Insights

When large got small: U.S. officials respond to paper money counterfeiting with wave of design changes in 1990s, 2000s

Overhaul began with modest changes to $100 Federal Reserve Note in 1991
By , Coin World
Published : 08/21/14
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Editor’s note: In her September monthly Coin World cover feature, Michele Orzano told the story of small-size notes and how they changed American paper money. This is one of a series of articles from this feature that will appear online at CoinWorld.com. 

Read other posts in the series:

The year 1929 introduced many changes to the American way of life. Perhaps the best known is the Great Depression, triggered by the Oct. 29, 1929, stock market collapse.

But another change occurred a few months before that and is still evident today for those who use or collect paper money. Small-size notes made their debut in the summer of 1929. The decision to downsize paper money and the immediate and long-term effects of the decision are interesting to explore.

Fighting back

On July 25, 1991, U.S. Treasury secretary Nicholas F. Brady and Federal Reserve Chairman Alan Greenspan unveiled the Series 1990 $100 Federal Reserve note, which featured a modest change to the existing design: a denominated, vertical, polyester security thread and microprinting around the vignette of Benjamin Franklin. The redesigned notes would enter circulation in August of 1991.

The new security features were the Treasury’s answer to an increase in the counterfeiting of $100 FRNs, which circulate around the globe.

A repeating microprinted message, UNITED STATES OF AMERICA, can be seen around Franklin’s portrait and appears as an additional line of ink, which can only be read when magnified. 

The security thread appears vertically to the left of the black Federal Reserve seal. The thread bears microprinting of USA 100 repeated along the length of the thread. The thread can be seen only when the note is held up to the light.

The $50, $20, $10 and $5 FRNs with anti-counterfeiting devices were produced over the next few years.  

But a second wave of increased anti-counterfeiting devices was soon to appear. Details about the second phase of paper money design changes during the 1990s were made public July 13, 1994, during a hearing before the House Banking, Finance and Urban Affairs Committee. 

The announced changes included “an enlarged off-center portrait on each denomination; a matching watermark; an enhanced security thread in a different location on each denomination; expanded use of microprinting in the design,” and other devices.

The new designs became a reality with the issuance of the Series 1996 $100 Federal Reserve note early in 1996. The 1996 release carried the most significant design changes to U.S. paper money in 67 years. 

As announced in 1994, the new notes also had a watermark portrait of Benjamin Franklin, and additional anti-counterfeiting features. The primary colors of the notes remain black and green. 

However, the Series 1996 $100 FRNs were the first to feature color-shifting ink, found on the numeral 100 in the lower right corner of the face. Other changes made to the note design were not aimed at preventing counterfeiting. 

That launch of the $100 note in 1996 was followed in 1997 with the release of the Series 1996 $50 note, the Series 1996 $20 FRN in 1998, and Series 1999 $10 and $5 FRNs in 2000. All of the notes were in the same design style as the Series 1996 $100 note. All denominations incorporated some, if not all, of the anti-counterfeiting features introduced on the Series 1996 $100 note. 

The addition of subtle, background colors in FRNs in 2004 was the next makeover for the small-size notes. The first of the color-added notes were the Series 2004 $20 FRNs, with shades of pastel green and peach ink in the background, which were released in October 2003. 

Following the release of colorized $20 FRNs, Series 2004 $50 FRNs, with blue and red background colors, were released in October 2004. In March 2006, redesigned Series 2004 $10 FRNs with splashes of yellow and orange were issued. The Series 2006 $5 FRNs, with light purple and gray, were issued in 2008. 

The redesign of the $5 FRNs was not in the master plan, but in 2005 Secret Service agents working with their counterparts in Colombia had discovered genuine $5 FRNs were being bleached and overprinted with designs from $100 FRNs.

In April 2010, the Federal Reserve Bank of New York in New York City was the site of an exhibit on counterfeiting. The exhibit was jointly organized by the American Numismatic Society and the Federal Reserve Bank with the cooperation of the U.S. Secret Service. 

One of the displays showed the machinery used to “bleach” ink from genuine $5 FRNs and to print $100 FRN designs on the genuine paper.  

Because of this, U.S. Treasury officials announced in June 2006 that the $5 FRN would undergo a redesign and upgrade of security features. Redesigned $5 FRNs were placed into circulation in March 2008. 

Government officials did not stop in their efforts to improve the anti-counterfeiting features of U.S. paper money, though the introduction of a new generation of notes would be delayed beyond their original release date.

More of Michele Orzano's story on small-size notes is on the way! Check back with CoinWorld.com for the latest, or better yet, let us tell you when a new post is up:

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