“For more than 200 years, counterfeiting has been a part of the wartime strategies of a number of countries.”
DURING THE 1990s, U.S. national security experts began tracking a new and rather unusual threat.
Some individual or group was purposely flooding the world’s economy with millions of phoney American $100 bills. The facsimiles, dubbed ‘superdollars’ because of their superior production quality, were printed with the highest quality inks on near perfect reproductions of the cotton/linen paper blend used in the manufacture of American greenbacks. They were even run on an intaglio press, just like the U.S. Mint’s own equipment. Even security features, like the embedded red and blue fibres and watermarks, were faithfully reproduced. The bills were virtually perfect.
Over the next 15 years, at least 19 superdollar variants were identified, with each new version improving on the design of the last. In one year alone, an estimated $25 million worth of the phoney notes were released annually into the global economy. Eventually, as many as one in every 10,000 American $100 bills was a superdollar. Investigators speculated that Russian or Chinese crime syndicates were responsible for the bogus currency. Others blamed North Korea.
Some with the intelligence community theorized that cash-strapped Pyongyang first hatched the scheme following the break-up of the Soviet Union in 1992. It did so with two possible objectives: to financially weaken the U.S. and to provide hard currency needed to shore up North Korea’s anemic economy. Washington even identified a suspected trafficker of the bogus bills. In 2005, British police arrested a 71-year-old former IRA activist named Sean Garland for allegedly collecting and distributing the superdollars from the North Korean embassy in Moscow. American officials fought unsuccessfully in 2011 to have Garland extradited to the U.S. to face charges for his suspected role in the scheme.
If North Korea really was behind the superdollars, it certainly wouldn’t be the first time a world power has used forged currency to damage an opponent. In fact, for more than 200 years, counterfeiting has been a part of the wartime strategies of a number of countries. According to one source, during the Seven Years War both the Austrian and Russian armies dispersed bogus Polish money while on campaign as a means to further weaken the enemy. It was a strategy revived by Napoleon when he wanted to undermine the economies of Austria, Russia and Great Britain.
Here are some other examples:
The King’s Shovers
When the British were looking for ways to hobble the fledgling American economy during the War of Independence, they turned to two Tory agents in America for help: David Farnsworth and John Blair. The pair travelled the 13 colonies dispersing wads of imitation Continental dollars into circulation.
At the time, the practice was called “shoving.” The British hoped that the forgeries would undermine colonists’ faith in the rebel currency thus disrupting Congress’ ability to fund the war and possibly even bring about a complete collapse of the American economy. Farnsworth and Blair were arrested by rebel agents with more than $10,000 of bogus bank notes in their possession. George Washington ordered them hanged.
Sam’s Southern Dollars
Samuel Upham made a fortune printing thousands of replica Confederate $5 bills during the American Civil War. But the Philadelphia-based writer and entrepreneur, known as “Honest Sam,” wasn’t a crook, nor was he trying to defeat the secessionists – his funny money was sold as a novelty. In fact, souvenir hunters and collectors could pick up his fake rebel fivers for one cent a piece. Upham was so proud of his forgeries, which were of far better quality than actual Confederate bills, he printed his name and address on them. Upham even advertised the dollars as “mementos of the rebellion” in Harper’s Weekly and The New York Tribune.
Ironically, some of his biggest customers were Southerners who secretly bought up whole sheets of the novelty scrip for use in transactions below the Mason Dixon Line. Soon Upham’s bills became ubiquitous throughout the Confederacy causing, according to one Southern senator, more damage to the rebellion than the entire Union army.  The Confederates even put a $10,000 bounty on Upham and threatened to hang all counterfeiters it caught. Amazingly, it was officials in Washington that finally forced Upham to cease and desist selling his bogus banknotes. The White House feared that if the rebels suspected that the forged currency was part of some grand Yankee strategy, the South might retaliate in kind, which would do harm to the national economy. Federal investigators even pondered charging Upham with a crime, but since Washington never recognized the government in Richmond, he hadn’t broken any law. Upham ended up printing stationery instead.
When it became clear to the Nazis that they weren’t going to break Britain on the battlefield, Berlin decided to try to destroy England’s economy instead with counterfeit currency. In 1942, a SS major named Bernhard Kruger conscripted 142 concentration camp inmates to forge £5, £10, £ 20 and £50 notes. It was hoped that the bills would shake the world’s confidence in the British treasury. From the start of the project, dubbed Operation Bernhard, to its conclusion April 1945, nearly 9 million bills were printed totalling more than £134 million.
The plan at first was to scatter the fake money over British cities using Luftwaffe bombers. Instead, the funds were passed through agents at international branches of British banks. Even German spies working abroad were paid using the phoney money. In 1945, plans were underway to expand the operation to include American $100 bills, but with the war coming to end, the scheme was suspended. As Allied troops began liberating concentration camps, Nazi officials ordered Bernhard’s forgers to be trucked to a more secure camp and then killed. Fortunately, the camp was liberated before the death sentences could be carried out. The Nazi bills continued to be circulated in the U.K. for years after the war. Large stockpiles stashed by concentration camp inmates even helped finance the migration of Jews to Palestine. Operation Bernhard was the subject of the 2007 Austrian film The Counterfeiters.
The United States and its Allies famously used counterfeit Iraqi money during the 1991 Gulf War, not to undermine Saddam’s economy, but to break the fighting spirit of his soldiers. Millions of propaganda leaflets printed in Arabic on the backs of replica Iraqi dinars were dropped by American planes throughout the region prior to and during the liberation of Kuwait. “Saddam lives in luxury while you and your family starve,” read one such note.
Others included ‘safe conduct’ passes that described the steps an Iraqi soldier should follow to safely surrender to Coalition personnel, as well as details on the food, water and medicine that waited for them if they called it quits. American planners opted to disguise the leaflets as money because loose bills on the ground are more likely to attract attention and be picked up. Furthermore, safe conduct passes disguised as money could be more easily hidden in a soldier’s wallet.
(ORIGINALLY PUBLISHED on APRIL, 15, 2013)