U.S. unveils new $5 bill to thwart counterfeiters

By Andy Sullivan

WASHINGTON (Reuters) - The U.S. government introduced a new $5 bill on Thursday that includes purple ink, several watermarks and other security features to deter counterfeiters.

The bill features a large, purple numeral "5" on its back side and a purple seal on the front, continuing the increased use of color in the "greenbacks" that have long stood in drab contrast to the more elaborate bills used by many other countries.

The new bill, which will go into circulation in 2008, will include two watermarks -- a large numeral "5" to the right of the portrait of President Abraham Lincoln, and a column of smaller "5"s to Lincoln's left.

An embedded security thread, bearing the letters "USA" and the numeral "5" in an alternating pattern, runs vertically to the right of the portrait.

The new features should thwart a favorite technique of counterfeiters -- bleaching the ink out of existing $5 bills and printing them to look like $100 bills, U.S. officials said in an online press conference.

"It's a matter of holding up this bill to the light and looking for the two watermarks," said U.S. Treasurer Anna Escobedo Cabral. "The public really is the first line of defense against counterfeiters."

The U.S. government has redesigned its currency several times since 1990 in an effort to stay ahead of counterfeiters armed with color copiers and scanners.

Digitally-produced bills accounted for 54 percent of all counterfeit currency caught last year, up from 1 percent in the early 1990s, said Michael Merritt, a deputy assistant director at the U.S. Secret Service.

The $10, $20 and $50 bills have received colorful make-overs since 2003. Officials said the $100 bill is next.

Law enforcers seized $54 million in counterfeit bills before they entered circulation last year, while another $65 million was pulled out from circulation, Merritt said -- a small fraction of the $770 billion in U.S. currency in circulation worldwide.