|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-| |-| |-| |-| Information on Counterfeiting |-| |-| |-| |-| Written by Michael Skoler Typed by Lone Wolf |-| |-| for the Science Supplement for fun while listening to |-| |-| of How it Works Encyclopedia Bob Marley and the Wailers |-| |-| |-| |-| Edited by Count Lazlo Nibble |-| |-| for format, spelling, and |-| |-| Countlegger 10 while listening |-| |-| to Frankie Goes To Hollywood |-| |-| |-| |-| 10/5/86 |-| |-| |-| |-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-| It's 8 pm. A junior executive walks through the offices of a New York advertising agency to make sure he's alone and then heads for the new laser copier. He's behind on his alimony and mortgage payments. He pulls out his wallet, extracts five $20 bills, and carefully places them on the copier's glass plate. He puches 10 on the quantity selector, pushes the button for Double-sided copying, and starts the machine. When it finishes he gathers up his 20's and the copies, and heads home to snip out a near perfect $1,000. New Photocopiers Have Amazing Capabilities ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ That prospect haunts Joe Carlon, head of the counterfeit deterrence for the US Secret Service . Those who have seen only the slightly fuzzy, off-color photocopies made on today's color copiers think he's unduly alarmed. But Carlon has seen copies from a new machine, the harbinger of a coming generation of copiers that can turn out currency far too close to the original thing. It's called the Quick Response Multicolor Printer, or QRMP, and it sits behind closed and locked doors at the Pasadena, CA headquarters of Xerox Special Information Systems. The US Department of Defense paid for its development in high speed mapmaking, and only those wih Top Secret clearance have seen it. The QRMP uses lasers to produce sharp images and, it's claimed, can reproduce any color in the spectrum. An internal computer ensures that the colors are true. The QRMP in Pasadena is just a prototype. But machines like it, made by Xerox and other manufacturers, should be in thousands of offices in the next few years . Since 1978 the US Treasury department has been nervously eyeing advances in photocopying. Its agents have been visiting the big copier manufacturers to look at their experimental models, and what they've seen leads to an inescapable conclusion: good counterfeits could soon be coming out of these highly sophisticated office machines. Making Fake Bills Becomes Even Easier ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ It's not just professional counterfeiters who worry the government. It's executives with bills to pay, clerks short on cash for a date, secrataries complaining about being underpaid. The new copiers could turn counterfeiting from an operation requiring skill and planning into a Impulse crime . "The ability to stick a bill into a copier and have a perfect copy come out creates an almost impossible enforcement enviroment," says Carlon. His agents believe they know of all counterfeits being made, and -- up to now -- have intercepted 90 percent of them before they hit the streets. And copiers are just the beginning. Soon high-technology manufacturers will be producing fast color printers and document scanners to go with today's color monitors and computer graphics programs. With a document scanner that can 'read' a picture and 'draw' a copy into a computer memory, a hacker could simply scan a bill and print it out. Major Effort to Deter Money-Makers ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ But the US Government has been quietly preparing to thwart this presumptive breed of counterfeiter. At the Bureau of Engraving and Printing in Washington, DC, anti-counterfeiting experts are redesigning all US Currency from the $1 bill to the $100. On the drawing boards have been watermarks, Security Threads, with printing that can't be seen when bills are laid flat, special color tints, holograms, and razor ting prisms that create changing color patterns. The Treasury Department plans to begin circulating new bills with at least some of these features in mid-1987. Until now, counterfeiting has been a big business -- for example, in 1984 an estimated $88 million in bogus bills was printed in the US -- usually requiring careful organization and considerable capital investment: Printing presses, special cameras, a distribution network. All that leaves a trail the Secret Service can follow. Its hardest cases involve small-time money-makers who only print a few bills at a time. One celebrated counterfeiter, Emmanuel Ninger, an immigrant Dutch sign painter known as Jim the Penman, passed bills for 14 years, from 1882 to 1896, before being caught. He created his $50 and $100 notes with pen, ink, and a camel's hair brush, and passed about 5 a month in New York City. He probably would have gotten away with it if a bartender hadn't noticed the ink on his fingers after picking a note up. But lone-wolf counterfeiters like Ninger have been the exception. How Real and Bogus Money is Made ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ US currency is engraved, like fancy wedding invitations. The process starts with dies for various elements in a bill, most of them hand cut by engravers decades ago. (A new element, like a Treasurer's, name is freshly engraved.) The parts are assembled into a master die of an entire bill, which is used to create a master plate of 32 bill engravings. This, in turn, is used to make curved nickel plates for the rotary presses. The presses spread a thick ink onto the plate and then wipe the surface clear, leaving the ink only in the engraved grooves. Paper is pressed onto the plate with 2,720 kg (6000 lbs) of pressure, forcing it into the grooves. The trapped ink sticks to the paper forming a raised ridge. If you scratch a bill, you can feel the ridges. Most of today's counterfeiters use offset printing -- the system employed to publish books. A bill is photographed, one color at a time through tinted filters. The image on each negative is burned with a high intensity lamp into a light-sensitive printing plate, inked, and transferred to rubber-covered rollers that print it on paper -- again, one color at a time. A dollar is green and black, and therefore much easier to reproduce than, say, a picture in a book or magazine which contains hundreds of hues. Yet, of the nearly $7 million of bad money actually passed in 1984, only $1 million was good enough to fool bank tellers. Offset counterfeits are never as sharp as the originals. They also feel wrong. Offset ink soaks into the paper, whereas the print on a genuine bill is raised. These flaws quickly attract the attention of cashiers and tellers, who are on the lookout for phonies. "Tht old saying is true," says Jon Desmond, former manager of Research and Development at the Bureau of Engraving and Printing, "if the money looks bad, it is bad." Rise in Impulse Counterfeiting Expected ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ But the new color copiers could make bad money look good. If a copy isn't convincing enough, some machines will be able to edit it, redrawing lines, adjusting colors, and, as an extra added attraction, changing serial numbers. And thousands of people will be able to use the machines. According to a goverment funded study done by the Columbus, Ohio, laboratories of the Battell Memorial Institute, an independent research organization, as many as 2000 offices will have the copiers by 1987, 5000 by 1992 . Copier manufacturers project even higher sales. The Battelle study predicts that one out of five people with access to the new machines will make and pass a few bills just to see if it can be done. One out of 100 will make at least a dozen bills to pay debts or take revenge on someone who has cheated him. One in 5000 might try to join the pros. "The total number of counterfeit notes would double from 1982 to 1987," says Joseph Sheldrick of Battelle, "and double again between 1987 and 1992". Color Copied Down to the Finest Detail ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Unlike the present copier, which uses mechanical means to create a duplicate, the new machine is really a computer . Its laser scanner reads and image and breaks it into tiny elements called pixels. The copiers program determines the precise mix of primary colors, contrast, and brightness that produces each pixel. To print, the copier pulses a laser beam across a light sensitive drum, drawing an electrically charged image on it, pixel by pixel. Dry inks called toners -- red, yellow, blue, and black -- are then dusted over the drum and stick wherever there's a charge. A sheet of paper rolls past the drum, picking up its pattern of toners. Mixed in the right proportions, the primary colors create any tint. To mix the colors and set the picture, the copier melts the layers of toner and applies pressure. The real advantage, and menace of the new machines is their ability to resolve extremely small points of color using their laser scanners and electric coding. The copier can even reproduce minute red and blue silk threads embedded in a US bill as a counterfeit detterent. And the raised print on copies, created by fusing the toner, gives bills the proper feel -- although experts say toner feels slippery compared to engraving ink. Security Threads Successful to a Point ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ In 1979 Carlon and other Treasury officials went to Xerox, bills in hand, to test an early version of the QRMP. "I think it's fair to say that they were startled at how good the copier was," says Paul Jacobs, the cheif scientist for Xerox Special Information Systems. The visit strengthened Treasury's resolve to foil the new copiers and other high-technology counterfeiting with changes in the bills. Most foreign governments changed their currencies in the 1970's as offset printing improved. Intracate designs and more colors exposed the weaknesses of offset printing -- its sometimes poor resolution of fine lines and inaccurate color reproduction. But the new copiers won't suffer from these deficiencies. So US attention turned to another device -- the security thread. Security threads -- usually thins stips of plastic, either with printing on them or, like recording tape, coated with metal -- are put inside a currency's paper as it is made. Mexico adopted this device for bills of large denomination. When one of these bills is lying flat, the thread appears as a faint grey line. But if it is held up to a light and examined closely, the miniscule black printing on the translucent thread can be seen. The print carries jumbled variations of BANXICO (for Banco de Mexico), as well as the bill's denomination (for example, MIL PESOS). Britain has also used hidden threads, but is now putting a metal coated thread on the surface of its 20 pound notes so it will shine when a bill is lying flat. A copying machine -- even one of the new ones -- would print the silvery thread as a dull black. Security threads work only if a person looks for them. "But they're just interested in the value of the paper, so they look for the one, the five, the hundred -- and they're happy," says Desmond. He points out that some counterfeiters do quite well by merely 'upgrading' one dollar bills -- pasting 100's, snipped from genuine $100 bills, over the 1's. Victims accept the money without even noticing that George Washington's face, not Ben Franklin's, is on the bill. Holograms Nearly Impossible to Copy Exactly ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ What the Treasure wants is a "magic element, something that will pop up and tell everyone 'I'm genuine,'" says Anthony LaCapria, vice president for research of the American Bank Note Company -- "something you don't have to examine. You'll know it's genuine just by a quick look." The company prints stock, bonds, and more than 70 different currencies. Its magic element is a hologram. These three-dimensional (3-d) color pictures are easy to spot: they seem project out of the paper. By tilting them from side to side you can see both the left and right sides of the picured object as if you were walking around it. American Bank Note has already put holograms on Mastercard and Visa credit cards, military documents, and foreign passports. Now the Treasury has asked it to test plastic holograms as thin as gold leaf, hot-pressed onto US currency. According to LaCapria, the 3-d pattern in the plastic, formed by microscopic pits and bumps are virtually impossible to copy exactly, and any attempt to do so would cost hundreds of thousands of dollars in equipment and research. Yet because of economics of scale, holograms would cost the goverment only a fraction of a cent per bill. And not even the most advanced copiers could reproduce the shifting images that they would provide. Authenticity Assured with Diffraction Grating ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Jacobs and his team of scientists at Xeros beleive they have an even better trademark that the Treasury could build into its bills: a set of parallel plastic Ridges called a diffraction grating. The ridges are so tightly packed that many thousands are in an inch -- that they look like a smooth surface. The distance between two of these approaches the wavelength of visible light, which gives diffraction gratings the ability to break white light into its spectrum. Held flat the grating may look red, while a slight tilt will turn it to a yellow or a green. "When you tilt it," explains Jacobs, "you tilt another color into your eye". A grating works because light bounces off its jagged peaks and collides with other light waves, just as waves hitting a rocky coastline bounce off and interfere with incoming waves. These collisions create an interference pattern in which some wavelengths, or colors, are amplified and others are canceled out. To create an image with a diffraction grating, the Xerox team produces different interference patterns, varying the spacing between the ridges. It's like starting with a painted canvas and erasing portions of it until a pattern emerges. Xerox's design contains color stripes with a number showing the bill's value in the center. The colors change, some slowly, some more quickly, as you tilt the bill. The grating looks like a thin plastic ribbon, and, because it's woven into he paper, only small strips of it are visible on the surface as it snakes in and out of the bill. New Features must Withstand Abuse ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Either gratings or holograms would forestall counterfeiting for many years to come, but the Treasury wonders if either could endure the abuse bills encounter. Dollars go through the washing machine, people go swimming with a couple of bucks in their bathing suits, mechanics grab bills with greasy hands, people even use them as fine sandpaper," says Robert Charles, senior vice president for sales at American Bank Note. "Holograms need to withstand all that. We're testing them on machines that fold and twist money. We put bills in ovens, wash them hundreds of times, and expose them to everything from chlorine to gasoline." Xerox is doing the same with diffraction gratings. Currency Changes Meet with Protest ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The Treasury Department was secretive about the plans for the new bills until March 1986, when -- following $31 million in research (done in conjunction with the Federal Reserve Board) -- officials revealed the first substantial change in US paper money since 1929. The bills to be introduced in 1987 will have two important features: security threads and the addition of tiny letters around the portraits. The letters will be too small to be copied by the machines but will be readable by someone using a 7x magnifying glass. (Among the techniques still under consideration for the future are holograms.) Even before the March announcement, some people were protesting any change. The House committee on Consumer Affairs and Coinage, which oversees the currency, has been swamped with angry letters. Some correspondents fear the new bills will be the first step toward tighter goverment control of currency. According to a subcommittee staff member, "The paranoids of the world are afraid that a metallic security thread in bills would allow authorities to drive down the street with detectors and locate people who have large sums of cash stashed away." Former Republican Congressman Ron Paul of Texas, a member of the subcommittee until 1984, warns that the government might use the currency change to devalue the dollar, and raises even darker specters: runaway inflation, international dollar panic, and Gestapo-like Internal Revenue Service (IRS) agents watching as people trade in old money for new. In fact, Treasury officials insist, the new bills will move into circulation gradually as old bills are withdrawn. And in any case, all former US currency is still legal tender. The Alternative to changing the currency, say defenders of the move, is itself frightening. Without a redesign of the dollar, the new color copiers could make counterfeiting a national pastime. "When we went off the gold standard and money could not be exchanged for gold, the only thing left was confidence," says Jacobs. "When John Q. Citizen isn't sure that everything in his wallet is real, the whole sytem is in big trouble." ------------------------------------------------------------------------------- Call these... Club Zero 213/395-0221 Remote's Hideout 818/999-3680 BWE100 612/544-3980 FutureScape 213/204-0357 Cap. Connection 916/448-3402 Rock'n Roll Harbor 305/821-ACDC (2232) Terrapin Station 505/865-0883