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Counterfeit Round Pounds on the Rise
By Richard Giedroyc

The British one pound coin has been called all sorts of nasty things since it was introduced in 1983. Among its nicknames are "the Maggie" after then Prime Minister Margaret Thatcher under whom the coin was introduced, and the "round pound." The problem with an estimated one in 40 of the coins now in circulation is that they can be called "counterfeit!"

The intension of replacing the one pound bank note with a circulating coin was primarily to ensure the currency of that value would last longer in circulation, while reducing manufacturing costs. The bank note typically wore out in between six and 18 months, while the coin has been estimated to last between 20 and 40 years. Since at that time bank notes rather than coins were the primary target of counterfeiters the concerns now being voiced were not considered to be a major concern in 1983.

In recent decades coins have become increasingly popular worldwide as a substitute for what had been the lowest denomination bank note in many countries. This has increased the interest in counterfeiting coins as well, since such a denomination could now be worth the trouble of faking. This has been found to be true not only in Great Britain, but in Canada, the European Union, and other places where a coin rather than a bank note now circulates in placement of what we in the United States would consider it to liken to the dollar denomination.

The British Royal Mint periodically samples coinage in circulation in Great Britain. The previous sampling indicated one in 50 one pound coins was bogus, but the new sampling showed an alarming increase to one in 40 coins, according to the Jan. 30 issue of Banking Times.

According to the Banking Times article, "Faked coins could therefore account for £37.5 million [about $75 million U.S.] of cash in circulation," adding, "It also represents a 26 percent rise on 2007."

The BRM sampling included 15,481 £1 coins found at 31 banks and post offices throughout Great Britain. Since the sampling was taken the mint has been working with banks, the post office, police, and the vending industry to rid the system of as many counterfeits as possible. This includes offering the public detailed information regarding the designs and specifications of genuine £1 coins, information that appears on the BRM Web site.

Banking Times reported the majority of the counterfeit coins will not work in vending machines or in counting machines at banks. Since the coins circulate, this is of little comfort to the average consumer that might either get one in change or try to use one, only to have it confiscated without reimbursement if the party receiving the bogus coin detects the coin's lack of authenticity.

As the Banking Times article states, "Consumers are being reminded that it is a criminal offence to use a counterfeited coin, so someone discovering a forgery should not attempt to spend it."

British £1 coins do have some security features that make them more challenging to reproduce than appear on lower denominations. Primary among these features is an incused lettered edge superimposed on a reeded edge.

The proliferation of counterfeit coins in recent years may encourage more countries to use holographic type designs and color enhancement on circulation coinage as well as on non-circulating legal tender commemoratives, which is where most of this type of technology is now applied.

 



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