Changing the Color of Money

Andrew Jackson (search) is getting a lively new makeover by the U.S. government, which has freed him from his former frame and brightened up his background on the new $20 bill, entering circulation through commercial banks today.

These changes aren’t an exercise in vanity – the $20 bill (search) is a counterfeiter's favorite muse, regularly dispensed from ATM machines and toted in wallets but rarely checked by merchants for authenticity. In an attempt to stay ahead of copying crooks, the U.S. government is getting clever with cash.

“The security features we’ve added are really two-fold,” said U.S. Secret Service (search) agent Jean Mitchell. “They make it more difficult for counterfeiters to reproduce and also give the general public useful tools to determine if their money is counterfeit.”

While maintaining the same measurements and feel as its predecessor, the new greenback will make room for other colors of the rainbow, something that hasn’t been seen on American currency since 1905. Soft background colors of peach, green and blue will make the latest incarnation of the $20 noticeably different.

Other specifics the public can look for are the words “TWENTY USA” printed in blue and tons of tiny yellow number 20s in the background. Also making their way into the bustling bill are a blue eagle sitting to the left of the presidential portrait and a metallic green eagle and shield to the right. Jackson is also coming out of his shell – the border that used to surround his portrait has been removed.

Though it may take the public some time to get used to the new bill, modernizing money is serious business for the government when it comes to counteracting criminals looking to make an easy buck.

“In the fiscal year of 2001, $600 billion were in circulation and out of that $49 million in counterfeit currency was passed on the public,” said Mitchell. “World-wide, about one dollar for every 12,400 in circulation is counterfeit.”

But while the government is enhancing currency with new security features, computer technology is also leaping forward at a pace that's hard to compete with, said David Kirkpatrick, senior editor for technology at Fortune magazine.

No matter how bright the bill becomes, colors won’t be an obstacle for criminals, he said. “Color copiers are already capable of picking up the most subtle details. The new colors won’t make it harder to copy the surface of the bill.”

The new $20 will still feature the anti-counterfeiting features found on the current version, which was last updated in 1996: The watermark (a faint image similar to the portrait visible when held up to the light), the security thread (a vertical strip of plastic embedded in the bill that reads “USA TWENTY”) and color-shifting ink (ink that changes the numeral “20” in the lower-right corner on the face from copper to green).

Other spiffed-up former presidents will eventually join Jackson. Updated versions of the $50 bill will roll out in 2004 and the $100 (the most counterfeited U.S. bill outside of the country) in 2005. Mitchell said the new versions are staggered to give the public time to adjust to change.

But the use of all of the different technologies in the latest bill is “indicative of how difficult the counterfeit problem is,” Kirkpatrick said. “Obviously not enough was done in the last round or they wouldn’t be doing it again.”

If the public closely inspects their bills for the new changes, funny money could become less prolific, but the ability to counterfeit remains staggeringly easy, Kirkpatrick said.

“You can just stick one of these things on a high end color printer and get something that from an arms length wouldn’t look any different," he said. "All they have to be able to do is pass it once.”

Still, the government is confident the new $20 will stand up to funny money challengers.

“This is the most secure note the U.S. government has ever produced,” said Federal Reserve Board Governor Mark W. Olson in a statement.

Even with all the fancy additions, Mitchell said the public is the first line of defense against counterfeiters because if they spot a fake, they can take it out of circulation (a wise move anyway since it’s illegal to spend a counterfeit bill).

“If they know their money, they are less likely to become a victim," she said.