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Counterfeit Detection: Cummins Allison Explains How the Right Technology Can Protect Your Financial Institution

February 23, 2016, Mt. Prospect, IL – Cash is still a vital method of payment, used in about 40 percent of all retail transactions.1 Unfortunately, even with increased security measures and currency redesigns, the risk of taking in counterfeit bills remains high. According to recent data, U.S. authorities recovered approximately $89 million in counterfeit money from circulation; and the U.S. Secret Service estimates that $2.5 billion of bills in circulation are fake.2

It’s become even more critical for financial institutions (FIs) to arm themselves with the technology they need to protect their organizations and reputations. Cummins Allison, the leading innovator and provider of coin, currency and check handling solutions, as well as ATMs, highlights how investment in advanced currency processing technology can protect your FI from counterfeit losses.

All it Takes is Once

For counterfeiters to be successful, their work is relatively simple: they only need to pass a counterfeit bill once. When the unknowing individual or company accepts the counterfeit cash, it is either passed along through another transaction or deposited at an FI.

Financial institutions have a more daunting task: they must detect counterfeit bills every time, or risk fines and losses. If a counterfeit bill is passed to another FI and is detected by a Federal Reserve Bank, the depositing institution will lose the value of the bill, and will also be fined. And since the majority of counterfeits are $50s and $100s, the financial losses can become quite significant.

In addition to fines from the Federal Reserve, FIs also can’t afford to pass counterfeits back to clientele. Poor counterfeit detection on money going into the branch could result in counterfeits going out. Whether it’s from a teller drawer or through an ATM, financial institutions need to guarantee that they aren’t passing counterfeits back into circulation.

Reducing Risk with Currency Processing Technology

While counterfeiting will never be completely eliminated, organizations can leverage technology to proactively safeguard their institution. For decades, currency handling and processing machines have been valuable tools for financial institutions and the commercial industries they serve. Now this same equipment can be used to minimize the risk of counterfeiting.

Today’s most advanced systems incorporate innovative technologies to detect counterfeit currency, including:

  • Scan sensors: Identify the true value of bills with clipped corners to flag and challenge potential counterfeits

  • Magnetic sensors:Compare magnetic ink levels on the currency with preset benchmarks for each denomination.

  • Fluorescence sensors: Test the paper of each bill, stopping the process when a bill fluoresces differently than legitimate currency should.

  • Enhanced ultraviolet:Ultraviolet (UV) sensing to validate paper authenticity.

  • Infrared sensors:Infrared (IR) sensors detect the printing quality of each bill.

  • Advanced analytic software: Works in tandem with sensors to detect counterfeit notes.

  • Serial number tracking: Read, record and retain serial numbers for future retrieval

As long as currency is circulated, there will be counterfeiters trying to pass fake bills. Currency scanning equipment with the most advanced form of counterfeit detection is essential for FIs to safeguard against counterfeit risks.

To learn more about Cummins Allison’s line of cost-effective counterfeit detection enabled currency processing machines, click here.

 

Sources:

1 Even in a Digital Age, Cash Remains King; Federal Reserve Bank of Atlanta, Second Quarter 2014; https://www.frbatlanta.org/banking/publications/financial-update/2014/q2/cash-remains-king-in-digital-age.aspx

2 Counterfeit Money: Keeping a Step Ahead of Criminals; Sophic Capital, January 7, 2015; http://sophiccapital.com/wp-content/uploads/2015/01/Download-Full-Counterfeit-Money-Report-Here.pdf

 

About Cummins Allison

Cummins Allison is the leading innovator and provider of check, currency and coin handling solutions, as well as full-function ATMs. Our world-class sales and service network includes hundreds of local representatives in more than 50 offices in North America, 6 wholly-owned subsidiaries and is represented in more than 70 countries around the world. For more information about our award-winning solutions, visit www.cumminsallison.com.