Oklahoma Bankers Association We make bankers better!
SSA Lantz Stuart, with the U. S. Secret Service, one of our federal partners, has shared information that counterfeit U.S. Savings Bonds are being fraudulently negotiated in financial institutions across Oklahoma. He has notified us that losses were large ($176,000) for the impacted banks in Nevada where it originated and nationwide losses are estimated at over $50 million. This activity has now spread to Mississippi, Louisiana, Indiana, Kansas, Michigan and Oklahoma.
On Jan. 1, Tulsa police arrested two suspects in possession of multiple counterfeit U.S. savings bonds, printers, cell phones and a laptop. Banks in Kansas were faced with two additional suspects identified as fake bond passers who are being sought.
Two additional suspects have been identified in the Northeast Oklahoma cases and Stuart is assisting on them.
We have also received details from a Wichita, Kanas-based financial institution that experienced similar losses. They have also identified two individuals in the ring who each opened sole owner accounts with the bank and began redeeming large quantities of bonds within a few days or a week. One perpetrator went to multiple branches and redeemed a few bonds at a time.
The bank in Kansas also provided the following details on the fake bonds: They noted when comparing a counterfeit bond to an authentic bond, they are clearly different, but unless a person is familiar with savings bonds, it would be hard to identify otherwise. Here’s a few characteristics we’ve noticed on the counterfeit bonds:
. Series EE Bonds with $5,000 and $10,000 denominations.
. Duplicate bond numbers with different issue dates (mm/yyyy) listed in the top right corner.
. The border is around the outside of the bond and around the denomination in the top left corner appears to be black in color. When you look closely, you can see blue/green color bleeding from being printed on an ink jet printer. The border of an authentic bond is grayer in color.
. The background color of the bond is more of a pale-yellow or pale-peach color. Authentic bonds are a rich-peach color.
. The feel/texture of the counterfeit bond is textured or rough. You can feel the ink on the background and the grain of the photo on the left. An authentic bond is completely smooth, there is no texture in the peach-colored background.
. The U.S. Treasury seal along the bottom border is blurry, the lines around the spokes of the emblem are not crisp.
. There is microprinting in the border of the SSN box that says USBONDS. The counterfeiter attempted to recreate this, but the letters are blurry and spacing is off.
Some of our bankers have implemented a policy they only cash bonds for their customers who have had an account for at least six months, so we may deter losses while still serving known customers. However, there is no legal requirement banks cash savings bonds even for established customers. Banks may decline to cash savings bonds and/or the amount they will cash for a customer at a time to avoid the bank taking a loss if the bond is a counterfeit or has previously been cashed.
If you have any additional passings of these counterfeit savings bonds at your financial institution, or an active investigation, please contact SSA Lantz Stuart, lantz.stuart@usss.DHS.gov. If you have any other questions, contact the OBA’s Elaine Dodd, elaine@oba.com.
We are also seeing an increase in counterfeit U.S. Treasury Checks, and these are easier to check for validity. There is a TCVS (Treasury Check Verification System) at www.tcvs.fiscal.treasury.gov, which can be done rapidly. An even easier quick check is the seal by the Statue of Liberty’s head is a bleeding ink seal. A drop of water or dampened finger will run or smudge red. Note there is no requirement that banks cash U.S. Treasury checks for non-customers whether the check is a tax refund, social security, etc. Banks are free to charge a fee to non-customers for cashing U.S. Treasury checks provided it discloses the amount of fee before accepting the check.
Hopefully these trends will stop or diminish with the recent apprehensions. However, the potential loss for our banks requires our bankers be made aware of these circumstances and continue to stay alert.