Paper Money

Rare £1,000,000 Bank of England Treasury note is in sale

A very rare £1,000,000 Treasury bill dating from September 2003 that was never issued will be offered for sale in an online/live auction of British, Irish and world bank notes.

The auction will be conducted by London’s Dix Noonan Webb on June 24 on its website, Physical distancing regulations preclude physical viewing, but all lots in the sale can be examined on the website.

The bill, one of the last printed, is on fully watermarked paper, with the signature of Andrew Turnbull, and stamp canceled. It is estimated to bring from £5,000 to £7,000 ($6,250 to $8,750). DNW is donating five percent of all buyers’ fees to the NHS Charities Together Covid-19 Appeal.

DNW’s Andrew Pattison explained the story behind the unusual bill: “Until just over a decade ago, notes such as these were issued every week in the City under a secretive system which enabled the British Government to manage its short term borrowing policy and make sure that sufficient funds were always available to meet any net daily cash shortfall. Financial institutions tendered for Treasury Bills every Friday, specifying that they wanted the Bills on a particular day the following week.” The bills were physically collected from the Bank of England for delivery by messengers.

The bills had maturities of from one to six months. Buyers bought them at a discount from the government and made their profit when they sold them back to the Bank of England at maturity for the full face value. They were also freely traded, since if the payee line was not filled in, they were payable to the bearer.

This is one of the last bills printed, as the system would soon go electronic. When the changeover was made, any bills left over were canceled. Some were given away as gifts when staff returned or left the company. These account for the few very rare examples now on the market.

These Treasury bills were the subject of the second largest robbery in world history, DNW says, exceeded only by the $1 billion stolen from the Central Bank of Iraq by one of Saddam Hussein’s sons in 2003. On May 2, 1990, John Goddard, a 58-year-old messenger working for the money brokers Sheppards, was mugged at knife point, allegedly by Patrick Thomas, a petty criminal from south London, on a side street in the City of London. He got away with 301 Treasury bills and certificates of deposit worth a total of £292 million.

The City of London Police and the FBI infiltrated the gang involved in laundering the bills and eventually recovered all but two of them. One man was jailed for his role in the crime, but Thomas was found dead from a gunshot wound to the head before he could be charged.

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