Removing counterfeit coins for circulation

I read a recent report about the high level of counterfeit £1 coins in circulation, around 2% are fake.
The royalmint website states that

So my question is, does the bank/post office get reimbursed by the royalmint for money they have effectively lost by identifying a counterfeit ?

That’s a good question. I know ordinary retail operations and members of the public don’t get compensated for turning in counterfeit currency, but if there’s some kind of formal co-operation going on, maybe they’ve come to some arrangement.

But I suspect not - it’s probably more a case of the mint asserting that possession or circulation of counterfeit currency is prohibited and demanding compliance.

When I lived in the UK in the 90’s I found a counterfeit £1 coin. It was an obvious fake; the “brass” flaked off of the surface, revealing some kind of blackish metal beneath. I somewhat stupidly decided to take it to Lloyds Bank, as I was there anyway, and turned it in as a counterfeit. The bank manager agreed that, yes, the coin was a fake, and gave me a shiny new real £1 coin for my trouble.

The manager did suggest that had I turned the coin in to the police I probably wouldn’t be seeing any compensation, but maybe he appreciated my honesty or something. I don’t know.

What was “stupid” about this decision? You got a real £1 for your fake one. What do you think you *should *have done?

I should have taken it to the police station, because the coin was evidence of a crime. Granted, I wouldn’t have gotten a pound back from the police, but taking it to the bank certainly wasn’t the right move. I never would have done that here in the States, so why I thought it was a good idea in the UK I still can’t explain.

But the bank is going to pass the coin on to law enforcement authorities anyway: if they try to put it back into circulation, they are committing a crime.

I don’t know how they do things across the pond, but here in the US when a bank gets a counterfeit bill they fill out some paperwork and forward everything along to the Secret Service.

[tangent]
We’d recently gone on vacation in Tanzania and Zanzibar. Immediately outside the airport in Zanzibar were a number of men asking if we would exchange £1 coins for paper money. I was wary enough not to take the offer, but wondered if these were the counterfeit coins or ‘tips’ given by tourists. This may be a safe (for those passing them) way for the coins to get into circulation.
[/tangent]

I had a few of those when I was a church treasurer. I think they were cast in lead or pewter or something like that. I turned them in at the police station and was given a receipt so I could balance the books.

So people did take George Carlin’s advice? :cool:

I’m told that a common method to get rid of counterfeit money among some people is to “long change” someone. Say you have a counterfeit 10 you want to get out of your hands. I buy something from you that costs $5 and pay with a 20. You give me back a 5, a 10, and the counterfeit 10. It works because, ideally, I’m going to be too happy at my good luck to do anything but get out of the shop as quickly as I can.

But this makes no sense.

If I’m a counterfeiter, I want to exchange my counterfeit money for real money or goods/services (that’s the whole point of counterfeiting). If, on the other hand, I’m not the counterfeiter and just want to get rid of a fake note, why not just burn it or throw it away, or hand it to the police?

“Long changing” as you describe it is just a way of giving counterfeit money away for nothing, so I don’t see why this is a better option than either of the above.

I think KneadToKnow might have just messed the numbers up. Long changing like that would be no more advantageous than simply burning the fake note.

Perhaps it was meant to be:

Person buys something worth $5 with a $20 note, you accidentally give them two tens - one real, one fake - they think they’re $5 up, so they keep schtum, but in fact, you’ve made $5 out of the deal and they’re $5 down, because the fake $10 is worthless.

Another possibility is that among a pile of genuine pound coins would be a couple of one design of Swazi Lilangeni coins. (I remember a news story only a few years ago about organised criminals bringing these into the UK, selling bags of them to people who could then use them in London Underground ticket machines. Can’t find it now.)

“Liaising”?? Boy, does that go clunk on your ear.

Sorry, yes, this was the intended combination. That’s what I get for posting at work.

If you turned in a one-pound coin, real or fake, to a bank or police station here in the states, all you’d get in a quizzical look :D.

On a serious note, counterfeit American currency is not redeemed for face value at a bank or anywhere else. You’re out the entire amount. The Lloyd’s manager did you a solid.

And I like the sound of liaising.

FWIW when a victim reports a counterfeit American bill (banknote), they are out the value of the note. The government or Federal Reserve will not make it good. That, and also I suspect the victim may have to answer a question or two. They take counterfeiting very seriously, almost as much as international drug smuggling and terrorism.

I’d be surprised if anyone has tried to counterfeit a U.S. coin in decades, except possibly the gold and silver ones sold to investors.

Why do they counterfeit one pound coins? Wouldn’t it be easier and more lucrative to counterfeit bills?

Around 1992 a former bank manager told me that he knew that some banks deliberately issued a proportion of conterfiet notes that they took in by accident.

About 10 years ago where I lived, there was a spate of fake £1 coins - generally given as change in a pub. They were made of lead and easy to spot - unless one had a few (Imperial) pints under the belt.

Not if you don’t have the equipment to get them right, which becomes more difficult with each new design - people are on the lookout for dodgy notes more than for coins.