U.S. Currency: Printing of Flawed Redesigned $50 Notes
T-GGD-98-8
Published: Oct 01, 1997. Publicly Released: Oct 01, 1997.
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Highlights
GAO discussed issues related to the Treasury's recent production of flawed, newly redesigned $50 notes.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Treasury | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should formalize an agreement to have the Federal Reserve, Bureau of Engraving and Printing, Secret Service, and other relevant Treasury officials involved in the currency production process for future redesigned notes to inspect production and agree on an acceptible level of quality. |
The Federal Reserve and BEP, in consultation with the Secret Service, revised an existing MOU that established acceptable quality levels for each new currency design prior to general production. The Board and BEP are to mutually agree on a limited initial production quantity of newly designed currency to ensure that all technical problems are identified and resolved prior to full production. In addition, BEP recently implemented an Acceptable Quality Level Sampling Program to provide additional assurance to the Federal Reserve that the currency being shipped to the Federal Reserve Banks is of an acceptable quality.
|
| Board of Governors | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should formalize an agreement to have the Federal Reserve, Bureau of Engraving and Printing, Secret Service, and other relevant Treasury officials involved in the currency production process for future redesigned notes to inspect production and agree on an acceptible level of quality. |
The Federal Reserve and BEP, in consultation with the Secret Service, revised an existing memorandum of understanding (MOU) that established acceptable quality levels for each new currency design prior to general production. The Board and BEP are to mutually agree on a limited initial production quantity of newly designed currency to ensure that all technical problems are identified and resolved prior to full production. In addition, BEP recently implemented an Acceptable Quality Level Sampling Program to provide additional assurance to the Federal Reserve that the currency being shipped to the Federal Reserve Banks is of an acceptable quality.
|
| Department of the Treasury | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should limit initial production of newly designed currency to the number that would be necessary to provide reasonable assurance that all production problems are resolved, and include such a limitation in their written agreement. |
The Federal Reserve and BEP revised an existing MOU that requires them to scrutinize a limited production quantity of newly designed currency to ensure that all technical problems are identified and resolved prior to full production. The Federal Reserve must consult with BEP to establish quality criteria for each new design and evaluate and approve test notes provided by BEP prior to general production. BEP must provide pre-production test notes to the Federal Reserve for all newly designed notes. The Federal Reserve must notify BEP of any product that does not conform to acceptable quality levels.
|
| Board of Governors | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should limit initial production of newly designed currency to the number that would be necessary to provide reasonable assurance that all production problems are resolved, and include such a limitation in their written agreement. |
The Federal Reserve and BEP revised an existing MOU that requires them to scrutinize a limited production quantity of newly designed currency to ensure that all technical problems are identified and resolved prior to full production. The Federal Reserve must consult with BEP to establish quality criteria for each new design and evaluate and approve test notes provided by BEP prior to general production. BEP must provide pre-production test notes to the Federal Reserve for all newly designed notes. The Federal Reserve must notify BEP of any product that does not conform to acceptable quality levels.
|
| Department of the Treasury | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should explore the feasibility of design changes that might lessen the potential for production problems for future redesigned denominations. |
BEP, in consultation with the Federal Reserve, has implemented improved line structure in the newly designed $20 note to reduce the potential for production problems.
|
| Board of Governors | The Secretary of the Treasury and the Board of Governors of the Federal Reserve should explore the feasibility of design changes that might lessen the potential for production problems for future redesigned denominations. |
BEP, in consultation with the Federal Reserve, has implemented improved line structure in the newly designed $20 note to reduce the potential for production problems.
|
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Crime preventionCurrency and coinageFederal reserve banksForgeryInternal controlsMoney supplySecret serviceU.S. CurrencyDamsBusiness operations