Counterfeiters cause pain as they lift their game

Under existing law, the Reserve does not compensate a business that finds a counterfeit note when counting the day’s takings.

Given the tight margin in the retail sector, the bank says there are large costs for businesses that have goods paid for with a fake $100 or $50, the denominations that are counterfeited the most.

“Although losses associated with counterfeiting are relatively minor compared with other kinds of payment fraud, receiving a counterfeit can have severe consequences for people with low incomes and businesses with small profit margins,” the RBA found.

“The average retail business would need to sell around $2200 worth of goods or services to recoup the loss sustained through a single $100 counterfeit banknote.

“Businesses that face narrower profit margins would need to raise prices or sell even more goods or services to make back any losses due to counterfeiting.”

While between $1 million and $2 million in counterfeits are received by the RBA each year, it observes that not all fake notes are surrendered to the police.

It estimates that about 20 per cent of people who find a counterfeit either keep it or throw it away.

The RBA is introducing new notes, including a fresh $20 later this year, partly in a bid to counter counterfeits.

The bank said despite its efforts, the rate of fake notes would remain slightly elevated because counterfeiters were improving their production.

“The declining cost and growing sophistication of technology will likely enable counterfeiters to more easily produce counterfeits on a larger scale than was the case previously, and the Reserve Bank does not necessarily expect the counterfeiting rate to return to the low levels of the early 2000s,” it said.


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