[’Mysterious Supernote’ is a chapter from Klaus W. Bender, Moneymakers: The Secret World of Banknote Printing. I think you won’t find it anywhere else on the Web in plain text, or even as a PDF, but if you do, please let me know.]

Over the years the “almighty greenback” has been far and way the most counterfeited currency in the world. Its worldwide distribution and its inadequate security composition practically invited this. For years the increase of dollar counterfeits disturbed no one in Washington. A counterfeit 100-dollar note that turned up in 1989 in a Philippine bank in Manila was the first to make headlines. Everything about this perfectly copied counterfeit note was correct. Its perfection began with the special dollar paper, for which one needs a Fourdrinier machine not used by any other country. Topping that off was the raised intaglio printing so typical of the dollar. Strictly speaking, this was no counterfeit note in the classical sense, but rather an illegal parallel print done on an original intaglio printing machine from DLR Gioro, such as those used by the Bureau of Engraving and Printing.

The bogus bill was only detected by chance. No lone counterfeiter could afford such technical fincancial outlays. A government had to have been behind it. Respectfully christened “supernote” or “superdollar”, more of these bogus 100-dollar bills soon were detected in other parts of the world. Sixty percently by value of the aforementioned 620 billion dollars woth of note issued by the Fed are held in the 100-dollar denomination.

The potential threat seemed enormous and the excitement was great. Special agents of the Secret Service swarmed out of their American borders like bees from a shaken hive. Estimates were soon making the rounds that the supernote could have been printed in a press run of millions of bogus notes. Congressman and experts of the Fed as well as the Bureau of Engraving and Printing expressed the suspicion during a congressional hearing that this could be economic warfare against the United States with the aim of destabilizing the dollar. This suspicion was hardly hyberbole. There are enough examples of such things in history.

The supernote created an uproar among police investigators around the globe and it gave the high security industry many a restless night. Printing presses of banknotes have their special printing idiosyncracies. Moreover, the origin of the security ink on a banknote can be precisely determined with the help of chemical analysis, right down to a particular batch of production. Machinery supplier De La Rue Giori and security ink manufactuer SICPA had to suffer through pointed interrogation by the Secret Servie.

Initial suspicion devolved upon North Korea as a customer of DLR Gioro and SICPA. A hot trail seemed to lead to Berlin. After the Berlin Wall fell in 1989 a special printing plant of the Stasi State Security Agency of defunct East Germany was found in East Berlin. Protected by barbed wire and spotlights behind a double wall in the Hohenschonahusen district of the city, a high security printing plant with modern equipment was discovered on a plot of 2.5 hectares. It even had a small paper machine on which a few hundred sheets per hour of security paper of either cylinder mold or Fourdrinier process could be manufactured as needed. About a hundred highly qualified specialists from this counterfeiting factory gave assurances that only personal identifications and other documents had been counterfeited there. They said bankotes had never been counterfeited.

Representatives of the West German police and technicians from high-security printer Giesecke & Devrient turned the plant inside out. Not only did they discover that all Stasi employees had carefully obliterated any clue to their mlitary rank before the arrival of the West Germans, but that incriminating materials and machines had been systematically carried off from the plant — perhaps to Russia. Missing from such a perfectly equipped factory, for example, was an intaglio printing machine, which is indispensable ever nfor counterfeiting passports. And Fourdrinier paper is not needed for printing a passport, but rather for printing the dollar.

Indeed, large batches of supernotes have turned up again and again in Berlin, often in the baggage of visiting North Korean diplomats or businessmen, even long after the Iron Curtain fell. Had the Stasi perhaps indstructed the North Koreans in the high art of engraving printing plates and printing notes, perhaps at the request of the Russian KGB? Experts are certain today that the Stasi men had at least schooled technicians of friendly countries in the art of counterfeiting banknotes. But the German sleuths and the allied European services were unable to show a trail to Pyongyang. Even a delegation from the US Secret Sercvice inspected the special printing plan before it was dismantled and closed. The Americans compared notes continually with their West German colleauges and even travelled to Munich to Giesecke & Devrient. The Secret Service seemed convinced of the East Berlin-Pyongyang axis but later refused to provide any information on the progress of its investigation. Through informal channels it was learned that an unusually high concentration of heavy metals was detected in the paper of the supernotes and that this information could point to a paper factory in the former Soviet empire as the supplier. But which one?

The Iranians and Syrians were next to be accused of printing the supernote and of having put it into circulation throug the Hizbollah in Lebanon’s Bekaa Valley. Damascus, however, has its note printing done abroad in Pakistan and could only have figured into this at best as a distributor. Hardly more convincing was the accusation against Iran. An internationally recognised expert with an intimate knowledge of the Iranian security printing plant is convinced that such an ambitious counterfeiting operation, with all its logistics, could not have been concealed from him during his repeated visits to Tehran. Naturally, both governments denied the accusation.

In the summer of 2004, the British BBC warmed up the assertion in its Panorama television programme that the supernote was made in North Korea and that its distribution was supported by secret Russian agents of the former KGB. The television film specifically dealt with a large batch of supernotes brought to Western Europe by a radical wing of the underground Irish Republican Army. Named as a person possibly involved was Sean Garland, president of the Irish Workers’ Party. Apart from British and U.S. agents, a high-ranking defector from North Korea was trotted out as the star witness for supposedly having worked on the counterfeiting of the money
in North Korea. However, the case described by Panorama had unfolded some years ago; it had long since been settled before British courts. And Panorama did not report that this was not the only IRA shipment of supernotes to be exposed. The Germans and Dutch had observed or intercepted such consignments several times, and they continually informed the British and the American authorities — who blocked further investigations by their colleagues from the continent. It was not until late autumn of 2005 that, according to media reports, the US government formally accused North Korea of printing the supernotes and brought charges against Garland.

The longer Europe’s anti-counterfeiting experts delve into this superdollar counterfeiting, the more riddles they churn up. This begins with the print quality of the supernote. Experts regard it as simply superb. In certain ways the supernotes are even better than the authentic 100-dollar bills of the Bureau of Engraving and Printing. Under the microscope, for example, the supernote shows an especially fine execution of line on the facing side, which cannot even be found on the real note. The complicated seal of the Department of the Treasury of the facing side is copied with absolute perfection, but just below it, one finds in the banknote numbering a marking compound that should not be there.

And then, missing from this excellently copied supernote, of all things, are the magnetic and infrared security features that would prevent banknote examining systems from bouncing it. Every surveillance device of an American bank or the Fed recognises the supernote immediately as counterfeit and spits it out. Do the counterfeiters perhaps intend that the supernote be recognised immediately in the United States?

Further, why would they have chosen the 100-dollar note if they really wanted to carry out economic warfare against the United States? True, every year the Fed has between 600 million and 850 million 100-dollar notes printined. But they are earmarked mostly for foreign countries. For example, the Fed itself assumes that all the newly issued 100-dollar notes in California soon leave the country. The 20-dollar and 50-dollar notes are much more popular in the States because amounts in the range of 100 dollars are usually paid with a credit card.

And, to round out the list of open questions: experts on printing machinery have grave doubts that North Koreans could have printed the supernote at all with their antiquated DLR Giori machinery. With that machinery, experts say, they could never have prined the 100-dollar bills issued starting in 1996. North Korea is even having difficulties with the printing of its own notes, as the miserable quality shows. But precisely 100-dollar bills of the post-1996 series keep turning up in supernote quality.

So-called clearing houses serve as intermediaries in international trading in banknotes. One of the largest can be found in Zurich. Banknotes worth the equivalent of 5 billion dollars are delivered here every day. Huge volumes of notes, often stacked on palettes, are checked for their authenticity with high-precision banknote examining machines from Giesecke & Devrient and then shipped out again. Such clearing points allow an unusually deep insight into the secret world of the international flow of banknotes. Thus, one notices that the supernotes always turn up in small, well-measured quantities, as though their volume were controlled. The only exception is the period of the fasting month, Ramadan, and the traveling of the Pilgrims to Mecca. Then the number of supernotes climbs noticeably. Normal gangs of counterfeiters do not behave like that. They want to unload their hot goods as quickly as possible. Further, experts believe they have determined that the supernotes regularly crop up in those regions in which US foreign policy is just encoutering problems: the Near and Middle East, certain African countries, and especially East Africa. Active in these places are opposition politicians, rebelling tribes, and private armies of the diverse warlords doing the bidding of the CIA. Could it be that they are being paid for their services in counterfeit dollar notes? It would not be the first case of this nature in history. Have thse groups perhaps used the money to buy weapons in East Germany and, after the Wall in Berlin had come down, in North Korea? Is this counterfeit money then making its way back from North Korea to the West, preferably to Western Europe? The Secret Service is keeping mum and official inquiries routinely go unanswered.

… It is not clear how much the US Secret Service knows itself, or how much it is allowed to know. In its search for the masterminds of this mysterious counterfeiting affair, perhaps the Secret Service ought to take a look just north of Washington DC. There, it is said, the CIA has a printing plant in which there are precisely the same modern DLR Giori machines installed that are used for printing banknotes. In this top-secret printing plant, of course, only passports and IDs are forged, it is said.

Whatever might be behind the supernote, the Bureau of Engraving and Printing finally seized the occasion of the general excitement to issue new dollar notes. Wtihin just four years, an unusual rush, it produced two new dollar series: the 1992 and 1996. This was the first change in the appearance of the greenback since 1928! Ony the second series however can be considered a real overhaul and improvement in technical security. The Bureau decided to do that after the issuance of the first new notes in 1992 because the number of phony dollar bills being detected had leaped again…

At the end of 2003, the Bureau of Printing and Engraving again began issuing a new dollar series, the third in ten years. The new 20-dollar bill was put in circulation first, followed a year later by a new 50-dollar bill. The Bureau also showed its colours then. For the first time in the history of the US dollar, the Fed resorted to the printing of a colored background, albeit in a demonstrativiely muted colouration. Congress, which has the ultimate say, and the Fed, which is charged with designing the notes, were not ready to add more colour. They feared that citizens would be made even more insecure by abrupt changes in the appearance of the dollar. Yet the new 20 and 50-dollar bills are already diligently counterfeited just as were all the 100-dollar notes put into circulation since 1992. Copies exist of all the new 100-dollar series without exception, in supernote quality. Experts have made bets on how long it will take before the 100-dollar note of the new series slated for 2006 also comes out as a supernote.