03 February 2003
Redesign Aims to Maintain Confidence in U.S. Currency
(New design to be unveiled in 2003, Under Secretary Fisher says)
The Treasury Department plans to introduce "significant changes" in
the appearance of the dollar at least every seven or eight years as
part of an intensified campaign to stop the counterfeiting of U.S.
notes, Under Secretary of the Treasury Peter Fisher says.
In a February 2 address to the Banknote 2003 Conference in Washington,
Fisher said that "continuous improvement" in design features --
coupled with strong law enforcement -- is the most effective defense
against counterfeit dollars.
"The overarching goal for U.S. currency design is to maintain
confidence in our notes, both at home and abroad," he said.
The dollar is widely used around the globe, with 60 percent of
circulating Federal Reserve notes held outside the United States,
according to Fisher. He said new technology has also made it easier
for counterfeiters around the world to make quality copies of U.S.
According to the Bush administration's budget proposal for 2004, U.S.
law enforcement officials discovered $47.5 million in counterfeit
money in 2002. Of the total, 39 percent was computer generated, up
from only 0.5 percent in 1995.
To combat the increasing sophistication of the tools available to
counterfeiters, Treasury has initiated "a process of continuous cycles
of design change" and will in 2003 unveil a new design for the dollar
that will, for the first time, include the use of a color other than
green, Fisher said.
The new design will be accompanied by an extensive public education
campaign both domestically and overseas, said Fisher, who noted that
security features work "only if the public knows about and uses them
to authenticate currency."
He said the education campaign would likely face a special challenge
in the United States, where the currency design introduced in 1928
lasted nearly 70 years and where residents have only recently had to
adapt to relatively minor changes in the physical appearance of the
The more dramatic redesign to be introduced in 2003 "will require
extensive foreign and domestic marketing campaigns to educate
consumers, banks and law enforcement officials," Fisher said.
Following is the text of his remarks as prepared for delivery:
U.S. Department of the Treasury
Office of Public Affairs
Remarks of Under Secretary of the Treasury for Domestic Finance Peter
Banknote 2003 Conference
February 2, 2003
The Objective for U.S. Currency Design is Continuous Improvement
The overarching goal for U.S. currency design is to maintain
confidence in our notes, both at home and abroad. To achieve this
goal, we want to apply continuous downward pressure on the penetration
of counterfeit notes. Our strategy to do this is continuous
improvement: continuous improvement in design features and in
aggressive law enforcement.
A constraint that we face as we introduce these improvements is
consumer acceptance. We must surmount the fact that our citizens here
in the United States have been accustomed to continuity in currency
design over many years and only recently have had to adapt to changes
in the physical appearance of our currency. However, we are now
beginning a process of continuous cycles of design change so that, at
a minimum, significant changes will be introduced every seven or eight
years. While this will require extensive foreign and domestic
marketing campaigns to educate consumers, banks and law enforcement
officials, continuous improvement is our most effective defense
The design of our notes must help maintain confidence in U.S. currency
as a stable and accepted medium of exchange and store of value around
the world. This goal demands our attention because use of the dollar
underpins our domestic economy and, due to its widespread foreign use,
the global economy as well. Of course, its use abroad offers
seignorage benefits to U.S. taxpayers.
We focus our efforts on the specific objective of continuous downward
pressure on counterfeiting. The cost of preventing counterfeiting is
minor compared with the risk of a loss of confidence in U.S. currency.
Today's confidence in the currency rests on a legacy of success in
suppressing counterfeiting based on fixed design features. In 1928,
the United States introduced a currency design that lasted nearly
seventy years. Its security was based on traditional features such as
high-quality distinctive rag paper and fine line intaglio printing. At
its start, the currency circulated almost exclusively within the
borders of the United States. Threats to its integrity originated
almost exclusively within our borders. Effective law and design
enforcement kept counterfeiting at bay and customer acceptance high.
The currency environment changed and our strategy had to evolve as
well. U.S. dollars are now used globally, with 60 percent of
circulating Federal Reserve notes held abroad. While our customer base
has grown worldwide, computer technology has transformed the nature of
methods used in counterfeiting.
In 1996, the United States introduced a major redesign of banknotes.
These design changes were needed to combat the emergence of color
copiers and other emerging technologies to replicate notes. The new
design incorporated a number of security features, and succeeded in
raising the difficulty of producing a high quality counterfeit note.
But as the quality and sophistication of printers has since improved,
so did the quality of the counterfeited notes.
Our strategy today is continuous improvement: continuous design
change, continuous development of security features, and continuous
cooperation with the digital imaging industry, foreign banks, and law
enforcement. Success will demand educating consumers to know and
accept these changes. This is a particular challenge for domestic use,
because Americans are not yet used to a shifting currency.
One example of the fruits of cooperation is the recent digital
counterfeit deterrence system introduced by the Central Bank
Counterfeit Deterrent Group. I applaud everyone involved in this
endeavor. You are building a record of achievement in our cooperation
with central banks and the private sector. As the word "continuous"
implies, this success is just the first step. While so many people
have helped us get this far, I would like, in particular, to thank and
recognize the efforts of Tom Ferguson, of the Bureau of Engraving and
Printing, Marsha Reidhill, at the Federal Reserve Board, Tony Chapa,
of the United States Secret Service, and John Moore, from the Federal
Reserve Bank of San Francisco.
We are also working with an international group of major banknote
producers to minimize the threat posed by digital devices and
computers. As a matter of policy, we do not identify individual firms,
but we thank you for your collaboration.
In 2003, we begin the roll-out of the next generation of currency. The
most dramatic change that you will notice is color. The color
symbolizes a more sophisticated note and captures attention. We know
from experience that security features are effective deterrents only
if the public knows about and uses them to authenticate currency. For
many years, Americans have taken our currency for granted. We have
tended not to notice its appearance and we have also been confident
that we won't receive counterfeit currency. In other areas of the
world, people's first instinct is to check a note before accepting it.
Foreign users of our currency are keenly aware of its features and
cash handling professionals are adept at detecting counterfeits.
With the advent of new reprographic technology, it is critical that we
educate our own citizens to look, feel and assess their currency
Introducing a new U.S. design will require us to educate people
worldwide to take greater cognizance of security features and the
importance of scrutinizing a note one receives. The introduction of
the 1996 series showed that an integrated worldwide public information
campaign can succeed in informing, educating and training the users of
U.S. currency about a redesign. We used a variety of media from
printed materials to public service announcements to paid advertising,
and we mobilized support including the United States Information
Agency and U.S. embassies around the globe. In the end, we achieved
the goal of extremely high awareness of the new currency.
It takes several years from a new design concept to issuance of
currency. We plan years ahead. As I mentioned, we now anticipate that
we will be introducing refinements in currency design at least every
seven to eight years. Also beyond design, there is the quality of
production. The United States is looking towards innovations such as
producing 50 subject sheets and acquiring more computer aided
How can the United States keep up with the pace of continuous
improvement? Our best bet is to find ways of spurring private sector
innovation. We need to provide avenues for the private sector to bring
new ideas into the industry and encourage them to participate in
developing anti-counterfeiting solutions. We must reach out beyond the
traditional players and welcome new ideas and technologies. A
partnership of government and industry is the only prudent way to
achieving our objective: continuous downward pressure on
counterfeiters' penetration rates through continuous improvement in
our currency's design.
Thank you for this opportunity to speak to you today as you begin your
conference on the essential mission of protecting of the world's
(Distributed by the Office of International Information Programs, U.S.
Department of State. Web site: http://usinfo.state.gov)
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