Error Note Chronicles: Watermark Errors

Posted on 5/23/2023

Let's shed some light on these fascinating mistakes that can be difficult to spot on notes.

Paper Money Guaranty® (PMG®) is the world’s leading authority on banknote errors, a popular segment of numismatics. In Error Note Chronicles, we take an in-depth look at different errors. This month’s topic is Watermark Errors.

Watermarks are a cheap and highly effective anti-counterfeiting tool that have been used for more than three centuries. They are embedded into the paper during its creation and can be seen when held to the light. Many banknotes incorporate a watermark window within their design specifically for this feature. Watermarks come in a variety of designs, including the bauhinia flower on this Hong Kong note.

On the Hong Kong, China - Government of Hong Kong 2002 10 Dollars, the watermark window at left reveals a flower.
Click images to enlarge.

Banknotes are printed on sheets of paper, but if this paper is oriented for the printing press incorrectly, then a watermark error can occur. An example is this PMG-certified 1996 $100 Federal Reserve Note (New York) with an Inverted Watermark Error. The watermark on the front of this note is an image of Benjamin Franklin and it is supposed to appear at the right. But on this note, it appears upside-down at the left. The security thread also switched locations due to the error. This particular note is being offered in a Heritage Auctions sale on June 6, 2023 (and it can be found here).

1996 $100 Federal Reserve Note (New York) with an Inverted Watermark Error graded PMG 65 Gem Uncirculated EPQ
Click images to enlarge.

Watermark errors also occur on world notes, such as this China / People's Republic 1980 10 Yuan with a Misplaced Watermark Error graded PMG 64 Choice Uncirculated. The way the notes were printed resulted in the watermark not appearing in the blank area. This particular note realized $1,440 at a Heritage Auctions sale in July 2022.

China / People's Republic 1980 10 Yuan with a Misplaced Watermark Error graded PMG 64 Choice Uncirculated
Click images to enlarge.

A watermark error can also occur if the watermark is missing from the banknote entirely. This Bulgaria, National Bank 1990 50 Leva graded PMG 35 Choice Very Fine has a Missing Watermark Error. Given the subtle nature of watermarks, it is no surprise that errors like these can be missed in the quality control process.

Bulgaria, National Bank 1990 50 Leva with a Missing Watermark Error graded PMG 35 Choice Very Fine
Click images to enlarge.

PMG, an independent member of the Certified Collectibles Group® (CCG®), has certified many exciting error notes, including the famous “Del Monte” error note that realized $396,000 in a January 2021 sale.

Collectors and dealers with error notes can submit them to PMG for certification under an applicable grading tier with “error” or the specific error noted under the Variety/Pedigree column on the submission form. There is no additional fee for this service.

For more information about submitting to PMG, visit

Other Error Note Chronicles columns:

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