Reformatting $$$ To Fight Counterfeiters

A reformatted $100 bill that is expected to start circulating in February 2011 will include a ribbon containing images of bells that morph into 100s to thwart counterfeiters, a federal official told lawmakers this week.

"When holding the note and focusing on the blue ribbon, the bells change to 100s," said Larry R. Felix, director of the Bureau of Engraving and Printing, at a House Financial Services subcommittee hearing on Tuesday. "When the note is tilted back and forth, the bells and 100s move side to side. If you tilt the note from side to side, the bells and 100s move up and down."

The Domestic Monetary Policy and Technology Subcommittee convened the hearing to examine the state of U.S. coins and currency, including anti-counterfeiting measures. The new $100 note, unveiled in April, marks the completion of a decade-long effort to overhaul U.S. dollar bills, Felix explained. Reconfigured $20, $50, $10 and $5 notes debuted in 2003, 2004, 2006 and 2008, respectively. With criminals increasingly using digital technology to reproduce U.S. currency, the new dollar bills are expected to help the public and law enforcement prevent counterfeiting.

But the vending machine industry is having a rough time adjusting to some of this tinkering. Customers do not like it when their valid dollars are rejected because a machine does not compute newfangled designs.

"We would specifically oppose changes to the size of the currency as this could dramatically change the physical design of our mechanism," Craig Hesch, chairman of the National Automatic Merchandising Association, a trade association of the food and beverage vending industries, testified at the same hearing.

The group also does not want added notches or cuts that might make verifying currency difficult.

"When bills are refused, sales are lost and customers are upset. Dramatic changes to the physical design such as size changes, notches, punches or cuts could result in increased costs to replace equipment, and could result in more bills being refused, resulting in lost sales," Hesch added.