the University of Arizona, Tucson.

Moreover, the bills must be tough to reproduce. "When it comes to counterfeiting," he adds, "you have to fool some very clever people."

Such considerations represent only the tip of the iceberg for the U.S. Treasury Department's Bureau of Engraving and Printing (BEP), the federal agency responsible for producing the greenbacks that grace U.S. wallets. Faced with the rapid rise of desktop publishing-complete with top-notch ink-jet printers, color copiers, and scanners-BEP has had to confront a sobering reality: Uncle Sam's greenbacks may soon be under siege.

With $380 billion in circulation worldwide, Washington finds itself hard-pressed to keep track of every note. In 1994, the Secret Service seized $45.7 million in counterfeit bills before they entered U.S. circulation-though forgers successfully sneaked $25.3 million in fakes into the economy.

Overseas, where counterfeiting of U.S. currency occurs more frequently, agents detected another $137.7 million in bogus bills.

Of the counterfeit notes, 90 percent emerged from conventional printing processes; however, the number of bills produced with the new reprographic technology is growing alarmingly. In 1992, forgers used the new techniques to create an estimated $6 to $8 million in notes-an amount that has doubled every year since 1989.

If the number of forgeries were to continue to increase at this rate until the year 2000, then $1.6 billion in high-tech fraudulent currency would pollute the economy, a National Research Council (NRC) committee warns.

Even a casual experimenter-not to mention dedicated professionals-can jaunt over to a computer store, buy an off-the-shelf system, counterfeit money, then throw the equipment away. Such fake notes, agreed scientists on NRC's committee on next-generation currency design, could quickly overwhelm anticounterfeiting efforts because tracing the bills to their source is "very difficult."

"The quality of the reproduction can be very high," they report, "and not solely dependent on the skill of the counterfeiter." Moreover, because a currency's value hinges on public confidence, a steady trickle of fakes could threaten the dollar's integrity.

That threat has forced a rethinking of U.S. currency.

In 1990, an interagency counterfeit deterrence committee convened to evaluate the integrity of U.S. notes. Since then, a wide variety of potential alterations has gone through testing. Based on the committee's recommendations, the secretary of the treasury decided in July 1994 that U.S. bills need a redesign.

This year, the Federal Reserve will begin circulating a newly designed $100 bill. The note incorporates several safety features whose efficacy federal agents will monitor carefully during the next few years. Ultimately, the treasury plans to redesign U.S. currency at the rate of one denomination per year, moving from the $100 note to the $1 bill.

The potential of desktop counterfeiting has guided the design, materials, and production decisions of the next generation of U.S. currency-and will undoubtedly do so well into the next century. "We want to discourage people from driving to their local copy shop and printing up cash for the weekend," says Shannon. "Yet, at the same time, any security-enhancing feature added to currency must also be acceptable technologically and politically to society.

"This requires a delicate balance."

Although it considered printing the bills on plastics, synthetics, high-tech cloth, and other materials, the interagency committee ultimately advised the treasury to stick with the traditional paper, a blend of 75 percent cotton and 25 percent linen. While less durable than the alternatives-a $1 bill typically survives only about 18 months-this paper has a distinct and identifiable feel that proves not only difficult to copy but helpful in snagging fakes.

"Many counterfeits are still caught when people who handle money say that it just doesn't feel right," says Sara E. Church, a BEP materials scientist.

Imitating the texture of money "is not a trivial production problem."

In the intaglio process long used for Uncle Sam's greenbacks, hand-crafted plates that press ink onto paper give each note a distinctive embossed texture. Intaglio images remain crisp for a long time before fading. Moreover, since intaglio requires millions of dollars of machinery and great finesse, the process remains quite difficult to replicate.