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Capitalism Creates New Criminals: Counterfeiters

July 6, 1993

MOSCOW (AP) _ As Russia forges a capitalist economy, a new breed of criminals is busy forging U.S. dollars, Russian rubles and privatization vouchers, police said Tuesday.

In the first five months of this year, Russian law enforcement agencies recorded 783 cases of counterfeiting - 112 more than in the previous five years combined.

In the move toward a free market, Russia has legalized foreign currency trading, produced a dizzying variety of its own new banknotes, and opened up trade with the West.

One result is that it is much easier for forgers to slip fake bills into circulation.

At a news conference called by the Interior Ministry to warn the public, the deputy head of the ministry’s economic crime department, Maj. Gen. Mikhail Serdyuk, said 20 million rubles and $500,000 of bogus banknotes have been seized so far in 1993.

In addition, he said, police have confiscated 19 million rubles worth of fake privatization vouchers - the certificates that President Boris Yeltsin promised last year to distribute to every citizen to buy shares in former state-owned companies.

″International forgers look at Russia as an unsaturated sales market for counterfeit money,″ Serdyuk said. ″The transparent borders with our neighbors make it easy for hard currency, starting with Pakistani rupees and ending in U.S. dollars.″

Already, wary Russian merchants refuse to accept foreign bills that are perfectly genuine but old, torn, discolored or just dirty. Tourists often find that rumpled $100 bills are rejected, even by banks and major hotels.

Inflation, which hit 2,500 percent last year, has forced Russia to print new ruble notes in ever higher denominations. In addition, the government has changed the color and size of some bills, and dropped the portrait of Soviet founder Vladimir Lenin from them.

The result is that the ruble now comes in 13 different denominations, and a total of 29 versions, making it harder for an ordinary consumer to recognize a fake.

For example, there is only one version of a 25-ruble note. But there are multiple versions of 100-ruble, 200-ruble, 500-ruble, 1,000-ruble and 5,000- ruble notes.

The new notes are particularly easy to forge because they lack watermarks and are cheaply made, said Vladimir Finogenov, banknote expert for Russia’s Central Bank.

Photocopying machines, a favorite tool of modern counterfeiters, were banned under Soviet rule to prevent dissemination of dissident literature. Now, the latest Western models are freely sold in Moscow.

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