Security Lax for New $100 Bills at Printing Plants, Audit Says

The U.S. government left millions of $100 bills inadequately protected at a currency-printing plant with windows that lacked security features, the Treasury Department’s inspector general said.

About 54.4 million new $100 bills and 4 million uncut sheets of notes had “inadequate security” at a Bureau of Engraving and Printing plant in Washington, according to the inspector’s report released today. The audit also criticized security at the bureau’s Fort Worth, Texas, facility.

The finished bills were “wrapped in protective plastic, but were not stored in a locked security cage,” the audit said. As of January 2011, some notes had been stored in the production area for more than nine months even though finished notes usually “are moved to a secure, limited-access vault shortly after production.”

The production area had 26 windows that lacked “protective security features,” the report said. The $100 bills also were at “increased risk of theft and loss” because about 225 employees had access to the production area, compared with 21 workers who are allowed into the vault.

In a response included with the audit, the bureau, or BEP, said it would move bills and sheets that weren’t yet finished into vaults. Still, the money was always safe, it said.

“After careful consideration, and based on multiple compensating controls, such as cameras, access control systems, locking mechanisms, etc., the BEP stored finished notes in highly secure space,” the bureau said.

Last year the Treasury was forced to delay the debut of $100 bills due to printing errors. The new design, aimed at thwarting counterfeiters, has several new security features, including a “3-D Security Ribbon” and an image of a bell on the front that, when tilted, changes in color from copper to green.

To contact the reporters on this story: Robert Schmidt in Washington at rschmidt5@bloomberg.net; Ian Katz in Washington at ikatz2@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

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