North Korea And The Supernote Enigma

North Korea, it is often said, is a criminal state. One of the more persistent stories supporting that allegation is that the North Koreans are counterfeiting U.S. currency. Through repetition, the claim has taken on an aura of proven fact. This in turn has been cited as justification for everything from imposing punitive measures against North Korea to suggesting that the nation cannot be trusted as a partner in nuclear negotiations.

The evidence against North Korea is widely regarded as convincing. "The North Koreans have denied that they are engaged in the distribution and manufacture of counterfeits," says Daniel Glaser of the U.S. Treasury Department, "but the evidence is overwhelming that they are. There's no question of North Korea's involvement."1 There is no denying that North Korean citizens have been caught passing counterfeit currency in Europe and Asia, and some defectors from the Democratic People's Republic of Korea (DPRK — the formal name for North Korea) claim to have first-hand knowledge of state-run counterfeiting operations. In Western media reports the case is treated as proven. Yet the closer one examines the matter, the murkier the picture becomes.

Counterfeit currency attributed to North Korea raises deep concern due to its extremely high quality. Dubbed supernotes, their production process closely matches that of the genuine article, and the engraving is so fine it rivals that of the U.S. Bureau of Engraving and Printing.

Unlike most of the world's counterfeit currency, which is printed on offset presses or through digital processes, super notes are printed on an intaglio press. The Bureau of Engraving and Printing uses Giori intaglio presses for the engraved portions of its bank notes, and an offset press for the background colors. Super notes use the same technology. An intaglio press operates by applying ink on its plates and then wiping them clean, leaving ink only in the engraved lines. The plate is then pressed against the paper, depositing the ink in ridges. The result is raised printing that ordinary counterfeits can't duplicate. Super notes have the same look and feel as U.S. currency.

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