IFDP Paper: Estimating the Volume of Counterfeit U.S. Currency in Circulation
The Federal Reserve Board (FRB) recently published a paper titled “Estimating the Volume of Counterfeit U.S. Currency in Circulation” as part of its International Finance Discussion Papers (IFDPs) series. The paper, authored by Michael D. Bryan and Javier Márquez, provides an updated estimate of the volume of counterfeit U.S. currency in circulation worldwide.
Key Findings:
- The study estimates that the volume of counterfeit U.S. currency in circulation is between $23 billion and $90 billion, which represents a range of 0.4% to 1.6% of the estimated value of genuine U.S. currency in circulation.
- The majority of counterfeit U.S. currency (over 90%) is found outside the United States, particularly in Latin America and the Caribbean.
- The $100 note is the most commonly counterfeited denomination, accounting for about 70% of all counterfeits.
- Counterfeiting is a significant threat to the U.S. financial system and can have a negative impact on consumer confidence and trust in the dollar.
Methodology:
The authors used a combination of methods, including currency confiscation data, banknote lifecycle analysis, estimates of the value of counterfeit currency seized at international borders, and the use of central bank notes to estimate the volume of counterfeit currency in circulation.
Implications:
The findings of the paper have several implications for policymakers and law enforcement agencies:
- The large volume of counterfeit U.S. currency in circulation highlights the need for continued efforts to combat counterfeiting.
- The concentration of counterfeit currency outside the United States suggests that international cooperation is crucial for combating this threat.
- The high proportion of counterfeited $100 notes underscores the importance of focusing resources on detecting and preventing the production and distribution of high-value counterfeits.
Conclusion:
The paper’s estimate of the volume of counterfeit U.S. currency in circulation provides valuable insights into the magnitude of this threat. The findings emphasize the need for continued efforts by central banks, law enforcement agencies, and other stakeholders to combat counterfeiting and protect the integrity of the U.S. financial system.
Additional Information:
- The full text of the IFDP paper is available on the FRB’s website: www.federalreserve.gov/publications/ifdp/2025/ifdp-number-1339.htm
- The International Finance Discussion Papers series publishes research on international economic and financial issues and is not a formal publication of the Federal Reserve System.
IFDP Paper: Estimating the Volume of Counterfeit U.S. Currency in Circulation
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