Counterfeiting through the ages  Share

Forgers, engraving in J. De Damhoudere, Practycke in criminele saken, 1555

Forgers, engraving in J. De Damhoudere, Practycke in criminele saken, 1555

Counterfeiting – an umbrella term covering not only the production of fake coins but also the forging of banknotes and other means of payment – is a perennial fact of life. Even in the days before coins came into use, people were faking the current means of payment; and shortly after the first coins were produced in the seventh century BC, the first forgeries also turned up. In some periods, counterfeiting took on epidemic proportions, often because the state had placed too few coins in circulation.

In the first century AD, for example, in the Roman Empire there were many unofficial coins in circulation, intended to compensate for the shortage of official currency. Another example of a period in which counterfeiting was widespread was the second half of the 19th century in the United States of America. At the start of the Civil War in 1861, it was estimated that roughly half of the banknotes in circulation were forgeries. This wholesale counterfeiting only came to an end when the government set up the secret service to combat large-scale fraud. By the end of the 19th century, this widespread counterfeiting in the United States had virtually disappeared.

The forgers trapped, engraving from a woodcut by R. Brend amour, in: De Belgische Illustratie, 1868

The forgers trapped, engraving from a woodcut by R. Brend amour, in: De Belgische Illustratie, 1868

Counterfeiters may be driven by divergent motives. A first – obvious – motive is greed, as counterfeiting banknotes can generate big profits in a short time, even more so than producing fake coins. A less obvious motive may be vanity. There are several known examples of forgers who specialised in producing fake antique coins for sale to coin collectors, and even minted fictitious coins to demonstrate their ability. Finally, a third motive may be political.

There are a number of known examples of rulers who, on grounds of financial necessity, ordered coins to be minted from base metal and passed them off as genuine gold or silver coins. A well-known example is Frederick the Great (° 1712 – 1786) who ordered coins to be minted with an excessively high copper content; owing to a trick of chemistry, the coins took on a fine, silvery appearance. A more malign political motive is the large-scale counterfeiting of means of payment by an enemy state with the aim of destabilisation. The best known examples are Nazi Germany’s ‘Andreas’ and ‘Bernhard’ operations. Both focused on large-scale counterfeiting of the British pound. Operation Andreas was designed to flood the British market with fake pounds in order to destroy confidence in the currency and trigger hyperinflation. In 1942 the plan was redesigned and changed its name to Operation ‘Bernhard’. The primary aim was no longer the destabilisation of Great Britain but the provision of extra financial resources for the German troops. Altogether, millions of banknotes were forged, of which around one million were of sufficiently high quality that they could barely be distinguished from genuine banknotes. Although many of the notes were not actually placed in circulation, it was estimated that in 1944 roughly one in twenty British banknotes was a forgery. On the European continent, this percentage may have been considerably higher because, ultimately, it was mainly there that the counterfeit pounds were circulated, for the purpose of buying gold, ordnance and food for the German troops. It was therefore mainly on the continent that confidence in sterling was undermined, to a far lesser extent than in Britain itself, although that had been the original intention.

Forced labour as the punishment for forgery on the Beyaert-type 100 Belgian franc banknote (1978-1996)

Forced labour as the punishment for forgery on the Beyaert-type 100 Belgian franc banknote (1978-1996)

As the last example shows, counterfeiting can wreak considerable damage. Not only at individual level – e.g. a trader who finds that he has been paid with worthless banknotes – but certainly also at macro-economic level. Large-scale counterfeiting undermines confidence in the national currency. For example, in 1888 a spate of forgeries in France caused such panic that the genuine banknotes had to be withdrawn. Counterfeiting of the means of payment has therefore always attracted severe punishment. In the Middle Ages, forgers could expect the death penalty: they were boiled alive or burnt at the stake. Although these severe penalties are definitely a thing of the past, the punishments for counterfeiting are still severe. The penalty for forging euro coins is five to ten years’ imprisonment, while those who counterfeit euro banknotes are jailed for fifteen to twenty years. Accomplices who help to place the forged coins or banknotes in circulation can also expect the same penalties. What many people do not know is that even those who have received counterfeit money themselves and try to pass it on are liable to be punished and risk a fine.

However, the European Central Bank, which coordinates the issue of euro banknotes, does not focus solely on severe penalties for counterfeiting, but also places heavy emphasis on prevention.

Leen Bultinck, 
Museumguide

Bibliography

  • Malkin L., La guerre des faux-monnayeurs. Le complot des faussaires nazis et les déportés du block 19, City Editions, Paris, 2007, p. 178.
  • Kauch P., “Les Faux-Monnayeurs”, in NBB-BNB personeelstijdschrift, 1960-1961.

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