BI says economy still safe from fake banknotes

BI says economy still safe from fake banknotes

JAKARTA (JP): Bank Indonesia deputy director for banknote
supervision Kaidi Thohir said on Wednesday that the amount of
fake rupiah banknotes in circulation did not pose a threat to the
economy.

Kaidi said that the amount of the fake rupiah handed over by
the police and the banking community from January to April
amounted to Rp 6.43 billion, representing only about 0.0061
percent of the total banknotes in circulation.

"The 0.0061 percent is too small. This (level) is no threat
to the economy," he told a news conference.

"But the scale of the news reports is creating a greater
problem," he said, pointing out one report which said some people
had started to reject Rp 50,000 banknotes.

He also said that some 88.67 percent of the confiscated fake
banknotes had not been circulated to the public.

Retired Army senior officer Soemarjono was officially named
the main suspect in a counterfeit money case on Tuesday after he
failed to refute allegations when Surabaya Police confronted him
with other suspects.

The Surabaya Police have confiscated large sheets bearing an
equally large number of uncut fake Rp 50,000 notes, totaling Rp
4.7 billion. The notes were of the old type, bearing the picture
of former president Soeharto, while new banknotes depict the
National Anthem composer W.R. Supratman.

The central bank said earlier this year that the confiscated
fake rupiah bills in circulation last year amounted to Rp 6.17
billion, equivalent to about 0.01 percent of the total Rp 50.4
trillion of banknotes in circulation.

For 1998, the total fake bills in circulation reached 0.013
percent of the money in circulation, while for 1997 it was 0.016
percent.

Kaidi denied allegations that the central bank was somehow
connected to the cases of counterfeit money.

There have been rumors that the counterfeiters had been able
to print fake money by using the same banknote paper as that used
by Bank Indonesia.

Kaidi said this was impossible because Bank Indonesia ordered
the paper at an amount exactly relating to the number of
banknotes to be printed.

He also said that the suppliers, mostly from overseas, would
not supply the counterfeiters with the banknotes paper because
their business was based on trust.

"The suppliers also supply banknote paper to other countries.
So their image will be badly tarnished if they're proven to have
supplied the counterfeiters," he said.

He said that the central bank had 10 suppliers of banknote
paper, and that nine of them were foreign suppliers, namely
Portals from the U.K., Germany's Louisenthal, France's Arjo
Wiggins, the Netherlands' VHP, Italy's Cartiere M. Fabriano,
Crane & Co. of the U.S., Spain's Fabrica de Moneda, Sweden's
Tumba Brak, and South Korea's Hyosung/Komsep.

The local supplier is PT Pura Barutama.

Kaidi admitted that the quality of the fake money was
improving.

But he said that two things could not be copied: the watermark
and the metal strip.

He added that the surface of the fake money was smoother than
the authentic banknotes because of the use of different types of
printing machines.(rei)