Small Business

Knowing the Score About False Notes


By Karen E. Klein Small-business owners who handle a large number of cash transactions should always be on the lookout for counterfeit currency, which is increasingly common due to sophisticated computer design-and-printing programs, officials say.

That's also why it's vital to thoroughly review the paper money you receive, which means that you and your employees need to take the time to make sure that you and your employees know the hallmarks of a genuine bill vs. a fake. The U.S. Secret Service, the agency charged with investigating counterfeiters, says that those who fail to carefully examine the money they receive, or who cash checks and bonds without requesting proper identification, are potential victims.

The Secret Service, a division of the Treasury, has a Web site that offers specific tips about how to spot phony greenbacks. If you receive cash that looks or feels suspect, compare it with notes you know to be authentic, paying close attention to the quality of printing and the characteristics of the paper. Remember, the key is to spot the differences, not the similarities.

According to the Secret Service, some of the most important points of comparison include:

The portrait. If the note is the real McCoy, the image will be lifelike and stand out from its surroundings. Unlike a bona fide note, the counterfeit will almost always appear flat and uninspired, with details often merging into a background that is too dark or appears mottled.

Federal Reserve and Treasury Seals. On a genuine bill, the saw-tooth points of the Federal Reserve and Treasury seals are clear, distinct, and sharp. The counterfeit seals may have uneven, blunt, or broken saw-tooth points.

Border. The fine lines in the border of a genuine bill are clear and unbroken. On the counterfeit, the lines in the outer margin and scrollwork may be blurred and indistinct.

Serial Numbers. Genuine serial numbers have a distinctive style and are evenly spaced. The serial numbers are printed in the same ink color as the Treasury seal. On a counterfeit, the serial numbers may differ in color or shade of ink from the Treasury seal. Also, be on the lookout for notes with serial numbers that are unevenly spaced or aligned.

Paper. Genuine currency has tiny red and blue fibers embedded throughout. Counterfeiters often try to simulate these fibers by printing tiny red and blue lines. Close inspection reveals, however, that on the counterfeit note, the lines are printed on the surface and are not an integral element to the paper. Since it is illegal to reproduce the distinctive paper used for U.S. currency, the fibers -- or their absence -- can be the most telling indicator.

If you do get a counterfeit note, what should you do with it? Keep the bill and make an excuse to delay the person who passed it by some excuse if possible, the Secret Service says. Meanwhile, contact the police or the U.S. Secret Service field office nearest you. Get a description of the passer and that of any companion or vehicle used. Write your initials and the date on the bill, and surrender it only to the police or the U.S. Secret Service.

For more information on counterfeiting, and a downloadable form you can use

to report a counterfeiter, click here. Have a question about running your business? Ask our small-business experts. Send us an e-mail at smartanswers@businessweek.com, or write to Smart Answers, BW Online, 46th Floor, 1221 Avenue of the Americas, New York, NY 10020. Please include your real name and phone number in case we need more information; only your initials and city will be printed. Because of the volume of mail, we won't be able to respond to all questions personally.


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