Constant fight against counterfeit euros

Elina Rimpiläinen, Linda Finell

Comprehensive and active means of tracking down and removing fraudulent euros from circulations has yielded results during the past year. The success can be credited to cooperation between EU member states, the European Anti-Fraud office (OLAF) and European institutions. One explanation for the decline is that the European citizens have become more accustomed to the common currency and are more able to spot forgeries.

The amount of counterfeit euro coins removed from circulation decreased by 15 % last year, but the number of fraudulent banknotes rose by 4.7 per cent, with approximately 606 000 counterfeits withdraw from circulation. The European Central Bank (ECB) notes that the number of counterfeits in circulation remains very low in comparison to the amount of genuine euros. Regardless, fake money eats away at business owners’ income.

“Shopkeepers, small businesses and citizens are most at risk of receiving fake coins and notes,” Algirdas Šemeta, a member of the European commission notes. He stresses that taking action against counterfeit money is crucial in protecting honest taxpayers and their means of income and adds: “We will continue our efforts to detect illegal money and root out these illegal activities across Europe.”

Counterfeit euros have begun appearing more frequently since the European financial crisis. In 2008 a remarkably large amount of fake euros was seized by the police in Colombia and late last year the Polish police shut down a huge counterfeiting euro shop. The Spanish authorities also dismantled a group of counterfeiters in late 2011.

It is up for speculation if the countries where the economy is unstable, are most likely to produce fake money.

Fake euros circulate mostly in the largest EU states. For example, over 90 000 counterfeit euro notes were seized in Germany in 2010. As a general rule, the amount of fraudulent money has been on the rise for since 2008.

It’s also typical for countries switching over to euro to see a rise in counterfeits after the switch-over. This has recently happened in Estonia, where the number of fraudulent banknotes surged briefly in January 2011. Fakes have since been less frequent and currently there are some dozens removed from circulation each month.

Unlike in Europe in general, the number of counterfeit euro banknotes in circulation in Finland decreased in 2011. According to the Bank of Finland, exactly 827 fraudulent banknotes were found last year, while the number was 1 052 the previous year.

The most counterfeited note is still the 20 euro note. Approximately one quarter of the total amount of fraudulent banknotes found in Finland were 20 euro notes.

 

Decreasing the counterfeit is a sum of many actions

The system for the protection of the euro includes many elements and binds all countries where euro is used as currency. The practical measures are the following:

  • Competent national authorities, such as national central banks and other empowered bodies must systematically transmit the technical data on counterfeit euro notes and coins to the ECB, which will be responsible for storage and processing.
  • Competent national authorities are obligated to allow the National Analysis Centre to examine suspected counterfeit notes and to allow the Coin National Analysis Centre to examine suspect coins.
  • All new types of suspect notes and coins must be sent to the European Central Bank.
  • Credit institutions and other payment service providers and on other institutions that process and distribute notes and coins to the public must ensure that all euro notes and coins that they have received and intended to put back into circulation are checked for authenticity.
  • Payment service providers have to withdraw from circulation the coins and the banknotes that are suspected as counterfeited and to hand them over to the national authority.
  • Countries must provide effective penalties to institutions that fail to discharge their obligations

 

Besides these measures institutions and states inside EU are cooperating with non-EU countries and international organisations.

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