Fake cash is flooding Scotland with the value of counterfeit notes now at record level

Scotland is being flooded with fake money as the amount of counterfeit cash seized reaches record levels.

Banks have confiscated illegal notes worth at least £5million, with the number detected doubling and values at new highs.

Forgeries of £20 and £50 notes have shot up, according to the latest figures from the Committee of Scottish Bankers (CSB), and make up the majority of the 171,593 fraudulent notes taken out of circulation last year.

The Federation of Small Businesses yesterday said the ‘high number of counterfeit notes in circulation is a clear risk to small businesses’. And retail industry leaders warned that ‘ultimately the cost of such crime is borne by customers’.

It is a criminal offence to possess or use a bank note that is known to be a forgery.

Counterfeiters and banks are locked in a constant battle, with designers of notes inventing ever more elaborate security features and materials to stay ahead of criminals trying to print their own money.

While only a fraction of the money circulating in Scotland is fake, the amount seized last year was the highest on CSB records going back to 2014.

Last year, just over £5.1million of fake currency was removed from circulation by the banks.

In 2022, £3.2million was taken out of supply, the second highest figure on record.

The amount of counterfeit money identified has grown significantly within the past decade. In 2014, only £1.3million was detected by banks.

Despite the rapid rise in digital payments, cash still makes up around one in every five transactions. In Scotland, some 500,000 people are still reliant on physical money.

Stacey Dingwall, head of policy and external affairs for Scotland at the Federation of Small Businesses, said the organisation viewed cash as an ‘essential part of the economy despite an increase in digital payments’.

She added: ‘Many small businesses rely heavily on cash; it provides a form of commerce to less digitalised businesses, acts as a check on pricing fees of card transactions and as a back-up for when digital methods go down.

‘While there are signs of recovery, margins remain extremely tight, and a high number of counterfeit notes in circulation is a clear risk to small businesses, including those in the retail, hospitality and leisure sectors, who continue to face significant trading challenges.’

David Lonsdale, director of the Scottish Retail Consortium, said that ‘despite an uptick in counterfeit notes, these account for less than one in every 2,000 notes in circulation’. He added: ‘Ultimately the cost of such crime is borne by customers.’

Last year, a record 171,593 counterfeit notes were detected by banks, with the number more than doubling from the year before when there were 85,236 illicit notes. 

In 2023 the most common forgery was a £20 note, with 115,166 seized, worth £2.3million .

Meanwhile, there were 56,092 illegal £50 notes withdrawn, worth £2.8million.

A specialist unit in the National Crime Agency is tasked with tackling the counterfeiters, but it has warned that sophisticated gangs are operating in linked networks to produce fake currency.

While one group may produce notes, another will finish them by adding security features such as foil, with another gang doing the distribution.

A Clydesdale Bank spokesman said: ‘There are lots of ways to identify counterfeits by checking them against genuine features such as the hologram and colour-shifting inks.

‘If in doubt, we recommend consumers or retailers check the note against another that they know is genuine and if they suspect a fake note, to hand it in at a police station or their bank.’

The Royal Bank of Scotland, the Bank of Scotland, and the National Crime Agency were approached for comment.