June 19, 2009 / 3:52 PM / 10 years ago

U.S. Treasury says bonds seized in Italy are fakes

WASHINGTON, June 19 (Reuters) - A purported $134 billion in U.S. government bearer bond certificates seized by police near the Italian-Swiss border are fake, the U.S. Treasury said on Friday.

“Based on the photograph we’ve seen online, they are clearly fake. And not even good fakes,” said Stephen Meyerhardt, a spokesman for the Treasury’s Bureau of the Public Debt.

He added that there is only $105 million in Treasury bearer bond securities outstanding, so the $134 billion amount seized far exceeds the universe of outstanding securites.

The Treasury’s determination confirmed the suspicions of Italy’s Guardia di Finanza, or tax police, which seized the bond documents in early June from two Japanese nationals at the Chiasso rail station in northern Italy, close to the border with Switzerland.

The bonds comprised 249 “Federal Reserve” bonds of $500 million nominal value each and 10 “Bond Kennedy” with a $1 billion nominal value, the tax police said on June 4 in a statement on the seizure of the bonds.

A senior tax police officer said Italian authorities also were checking whether the two travellers’ Japanese documents are genuine.

In the last two years, Italian authorities have seized some $800 million of U.S. bonds in the Como area in northern Italy.

Meyerhardt said U.S. government investigators believe that the seized bond forgeries were made using commercial photo software to alter the image of a $100 bill to increase the amount into millions or billions and add what appear to be interest coupons.

He said this appears similar to scams that the Treasury uncovers fairly frequently involving bearer and other securities issued in the 1930s and 1940s. Images of similar counterfeit bonds appear on a Treasury website aimed at combating fraud, here .

The case has been turned over to the U.S. Secret Service, which investigates and combats counterfeiting of the U.S. currency. A spokesman for the Secret Service was not immediately available for comment.

The forgery determination came a day after the Treasury warned U.S. banks against the potential for increased currency counterfeiting activity and large cash transactions by North Korea in an effort to evade U.N. sanctions aimed at cutting off financing for Pyongyang’s nuclear weapons and missile programmes.

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