Secret Service: Peru Top Producer of Counterfeit U.S. Dollars

They know how to make money: by hand

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Karel Navarro, File / AP

A police officer inspects an alleged counterfeit $100 U.S. dollar note during a media presentation in Lima, Peru.

Normally it’s a no-brainer to think of cocaine as the main contraband to come out of Peru, and it does make lots of money for those willing to deal with the illicit trade.

But as far as illegal operations go the real moneymaker is money that you make, literally.

According to the U.S. Secret Service, Peru has overtaken Columbia as the No. 1 source of counterfeit U.S. dollars. As much as $103 million in the phony currency has been produced in the South American nation over the course of the last decade.

Authorities say the counterfeit frenzy switched from Colombia to Peru when the United States began cracking down harder on Colombian drug operations, and the pressure spilled over to other illicit operations. At the same time, the practice got better among Peruvians.

So much faux currency, in fact, comes out of Peru that the Secret Service opened up an office there in 2012, which has resulted in the arrests of 50 people on counterfeiting charges.

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Unlike run of the mill counterfeiters normally found (and busted) in America — who use inkjet printing methods to make the bills and then send them into the marketplace — Peruvians take the extra step of finishing them by hand, according to officials.

Their way of counterfeiting employs such sophisticated methods as Corel Draw or Microsoft Office, then a process of plate etching and offset printing,  varnishing and cutting, insertion of fake security strips, covering the bills with rough fabric to emulate real money, and finally sanding them down.

Once the bills are finished, the $100 denominations are smuggled to the United States, where retailers are less likely to detect them. But smaller bills are sought after in places like Argentina and Venezuela because of high demand for the U.S. dollar, the most valuable currency on the globe.

“It’s a very good note,” a Secret Service officer at the U.S. Embassy told the Associated Press, which did not identify him for security reasons. “They use offset, huge machines that are used for regular printing of newspapers, or flyers. Once a note is printed they will throw five people (on it) and do little things, little touches that add to the quality.”

It takes up to five days to make $300,000 worth of the notes, but they are ultimately more profitable than cocaine, of which Peru has been a top producer. But because the drug carries more expensive overhead costs and processing and transporting it is more complicated, counterfeiting is a better option, an investigator with the Peruvian national police’s fraud division said.

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