Surge in number of fake pound coins -- Alarm at the Royal Mint as one in every 40 is found to be counterfeit

FROM:
http://www.independent.co.uk/news/uk...s-1519082.html

Surge in number of fake pound coins

Alarm at the Royal Mint as one in every 40 is found to be counterfeit

By Martin Hickman, Consumer Affairs Correspondent
Thursday, 29 January 2009

Criminal gangs have dramatically increased their
output of counterfeit £1 coins in the past year,
pumping millions of fakes into the economy and
threatening to undermine public confidence in the
money supply.

Sampling by the Royal Mint of coins in circulation
across Britain has found that the number in
circulation rose by 27 per cent during 2008,
raising the amount of sham coinage to £37.5m - or
one £1 coin in every 40 - the highest since the
coin was introduced in 1983.

In 2002, one in 100 £1 coins was a worthless fake
and in 2007 one in 50. Royal Mint officials are
considering launching a public information campaign
to warn the public how to spot the fakes.

Technically any person handing one over is breaking
the law, meaning that millions of people are
unwittingly committing a crime every year, but many
of the fakes closely reproduce the metallic compound
used by the Royal Mint, making them hard to detect
by bank counting machines.

The rise in forgeries, revealed in documents
obtained by The Independent, prompted a warning
from an expert that their prevalence could undermine
confidence in the money supply.

"If the public starts losing confidence in coins
and notes, you get people refusing to take them,"
said Robert Matthews, who retired as Chief Assayer
of the Royal Mint in 2002. "It could damage a lot
of small shopkeepers doing lots of small transactions."

The latest results suggest many people encounter
bogus cash weekly, or daily if they handle money
in a shop, pub, café or other business.

The Mint checked 15,481 coins supplied by banks
and post offices at 31 places across the UK in
October and November 2008. On average, the
proportion of fake £1 coins since November and
December 2007 rose from 2.06 per cent to
2.58 per cent.

There were much higher levels of fakes in Northern
Ireland (3.6 per cent) and London and the South-east
(2.97 per cent). They were lowest in the North-west.
Concerned officials at the Royal Mint have opened
talks with the Treasury and the police on the
problem. Bank and building society tellers may be
given specialist training.

Mint officials are also talking to vending operators
about whether they need to tighten their mechanisms
so they reject more coins, which could mean more
frustration for those trying to buy parking
tickets, drinks or cigarettes.

Martin Cragg, Royal Mint head of corporate affairs,
said: "A number of measures are being undertaken
by the Royal Mint with third parties to combat
counterfeiting, including HM Treasury, the banks,
vending operators and law-enforcement agencies.

"In particular, we are considering whether it
would be appropriate and helpful to issue further
publicity material which may assist the public
and others to identify counterfeit coins."

Little is known about the counterfeiters - few
have been caught in recent years. One theory is
that blank coins from Italy and eastern Europe
are "headed and tailed" by lower-level
criminals in the UK.


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