Thursday, December 9, 2010

A billion dollar printing fiasco - U.S. $100 bills made worthless by a "printing" error.

Was it a failure of basic print quality control?

The U.S. Federal Bureau of Engraving and Printing has identified a problem in the new security enhanced $100 note. Apparently the notes have blank patches caused by "sporadic creasing of the paper" which were discovered only after the printing was completed.
The Bureau's current visual print quality control system may be inadequate for the demands of this new level of security printing.

1.1 billion of the new bills have been printed but officials don’t know exactly how many of those bills are flawed. There is, however, speculation that as many as 30% of the bills are affected. It's estimated by officials that sorting the bills by hand could take 20-30 years. While sorting using a mechanized system may cut the time down to just one year.

Fed officials are working with staff from Crane and Co, suppliers to the US government of currency paper since 1879, to solve the problem. Crane and Co. have denied that the paper they supplied is the cause of the Fed's troubles.

Although the Bureau is now looking into automated inspection to find the defective bills, it does seem strange that, apparently, they don't already use an automated inline full press sheet inspection system.

Printing, inspecting, and packaging of defective $100 bills at the U.S. Federal Bureau of Engraving and Printing.

This problem means that the Federal Reserve will not have sufficient inventories to begin distributing the new $100 notes as planned and will instead be printing more of the old style bills in order to meet demand. One only hopes that the Fed will implement more stringent quality controls when reprinting the old style notes.
The old style bills will be pressed back into service until the defective new bills are found and destroyed.

"I didn't fail the test, I just found 100 ways to do it wrong."
Benjamin Franklin - whose portrait graces the $100 bill was one of the Founding Fathers of the United States and a noted author, inventor, and most importantly a printer.

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