The bill is the second in a series of new banknotes the Bank of Canada will introduce over the next two years. The first note, the $100 denomination, was released in November 2011.

The new Canadian banknotes feature security devices such as raised ink, a large transparent window that also contains a colour-shifting metallic portrait, hidden numbers in the transparent window that match the note’s denomination, transparent text, a frosted maple leaf window that also contains hidden numbers, among others.

The new banknotes are also newly designed.

This new $50 notes feature the Canadian Coast Guard ship “Amundsen” – a ship that “has been a major catalyst in the revitalization of Canadian Arctic science by providing Canadian researchers and their international collaborators with the platform and the tools to facilitate unprecedented access to the Arctic Ocean,” according to a website dedicated to the ship.

In line with this design, a ceremony to officially issue the new $50 banknote will be held at the Canadian Coast Guard’s Quebec port facility. The event will host speakers such as Mark Carney, Governor of the Bank of Canada, Shelly Glover, Parliamentary Secretary to the Minister of Finance, Marc Grégoire, Commissioner of the Canadian Coast Guard, and Louis Fortier, Scientific Director of ArcticNet.

Though the Bank of Canada has not set precise release dates for the rest of the denominations in the new series – the $5, $10, and $20 notes – it did say in a press release this week that that information would be forthcoming.

“The $20 note will be unveiled and issued later this year, with the remaining denominations to be unveiled and issued by the end of 2013,” the release said. “Further details regarding timelines for the unveiling and issuance of these notes will be made available in the coming months.”

SOURCES:
MarketWatch: “Bank of Canada To Begin Circulating New $50 Polymer Banknote”
Bank of Canada: “Banknotes” , Bank of Canada Issues $50 Polymer Bank Note, Slick new $50 polymer bill ready to line wallets.

The first time counterfeiting hit the radar of the Bank of Canada in major way was in the 1980s. In an effort to combat the up-and-coming technology of colour photocopying, the bank introduced a new series of banknotes with finer detail and new security features.

“Fine details in the face and hair of the Queen and former Prime Ministers depicted on the bills were too finicky for photocopiers to handle and appeared fuzzy in reproductions. A shiny gold metallic patch placed on each bill turned dark when replicated, further thwarting the forgers,” Globe & Mail writer Grant Robertson writes.

As technology advanced, Canada’s currency did not. Home computers became more affordable, graphics software was readily available, scanners were commonplace and ink-jet printers became the default for many households. Counterfeiting suddenly became easier than ever.

By the late 1990s, “the number of fake Canadian bills rose as high as 117 parts per million (PPM). Most G20 nations used 50 PPM as their benchmark to stay below,” says the Globe and Mail.

In 2002, 16 years after their last series was issued, the Bank of Canada introduced a new series to thwart the “computer-savvy do-it-yourself counterfeiter.”

Again, new security features were added to the note to ensure it would prevent forgeries. In particular, the new series featured a shiny holographic stripe down one side of the bill that shimmered in the light as well a watermark that appeared hidden but showed up when held to the light.

Four years later, in 2004, counterfeiters were learning to replicate the holographic stripe setting in motion the need to create a new series. In an attempt to create a product that was not only more secure but also a product that was more durable. For banks, the cost of producing new banknotes to replace damaged or used notes can be expensive. Polymer notes are typically two and half times more durable, according to the Bank of Canada.

In November, the Bank introduced the first polymer banknote in a developing series – a new $100 bill that contains several state of the art security features such as raised ink, a large transparent window that also contains a colour-shifting metallic portrait, hidden numbers in the transparent window that match the note’s denomination, transparent text, a frosted maple leaf window that also contains hidden numbers, among others.

Developing new banknotes in a timely fashion is one way for banks to stay ahead of counterfeiters.

“Counterfeiting rates have fallen steadily in Canada in recent years,” says the Globe and Mail. “The country now reports a parts-per-million ratio of below 40, which is finally in line with what most G20 nations consider acceptable.”

To read the full Globe and Mail feature, click HERE.

SOURCE:
The Globe & Mail: “Funny money: How counterfeiting led to a major overhaul of Canada’s money

The £5 banknote is the most likely candidate to be switched first as it is the lowest denomination and therefore the most frequently used, however the Bank has also said they would conduct test runs with £50 banknotes as well because they are the most frequently counterfeited.

Polymer banknotes are considered to be more durable than cotton-based notes, and provide unique opportunities for embedded security features.

“The Bank is look at ways of putting a see-through transparent window on [the new] notes as a primary security feature,” reported The Independent.

The decision to switch those notes to polymer hasn’t been set in stone. The Independent reports that a source close to the Bank said this project was still in “the evaluation stage” and that “a decision won’t be made for the next year or two.” If the plan goes ahead, the first polymer £5 banknotes could make their way into circulation by as early at 2013.

This isn’t the first recommendation the Bank of England has issued with regard to the £5 banknote. Last year, the Bank moved – at the request of merchants and consumers – to increase the amount of £5 banknote in circulation since they are the most frequently used bill in Britain. Since then, the Bank has churned out an extra 400 million £5 notes.

SOURCES:
The Independent: “British Bank Notes Set For Plastic Surgery”
Global Paper Security: “Britain To Increase £5 Banknote Output”

Modeled after the current cotton-paper blend banknote, the fakes have been making their way to gas stations, video stores, taxi companies and even banks according to the Nanaimo Daily News.

In the last month, police have recorded 14 incidents of counterfeit $100, 30% of those incidents were submitted directly to banks in payrolls.

Compared to the national average – around 18,000 fakes were discovered across the country last year – the number may seem low, but other Western regions such as Vancouver Island and areas in Alberta have also reported incidents of high-quality counterfeit hundreds.

Counterfeit production has become easier over time thanks to technological advances in colour copying, laser printing and embossing. Though equipped with security features to prevent illegal copying, some still manage to produce reasonably similar facsimiles.

The new $100 bill, which will enter into circulation in November 2011, ups the ante on security features in Canada. Retaining the colour scheme and imagery of the current Canadian banknotes, the bills feature new security features such as see-through windows, raised ink, hidden numbers, holographs, and metallic images to prevent counterfeiting.

The new bills are also made with plastic substrates in lieu of cotton because polymer banknotes are more durable than paper banknotes – a big selling point for the switch.

SOURCES:
The Nanaimo Daily News: “Counterfeit $100 Bills Showing Up In Nanaimo Stores”
Winnipeg Free Press: “Bank Of Canada Unveils Plastic $100 and $50 Bills

“In its annual statement of intent for 2011-2014, the bank said it would soon begin planning for a new series…which would include adding new security features to prevent counterfeiting,” Stuff.co.nz wrote last week.

Though a complete redesign of the banknotes in an “option,” head of communications for the Reserve Bank of New Zealand Mike Hannah said the official decision has yet to be made. He also said the central bank would reveal its plans in the coming weeks.

The current series of New Zealand banknotes has been in circulation since 1999, when the country switched from cotton-paper banknotes to polymer banknotes. The existing banknotes feature security features such as two transparent windows with embossed numerals and the image of a fern leaf, a shadow image noticeable when held to the light, individual serial numbers, raised printing, microprinting and special inks that make particular features glow under an ultraviolet light.

A new banknote series would include upgraded security features.

The Reserve Bank also said they were planning on reviewing the $5 note as an individual case, as it often “does not meet the public’s expectations” in terms of quality.

Should a new series of banknotes be introduced, the first notes could be expected in late 2014.

SOURCES:
Stuff: “Bank Note Revamp Considered”
Reserve Bank Of New Zealand: “Explaining New Zealand Currency”

New Jersey issued this six-pound note in 1761, during the French and Indian War. It warned "To counterfeit is Death," because counterfeiting was deemed a capital offense. Courtesy History.org

*This article is the first in a three-part series on counterfeiting.

The act of counterfeiting is as old as money itself. Plaguing ancient Rome, empirical China, newborn America, and many other nations over the past 2500 years, the illegal activity came hand in hand with the creation of money.

Even prior to the invention of coin and paper currency, counterfeiting was a popular form of trickery. In Prehispanic Mexico, for example, Cacao traders would extract the contents of the bean and substitute the valuable innards of the plant with soil.

In the ancient world, of course, currency was invented hundreds of years before these Mexican ruses. Real currency made its debut in the form of coins around 700 B.C. and counterfeiting soon followed. Coins had not yet been marked or etched with images or slogans, so reproducing coins out of less valuable metal was easy.

The problem became so severe in places like ancient Rome, that “it was considered treasonous and punishable by death if the perpetrator was caught. This was because many believed that anyone who disturbed the market with fake money was putting the nation’s economy and its general stability and strength in serious jeopardy.”

Those sentiments were echoed by the Chinese upon the invention of paper money, which appeared on the global currency scene during the Yuan Dynasty in the 13th Century. In order to prevent counterfeiting, “the Emperor ordered that the following be printed on all banknotes: ‘Counterfeiting shall be punished by death. Informers shall receive 250 taels of silver and the criminal’s property.’”

Throughout history, however, counterfeiting has not only come at the hands of criminals. The British government “produced large quantities of bogus assignats to undermine revolutionary France,” and helped the process of devaluating “Confederate paper money by printing it themselves and sending it to the South” in pre-revolution America to the point where Confederate banknotes were almost worthless.

By the end of the eighteenth century, counterfeiting was flourishing. During the Civil War, “one-third to one-half of the currency in circulation was counterfeit.”

Coin counterfeiting had become so advanced in the United States that “when the first federal coins were issued by the US government in the 1780s, they had the dies cut by an ex-counterfeiter in order to deter the practice.”

Paper money in the US was also being easily counterfeited because of merchants’ inexperience with the currency. One historian explains: “Rural colonists were not very familiar with paper money because their daily lives did not revolve around commercial transactions; furthermore, they had a deep prejudice against it because they did not regard it as ‘real’ money. Because merchants lacked familiarity with authentic paper money, they could be fooled by some surprisingly amateurish counterfeits.”

Though anti-counterfeiting measures were being developed throughout the world by the nineteenth century – particularly in America – counterfeiting continued.

One of the most professional cases of counterfeiting was carried out by the Germans in World War II who “had control of expert counterfeiters imprisoned in the Sachsenhausen concentration camp, and even manufactured very convincing paper, which can be more difficult to forge than a banknote’s appearance.”

The counterfeits produced by the Germans in the first half of the twentieth century were so good in fact that when The Bank of England managed to obtain some falsified British pounds, they said “the only way in which [the fake banknotes] differed from the real thing was that the real thing wasn’t as good.”

Today, thanks to modern advances in scanning and printing technology, counterfeiting paper banknotes is perhaps easier than ever. Because of this, security features are becoming an – if not the most – important part of banknote design.

In Part 2 of Counterfeiting: A Three-Part Series, we will take a look at the history of security features and identify how different security features have evolved over time to prevent counterfeiting.

SOURCES:
“History of Counterfeit Money”
“A Short History of Money”
“History of Counterfeiting”
“History of Counterfeiting”
“The History of Counterfeit in Russia”
“The Golden Age of Counterfeiting”
“History of Counterfeiting in Mexico”

Nearly 200,000 counterfeit euro20 banknotes were seized in the last six months says the European Central Bank

The European Central Bank (ECB) announced today that the number of fake euro banknotes seized in the last six months rose by eight per cent from the first half of the year.

“In the second half of 2009 a total of 447,000 counterfeit euro banknotes were withdrawn from circulation,” an ECB statement said.

Though the increase is significant, ECB officials say it is a step up from the first half of 2009, which saw a 17 per cent increase in seized counterfeit notes.

The most frequently forged bills were the euro20, which accounted for 47 per cent of the fakes, and the euro50, which accounted for 39 per cent.

The euro contains many security features that attempt to foil counterfeiters. Specific watermarks, security threads, hologram foil stripes & patches, iridescent stripes, and colour-shifting inks all play their part in deterring the reproduction of fake notes.

Though the ECB’s statement demonstrated concern at the growing ability to produce successful counterfeit euros, the Central Bank also remained steadfast in believing it was a manageable problem.

“When compared to the 12.8 billion genuine banknotes in circulation,” the ECB statement said, “the proportion of counterfeits is still very low.”

Nearly one million counterfeit euros were seized and withdrawn from circulation in 2009.

SOURCES:
Chicago Sun Times: “Amount of counterfeit euros up.”
“Fake euro seizures rise by 8%: ECB”

India is expected to introduce polymer 10-rupee banknotes by the end of 2010.

The RBI says that India has seen a 95 per cent increase in counterfeit notes in the country over the past five years.

“India needs to invest more to make the system robust. Counterfeiters are becoming more tech savvy and larger interests may be involved,” said Mohandas Pai, a member of the RBI’s expert committee on currency distribution.

Polymer banknotes not only include advanced security features, but the chemical bonds used in the creation of polymer also make the banknote more durable – a feature that is highly appealing to the RBI.

Much like Ukraine (read: Russia to stop making 10-ruble banknotes), India remains a largely cash-preferred country. In marketplaces and shopping centers, “grubby banknotes are legion – ripped, sullied, scribbled on or simply overused to the point of illegibility. Nobody wants them and, if you’ve got one, spending it is going to involve either subterfuge or confrontation.”

The RBI said that 12 billion notes were classed as “soiled” as of March 2009, and admits that maintaining quality is a “huge challenge”.

Many countries around the world use polymer banknotes, including Australia, New Zealand, Romania and Vietnam.

India’s trial period for polymer banknotes could begin as early as next year, however the changes to the currency – from cotton blend paper banknotes to polymer banknotes – will only target India’s 10-rupee banknotes.

RBI officials have said the initial plan is to introduce one billion 10-rupee notes before the end of 2010.

Even with the anticipated switch, approximately 95 per cent of the country’s currency will still be printed on traditional cotton banknote paper.

For more about polymer banknotes read Polymer banknotes of the world.

SOURCE:

Ninemsn.com: India tackles counterfeit money problem

The Reserve Bank of India lists banknote security features on its website.

Ever wondered exactly what kind of security features are embedded in the cash you carry?
If you live in India, you no longer have to wonder.

The Reserve Bank of India (RBI) has posted a comprehensive list of security features on its Mahatma Gandhi Series banknotes on its website.

The Gandhi Series has been in production since 1996.

Though India’s currency is currently printed on a traditional cotton and paper blend of banknote paper, the RBI has announced earlier this month that it will begin a test-run of manufacturing polymer banknotes in 2010 to combat both the cost of replacing worn bills and counterfeiting.

Only the ten rupee banknotes will be printed on polymer paper.

SOURCES:
Reserve Bank of India
Ninemsn.com: India tackles counterfeit money problem

WATCH: Polymer Banknotes around the World

Polymer banknotes are made by applying two layers of ink side of each side of the bank note excluding the space for creating OVD (optically variable device – a security feature that varies from country to country). After that the polymer is cut into sheets and then is printed on. The final stage of the polymer banknote creation is covering the note with very thing protective layer.

From the polymer film to the finished banknote, every aspect of the production contributes to make polymer banknotes a safer alternative to paper banknotes.

So who uses polymer banknotes?

Here’s a video detailing how many countries around the world use this kind of cash:
Polymer Banknotes of the World

SOURCES:
ElementsDatabase.com: “The Chemistry of Polymer Banknotes”
Noteprinting.com