Researchers: Japanese army used private paper mill to counterfeit Chinese bills in war

The Imperial Japanese Army used a private sector company to produce an abundance of counterfeit banknotes that helped to advance Japan’s front lines in China during the Second Sino-Japanese War, a recent discovery shows.

Researchers at Meiji University studied 279 sheets, each about 30 centimeters square, that were left at Tomoegawa Co.’s paper mill in Shizuoka. They concluded that the sheets were part of the army’s operation to fake banknotes used in the Republic of China during the war.

The army’s Noborito institute in Kawasaki had placed an order for the sheets with the Tokyo-based company. This suggests the army institute was involved in not only developing biological weapons, balloon bombs, toxins and other confidential defense technology but also in counterfeiting money.

The remains of the army institute are now preserved as the university’s Noborito Institute Peace Education Resource Center, which opened in 2010 in Tama Ward.

According to the researchers, the sheets showed watermarks of a profile of Sun Yat-sen, the Chinese revolutionary and founding father of the Republic of China. They also contain silk fibers.

These features are identical to those of a 5-yuan banknote that was widely circulated in the Republic of China at that time.

Other sheets found at the mill had watermarks of the Temple of Heaven, a historic structure in Beijing, that appeared on a different kind of 5-yuan bill back then.

A former Imperial Japanese Army officer who was in charge of the counterfeiting project wrote in a postwar book that the operation had created fake bills worth 4 billion yuan since its start in 1939.

Akira Yamada, professor of modern Japanese history at Meiji University, said it had long been thought that paper for the fake bills was produced only at the army institute because of the highly confidential nature of the operation.

“Having a company in the private sector involved in the project made it possible to make a vast volume of banknotes,” said Yamada, who is also head of the Noborito institute. “Japan was able to expand its battle lines in China apparently because it could secure supplies to continue fighting with a wealth of forged banknotes.”

The sheets were produced between August 1940 and July 1941, the researchers said, citing the letters printed on them.

There were also signs that workers ensured the bills looked authentic by checking the sophistication of the watermarks and the amount of silk fibers used.

According to the Noborito institute, authentic banknotes used in the Republic of China were printed in Hong Kong using technology from the United States and Britain.

Former employees with the army institute have testified that the machines and original plates to print the bills in Hong Kong were confiscated and taken to the institute after Japan occupied Hong Kong in 1941.

Some historians said the army facility was unable to produce as many fake bills as Japan had hoped for. It was located on a hill, making it difficult to secure a steady water supply for the production of the paper.

The researchers’ findings came after they sent inquiries to companies that had business dealings with the army institute, which was inaugurated in 1937.

Most of the army institute’s facilities and documents were destroyed when Japan was defeated in 1945.

This article was originally written by Nobuyuki Watanabe and published January 6, 2015 on the Asahi Shimbun website.

This is a guest article. The thoughts and opinions in the piece are those of their author and are not necessarily the thoughts of the Certified Collectibles Group.

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