If you have looked at the most recent $20 bills from the U.S. Bureau of Engraving and Printing, you know that they have an army of security features designed to make counterfeiting more difficult. The most obvious of these features is the "20" in the lower right corner written in color-change ink. There's also a security strip embedded in the paper to the left of Andrew Jackson that is visible if you hold the bill up to the light. Other new features include micro-writing, a watermark and very closely spaced lines (for example, behind Jackson's face) that are harder for a counterfeiter to reproduce.
All of these features are nice, but no store clerk is going to stand and hold each $20 bill he or she receives up to the light to check for a security strip! It takes too long and it is not a flattering pose to strike...
The counterfeit detector pen solves the biggest counterfeiting threat today. It used to be that a counterfeiting operation used expensive presses and special inks and papers to create exact duplicates of the bills. Today, the threat is much more mundane -- people with color copiers and color printers try to create passable facsimiles of a bill. They are not trying to make an exact copy. They are trying to create something close enough that people won't notice anything if they give the bill a passing glance. These folks are not particularly careful or meticulous, so they copy or print onto normal, wood-based paper.
The counterfeit detector pen is extremely simple. It contains an iodine solution that reacts with the wood-based paper to create a black stain. When the solution is applied to the fiber-based paper used in real bills, no discoloration occurs. The pen does nothing but detect bills printed on normal copier paper instead of the fine papers used by the U.S. mint.
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