Money Counterfeiting

The U.S. federal government has the exclusive authority to print or coin United States currency. Currency produced anywhere other than the two U.S. Mints operated by the Department of the Treasury, along with any valid currency that has been fraudulently altered, is considered counterfeit. Producing or distributing counterfeit money, or knowingly attempting to use counterfeit money, is a criminal offense under federal law.

United States Currency

The common conception of counterfeiting involves fake cash, but it can involve many other types of forgery. Federal laws against counterfeiting apply to any “obligation or security of the United States,” defined to include not only coins and paper money, but also Treasury bills, Federal Reserve notes, bonds, and other financial instruments issued by the United States government.

During the 2013 fiscal year, federal authorities recovered about $88.7 million in counterfeit U.S. currency. Many of these counterfeit bills circulate in other countries. The U.S. Secret Service, which investigates alleged counterfeiting, estimates that about half of all of the genuine U.S. currency in circulation—according to a 2006 report, the amount was approximately $450 billion out of a total of $760 billion—is held abroad. Federal law allows prosecution for acts of counterfeiting committed outside the U.S., but the U.S. has not ratified the main international treaty, the International Convention for the Suppression of Counterfeit Currency.

Digital Technology

Counterfeiting was once a very difficult process, involving enormous amounts of both time and labor. It required creating detailed plates for printing, finding the right types of papers and ink, and printing the bills accurately. Digital technology and printers have made the process easier, although paper and ink are still critically important.

Prohibited Acts

Federal law prohibits anyone from “forg[ing], counterfeit[ing], or alter[ing] any obligation or security of the United States” with the “intent to defraud” any other person. It further prohibits any attempt, with fraudulent intent, to use or introduce counterfeit currency in commerce, such as by using it to make a purchase, depositing it with a bank, or selling it to another person. The requirement that a person act with “intent to defraud” is intended to protect people who unknowingly receive counterfeit money and then try to use it to buy something.

The creation or possession of any instrument used to produce counterfeit currency, such as metal plates used to print bills, is also considered a counterfeiting offense. This includes scanning or making digital copies of any bills or other “obligations or securities,” with the intent to use them in counterfeiting. Many software applications block scanners and other imaging devices from capturing images of U.S. currency because of this law, but digital technology reportedly presents the biggest challenge to the Secret Service.

Possession of Certain Items Also Prohibited

The possession of certain seemingly harmless items may also be prohibited by federal counterfeiting law, if the Treasury Department designates them as “distinctive.” This includes certain types of paper used to print money and certain “deterrents,” such as security thread or particular types of ink, used during production to make counterfeiting more difficult. These items become illegal to possess after the Treasury Department adopts them for its own exclusive use.