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The purpose of this article is to familiarize the reader with the common security features of travelers checks, simple methods of detecting counterfeit checks and methods to train others to do the same.
The passing of counterfeit travelers checks is nothing new. However, with the increasing sophistication of desktop publishing and the decreasing amount of training in document recognition given to clerks, tellers and patrol officers, the number of counterfeit travelers checks passed is on the rise.
Recently in Scottsdale, Arizona, a well-dressed older couple, looking like so many other visitors to Scottsdale in the winter, went from store to store, purchasing small curios and T-shirts for the folks back home in Nebraska. They ambled through the stores during the three-day Martin Luther King holiday, purchasing a variety of inexpensive items with their $100.00 travelers checks. It’s estimated that this couple passed over $13,000 of counterfeit travelers checks during this three-day weekend: that’s 130 $100 travelers checks in three days.
Several days later, law enforcement officials were able to reconstruct the couple’s spending spree by talking to the merchants the couple had visited and their respective banks. It was a familiar story, one that is heard over and over again. But with only a small amount of knowledge and training, it is possible to spot bad travelers checks and prevent the passing of counterfeit checks.
Although the terms counterfeiting and forging are often used interchangeably, there is a difference. A forgery is usually an original document that has been reproduced to look like or resemble something else. That “something else” is non-standardized, such as a signature or a work of art. A counterfeited item is usually a standardized mass produced item that is being illegally copied and presented or sold as an original, such as travelers checks, currency, watches, etc…
There are several different types of travelers checks; the most common are American Express, Bank of America, MasterCard (Thomas Cook checks are now MasterCard), Citicorp and Visa. This article will deal only with American Express Travelers checks, but the process of identification and verification demonstrated herein is applicable for all travelers checks.
The passing of counterfeit travelers checks follows a familiar pattern. Most often a large quantity of bogus travelers checks are passed in several stores within a short time. Usually the bogus checks are passed over a long weekend. The Thanksgiving and Christmas holiday shopping seasons can be particularly busy. The stores can be in a downtown area or in a mall. The only requirement for the perpetrators is that the stores are close together so they can hit as many stores as possible in a short period of time. Purchases are commonly for $25.00 or less, using $100.00 travelers checks. Thus, the check passer not only receives the merchandise, he gets the change in cash. It is very common for the perpetrators to work in groups and hit an area hard, passing tens of thousands of dollars in travelers checks in just a few days. By the time the counterfeit travelers checks are identified, the perpetrators have left the area.
All travelers checks include common security features such as intaglio printing, holograms, kennegrams, micro-printing, MICR printing, special numbering, watermarks, ultraviolet ink, and special water-based inks.
Intaglio printing uses a steel plate. The reversed image is either etched or carved into the plate. Ink forced into the image on the steel plate is pressed against the paper with over twenty tons of pressure. Because intaglio presses are extremely expensive, they are usually only available to high-end financial printers or government printing offices. The documents produced have the fine line detail and the feel of money that only intaglio printing can produce.
Holograms are produced by taking a 3-D photograph of an image with a laser. When viewed from different angles, the image will appear to move. Kennegrams are produced in a similar fashion to holograms, but the image will change when viewed from different angles. It could be a portrait that looks to the left, then looks to the right.
Micro-printing is very small printing – so small that it is difficult or impossible to see with the unaided eye. It cannot be reproduced from desktop scanners or reproduced by a color copier. MICR printing is the unusual printing you see on the bottom of travelers checks as well as on regular personal and commercial checks. MICR (Magnetic Ink Character Recognition) is a very precise process; but with current desktop computer technology, MICR printing can be reproduced (at home or in the office) using special software, quality laser printers and a special magnetic ink toner cartridge.
Special numbering is the process whereby a code or numerical relationship is embedded in the numbering on a document.
Watermarks are a common anti-counterfeiting device that has been around for many years. A watermark image appears when a document is held up to the light. The image is formed when the wet paper fibers are shifted by a drying screen. Where the image is more opaque, there are more fibers; where it is more translucent, there are fewer fibers.
Ultraviolet ink is visible to an unaided eye only when illuminated with an ultraviolet lamp, sometimes known as a black light. Water-based inks can be smeared with water.
With all its anti-counterfeiting features, the American Express travelers check is an elegant, attractive, technological marvel. First and most apparent is the feel of the check, which is printed with the intaglio process, producing the raised ink and fine line detail that give it the feel of money.
Micro-printing is used on both the counter signature line at the bottom left and in the denomination button at the right center. This micro-printing, “American Express,” can be viewed with a magnifying glass. The MICR printing on the bottom of the check should be clear. The last nine digits of the MICR printing will correspond to the serial number of the check printed in the top right portion of the check.
The numbering sequence for the check is a nine-digit number with a two-letter prefix. The serial number at the top right should correspond to the last nine digits of the MICR printing at the bottom. The two-letter prefix of the serial number will correspond to the center numbers in the MICR printing. (eg. the letters RDBS on the serial number would correspond to R42S in the MICR printing.
The paper has a very distinctive watermark. When held up to the light the watermark pattern will appear as AM EX CO (globe).
When viewed under ultraviolet light the signature block, counter signature block, some of the fine line detail, and the seal at the right center position of the check will glow.
The primary methods of counterfeiting travelers checks are through color copying or offset lithography/printing. Each of these methods of counterfeiting travelers checks produces a travelers check with unique identifiable flaws. Not only is it clear that a travelers check is a counterfeit – it is also possible to tell by which method the counterfeit check was produced.
Color copied checks do not have the raised ink feel of intaglio printing. Color copying can’t reproduce fine line detail either: the delicate fine line images blur and ooze together. The micro printing disappears altogether. Color copiers fuse toner over the whole document – so the colored copied travelers check will have a flat, thick, shiny feel.
Offset printing is the choice of the sophisticated counterfeiter. The offset method produces a copy that can be very faithful to the original and, depending upon the skill of the printer, can even reproduce some of the micro printing. The feel of the offset travelers check is flat and the check has no sheen.
There are flaws common to both methods of counterfeiting. The checks have no watermark; they don’t use ultraviolet ink; and the MICR printing cannot be read by a check scanner since it was not produced with magnetic ink. The counterfeited checks produced are all identical to the travelers check that was copied.
Genuine travelers checks in higher denominations include other anti-counterfeiting features such as holograms, kennegrams, and water soluble inks.
A counterfeit ID kit can be assembled by anyone. The kit would consist of a magnifying glass, a UV lamp, a “cheat sheet” of anti-counterfeiting measures for easy reference and the kit user’s brain. A good reference for travelers checks and other documents is the US Identification Manual, Published by Driver’s License Guide Company of Redwood City, California. A whole counterfeit ID kit can be assembled for less than $250.00. (Training and education is the best and least expensive insurance.)
A good addition to the kit would be to purchase travelers checks common to the area and become familiar with their specific security features. Once the features are familiar the travelers check can be cashed in or spent, so there is little or no investment. The issuer of the travelers check may have programs for training and/or literature.
Once one person has been trained to identify counterfeit items they can train others what to look for when accepting a travelers check. The feel of the travelers check, the serial numbers, and the watermarks are easy to authenticate. The micro-printing is the second easiest feature to identify. The third easiest is the ultraviolet ink since identification requires a UV lamp.
Although the final determination of authenticity for a travelers check can only be made by the issuing company, suspect travelers checks can be flagged. It’s a fine line but an important distinction none the less.
Counterfeiting hurts everyone, but it hurts the legitimate purchaser the most. Stores and banks will simply charge more to cover the losses. The problem is most acute for the entity that honors the bogus travelers check. If the check is counterfeit, the recipient has provided goods and or services for nothing. More often they have provided cash for a worthless piece of paper.
L. Burke Files is a Private Investigator specializing in Financial Investigations, an author of many articles on related subjects and a book on financial investigations. Mr. Files lives and works in the Phoenix Metropolitan area of Arizona.
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