24th October 1999

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Take a note of that note

Counterfeiting has become a high-tech racket using personal computers

By Udena .R Attygalle

Take a note of that noteThe art of the counterfeiter, till recently a painstakingly hard one dependent on offset printing presses has now gone high-tech.

In 1997, 19 per cent of all counterfeit currency seized in the US was computer generated, using colour ink jet printers. The classic movie cliche of the ink-stained master engraver painstakingly touching up his printing plates is definitely out of style. Today the personal computer is the main tool of the counterfeiter.

Recent discoveries of hordes of forged money show that this new trend has come to Sri Lanka. Computer generated forged currency was first discovered here in 1997.

Valid Sri Lankan currency is printed by the French company, Thomas De La Rue and Company at their Sri Lanka branch at Biyagama. Coins are minted at the Royal Mint in the UK or sometimes at the Royal Canadian Mint. "The notes are printed on the orders of the Central Bank, which stipulates the amount needed using inflation, the amount of unserviceable currency and growth rate as forecast guidelines," M.R. Fernando, the Superintendent of the Currency Department of the Central Bank said.

A host of security measures are imprinted to make it virtually impossible for counterfeiters to reproduce valid currency issued by the Central Bank. Additional Superintendent Chithra Ariyarathne explained that most of the forged notes are either Rs 1000 or Rs 500. Forging lesser denominations is just not worth the trouble, she pointed out.

Although the common feeling among the public is that there are many counterfeit notes in circulation, Mr Fernando says the number is almost negligible and the bad notes themselves are easily identifiable. He pointed out that in 1999 the number of forged Rs. 1000 notes collected by the Central Bank was less than 50 and the number of Rs 500 notes less than 30. Although a large number of counterfeit currency notes are printed, being easily identifiable, assures that they do not make it into circulation.

The security features incorporated in the notes are two fold: ones that are visible to the naked eye and others that are machine readable.

The machine readable features include a thin line of micro printing "Central Bank of Ceylon" text above the 'Sri Lanka Maha Benkuwa' block on the top of the faceside of the note and below the design just above it (this is visible through a magnifying glass).

Senior Assistant Superintendent of Currency K.Gunethilaka demonstrated how various areas such as the denomination of the note glow when held to an ultraviolet light. "These machines are available at most branches of commercial banks," Mr. Gunethilake said. The forged notes meanwhile glow uniformly just like ordinary paper under UV light. The latent image, another feature is at the bottom of the note in the middle part. Slanting the note to a side will show the hidden numerical denomination. Features like these are virtually impossible to reproduce and would not be worth the effort in any case.

The number on the note identifies the series it belong to. For instance the most recent Rs 1000 notes belongs to the G series.

The special branch at the CID, the Counterfeit Currency Bureau, has so far had 10 cases of computer generated fraud currency. IP Kamal Perera, the OIC says, there are at present four organized groups involved in counterfeiting. They usually comprise computer proficient people like computer graduates, sometimes even computer teachers. He explained that 'usually the currency is passed into circulation through a series of dealers.'

For example, if Rs 100,000 is printed, then the first dealer pays the printer Rs 50,000 in genuine money for the forged, and so on. The notes themselves are distributed mainly in rural paddy cultivating areas like Dehiyaththekandiya, Hanguranketha and Galenbidunuwewa. The money is spent in small amounts; for instance at the local bar or boutique.

IP Perera recalled that the recent bust in Kandy had revealed a huge organisation with an all-island distribution set-up. Nearly Rs 10 lakhs had been printed of which around Rs two lakhs had been recovered by the CID. "Most of the money that made it into circulation was probably destroyed by the public themselves once they discovered that the notes were not authentic," IP Perera added.

Six cases have so far been reported this year. The Bureau has also detected two more varieties of counterfeit notes indicating that two more computer gangs are producing fake money. Information regarding counterfeit currency can be given to the Bureau on 326670 .

The process of printing itself is mostly a combination of scanning and producing a colour printout. No special software is required. The forged notes unlike the genuine, are actually two pieces of paper pasted together .

Director of the Computer and Information Technology Council of Sri Lanka (CINTEC) Ajith Ekanayake says, "Small and unclear characters usually do not show up in a scanned reproduction. Getting the two sides of a currency onto one piece of paper is also difficult, although not impossible."

The Customs Department says that importing of colour photocopiers into Sri Lanka is not allowed because of its potential as a counterfeit tool. Yet there are no regulations against importing colour laser printers or scanners.

Meanwhile Mr. Fernando, the Superintendent of Currency pointed out that there was a probability that "even rich kids with all the computer facilities might be indulging in forgery mainly to see if it's actually possible." This money may then be passed on at places like night clubs, he surmised. .

According to IP Kamal Perera attempting to use counterfeit currency can carry a fine of Rs 1500 and printing counterfeits can carry a sentence of seven years rigorous imprisonment.

What's genuine?

Senior Assistant Superintendent of Currency K. Gunethilaka explained the visible features of a genuine Rs 1000 rupee note .

*A silver thread (stardust thread) runs through the right side of the note. This thread is interwoven into the note, showing above the surface intermittently. The stardust on a counterfeit is actually a silver paint, that comes off .

*The watermark (a lion holding aloft a sword or prior to 1986 a whip on a genuine note has a three dimensional effect. The sword is also highlighted and is of a different shade to the rest of the water mark. In a forged note, the watermark may be missing or is a crude one clearly different to the intricate genuine one.

* The paper used for genuine notes is a cotton pulp (made at Portals London), of high quality. The new Rs 200 note is made of polymer type paper. Counterfeit notes are of normal commercial paper

* Intaglio printing is used in genuine notes. That gives an emboss effect and the characters can be felt by hand. Forged notes do not have this.

* Two identical shapes are super-imposed on each other on either side of the note with an object in the middle of the shape on one side of the note. This object will have a see-through effect and show in the middle of the shape on the other side of the note. In fake notes the middle object will not be exactly in the centre .

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