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ATMs dispense laughable phony cash

By Claes Bell, CFA · Bankrate.com
Thursday, October 11, 2012
Posted: 6 am ET

Next time you visit the ATM, you might want to take a closer look at the cash it dispenses. Last week, ATMs in New York owned by JPMorgan Chase & Co. and serviced by NCR were loaded with $110,000 in fake bills, some of which were dispensed to customers.

The funny part: The counterfeit bills were really, really bad. Printed on regular paper stock with images only on one side, they may have been created by a rogue employee specifically to fool ATMs.

While it wasn't true in this case, counterfeit cash can often be hard to spot. (photo by Eric Skiff)

While it wasn't true in this case, counterfeit cash can often be hard to spot. (photo by Eric Skiff)

From Joseph Goldstein and William K. Rashbaum at The New York Times:

The counterfeit bills did not appear intended to fool customers so much as to trick the ATMs into believing they were carrying a full complement of cash. However, in most instances, the machines appeared to have been able to distinguish the fake bills from the real ones, and separate them. A Chase bank official said that the canisters designed to snare bogus bills for this purpose in the ATMs were full of them.

But at least two of the counterfeit bills got through on Monday.

A customer at each of the two Chase branches alerted bank employees that they had received a fake bill, the bank official said. In one case, the customer had made a withdrawal for $20, while the other customer's withdrawal was for $100, the official said.

Both customers discovered the fake bill right away, the official said.

In a statement issued by Chase, the company said: "We are working to get all the facts and don't want to come to any conclusions too early. Obviously, all of our customers who withdrew money will be made whole."

It was not immediately clear whether any other ATMs had dispensed counterfeit bills.

While these counterfeit bills probably won't present much of a problem because they can be spotted right away, more sophisticated fakes are a rare but real scourge for consumers, especially those who rely on cash heavily for day-to-day banking transactions. In a 2006 report, the U.S. Treasury estimated that there is about $75 million worth of counterfeit bills circulating in the U.S. at any given time, or about 1.5 counterfeits for every 10,000 bills.

If you should have the bad luck to receive a counterfeit bill, you're essentially out of luck. It's illegal to knowingly pass counterfeit money on, so the only place the bill should go from there is into the hands of law enforcement.

What do you think? Are banks helpless when it comes to counterfeiting? Have you ever been passed a counterfeit bill? How did you know it was fake? Tell us your story.

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17 Comments
Denis DL
October 11, 2012 at 5:04 pm

JPMorgan Chase putting out counterfeit. I think it is high time to arrest CEO Jaimie Diamond for a lifetime of Fraud. Any normal person who tried to pass off $110,000 in fake bills would be put in jail by the Secret Service and get a Very High Bail, if any.

Lizzeth
October 11, 2012 at 4:17 pm

Long ago my roommate gave me $100.00 bills that was extremelly old. I found it weird but accepted and paid two weeks of child care service. When the childcare center's owner made the deposit, she was interrogated in the bank office. After that she call me to tellme the story because she new it was my bill. I asked my roommate about the situation and she said that how does she knew that my bill was fake? Could be anyone, I denied that my bill was fake because I trully trust my friend and she would never could give a fake bill. The daycare center ask me to take my child and don't never comeback. I paid the money,and the childcare owner called up the Children and Family to acuse me of child abuse. I was investigated and they closed the case due to lack of evidences. Time pass by, one day talking to my roommmate and remembering bad times, she told me that SHE KNEW THAT THE $100.00 BILL WAS FAKE....but she just wanted to help her boss to get rid of the bill, since I was working as a register in a store, she though that I will use the money in a manner that someone will get withou notice. She said to me "you are the idiot who use the bill to pay and did nor realized it was fake". What a bad experience since them I trust not even my shadow!

Bobby M
October 11, 2012 at 3:59 pm

In 2007, I once received a counterfeit $20 bill from a gentleman from Chattanooga, TN. This transaction occurred in Williamsburg, VA. When I got home to PA, and used the 20 for gas at my local station, the clerk alerted me to this. I gave him a good 20, and put the bad bill back in my wallet, where it has stayed ever since. I get it out once in a while, to get a good laugh at the corner tavern or at the bowling alley.

Jeanna
October 11, 2012 at 3:02 pm

I received a fake 20 from a supermarket once. My daughter noticed it was fake, no watermarks, and poor paper color and quality. The store traded me for a real 20, which I thought was decent of them

edward c. stengel
October 11, 2012 at 2:35 pm

All this computer stuff is fraud friendly. Nothing is safe on computers, and electronic banking is unsafe and unreliable.

Taylor
October 11, 2012 at 2:18 pm

Addendum: They probably wanted to avoid getting the ATM sentenced to jail time for dispensing counterfeit. I can see that poor ATM trying to defend itself, but being coldly sent up the river by a jury of its (heartless) peers.

Taylor
October 11, 2012 at 2:11 pm

Christopher's Logic is perfect, but I find it comforting that the ATM machines scan for fakes inbound as well as outbound. Whenever $ are directly involved, folks get real serious about their business. If only we realized the same thing about voting...I say let Diebold (or whoever) detect the deceased, illegal, and stupid voters at the polls!!!

Stella!
October 11, 2012 at 2:02 pm

I was offered a counterfeit $10 in change at a 7-Eleven. It was obviously counterfeit -- very "touch" evident, printed on bond paper; however, its appearance was very good. I refused the bill, and the clerk exchanged it for a good one. I don't know what the clerk did with the counterfeit bill, but I'm glad that it wasn't "mine." Be very aware of currency received in a cash transaction, as you point out in your article it will not be received by any bank anywhere for any reason. I check bills received from a bank teller too, as the counterfeit bills are everywhere! Very generally speaking, the higher the denomination the more likely it is that it could be counterfeit.

Christopher Logic
October 11, 2012 at 1:47 pm

It is just one of the latest ways that JP Morgan Chase is pursuing to recover the billions in dollars that they lost in bad investments.

JOE
October 11, 2012 at 1:42 pm

All paper money is fake anyway.
What is all paper money backed by? NOTHING
Only silver and gold is real money.