Counterfeit Detection: China 1940 20 Yuan

Founded in 1933 in Wuhan, Farmers Bank of China was one of the “big four” note-issuing banks in China in the 1930s. Amid the chaos of the Second Sino-Japanese War, the bank was forced to relocate in 1937 further inland to Chongqing, which served as China’s capital after its major cities in the east were occupied. The bank lost its authority to issue notes in 1942 as that power was consolidated elsewhere amid severe inflation.

Genuine China, Farmers Banks of China 1940 20 Yuan Click images to enlarge

In its decade of issuing notes, the bank produced some beautiful paper money, including the 1940 20 Yuan, which is known by its catalog number of Pick# 465. The PMG Population Report lists more than 750 examples, most of them in Uncirculated grades, where they typically sell for hundreds of dollars. PMG recently received a submission of a purported example of Pick# 465, which it identified as counterfeit.

Counterfeit China, Farmers Banks of China 1940 20 Yuan Click images to enlarge

Genuine notes are printed with an intaglio process that involves incisions in the plates to hold the ink. The counterfeit shows signs that its printing was of an inferior quality. For example, the details on the counterfeit are muddier, which is especially noticeable in the leaves of the trees and the surface of the water.

Close-ups of the front of the genuine (left) and counterfeit note Click images to enlarge.

The inferior printing process is evident on the back of the note as well. Note the fuzziness in the titles under the signatures as well as the loss of quality in the intricate patterns that form the border of the note.

Close-ups of the back of the genuine (top) and counterfeit notes Click images to enlarge.

The counterfeit note was printed with a modern, four-color lithographic process, in contrast to the intaglio process that was used on genuine notes. As a result of the intaglio process, the ink on the genuine note sits above the surface of the paper, which is clear when the note is viewed under side-lighting. When similar lighting is used on the counterfeit, the ink appears to blend into the surface of the paper.

Close-ups of the front of the genuine (top) and counterfeit note under side-lighting Click images to enlarge.

When you are spending hundreds of dollars to add a paper money rarity to your collection, it is important to get it certified so you know that it is genuine. Keep in mind that PMG backs its determinations of authenticity and grade with the PMG Guarantee.

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