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The Treasury Department, the Federal Reserve Board and the U.S. Secret Service issued their third collaborative report today on the use and counterfeiting of U.S. currency abroad. The report revealed that while more than half of circulated U.S. banknotes are held in other countries, counterfeiting incidents remain low.
"People all over the world look to American currency for safety and security," said U.S. Treasurer Anna Escobedo Cabral. "I am pleased to learn that while counterfeiters may try to undermine the integrity of our money, American vigilance has upheld its reliability."
"An efficient payment system and healthy economy require a sound currency," said Federal Reserve Vice Chairman Donald L. Kohn. "The Federal Reserve recognizes that the dollar is widely used outside the United States, and is deeply committed to preserving its integrity."
"U.S. currency is recognized as a symbol of stability and integrity around the world," said Michael Merritt, Deputy Assistant Director, U.S. Secret Service. "Thanks in great measure to a three-pronged strategy of public education, aggressive enforcement, and regular currency redesigns, counterfeiting of U.S. currency has remained at consistently low levels."
Residents of countries with unpredictable political and economic conditions have used U.S. currency as a means of reliability for decades. The report estimated that about $450 billion of the $760 billion in circulation as of December 2005 is held abroad.
The international popularity of U.S. currency makes it an obvious target for counterfeiters. But the report estimates that of U.S. notes in circulation abroad and at home, only about one note in 10,000 is counterfeit.
The report attributes this low level of incidents to extensive U.S. data gathering, education efforts, law enforcement and communications with banks around the world. Additionally, the introduction of the new currency design starting in 1996 and related educational outreach around the world made counterfeit detection easier.
The study reaches five major conclusions about the counterfeiting of U.S. currency:
- The average incidence of counterfeit U.S. currency passing is generally low both inside and outside the United States, notwithstanding occasional large seizures of uncirculated counterfeits.
- Foreign banks and law enforcement agencies are eager to develop links with the U.S. Secret Service to detect and suppress counterfeiting activity.
- The interagency counterfeiting group has strengthened working relationships between the Secret Service and foreign financial and law enforcement organizations, which allowed for improved investigations and training.
- When counterfeit notes are found overseas, procedures invoked within each country vary widely. A lack of legal authority for banks and cash handlers to confiscate suspected or actual counterfeit U.S. currency increases concern about counterfeiting and hampers enforcement.
- The Secret Service U.S. Dollars Counterfeit Note Search website established in 1999, www.usdollars.usss.gov, has been extremely effective in aiding banks and cash handlers, their customers, and law enforcement in tracking and identifying counterfeit notes.
This study is the last in a series of reports and provides updates to the first reports issued in 2000 and 2003. Much of the information presented in the earlier reports remains valid today.
Treasury, Jennifer Zuccarelli (202) 622-8657
Federal Reserve, Susan Stawick (202) 452-2955
Secret Service, Eric Zahren (202) 406-5708