It could be the most costly printing error in U.S. history: over US$100 billion worth of redesigned $100 bills are currently being quarantined and may be destroyed because government printers failed to churn out usable currency. New high-tech notes, which were scheduled for release in February 2011, were designed with advanced security features, including a 3-D security strip to stave off counterfeiters. But the complex production process they require rendered a crease in an unknown number of the new bills, leaving a blank portion that is revealed when the bill is tugged on both ends.
The source of the printing problem is unknown, but one official familiar with the situation told CNBC that “the frustration level is off the charts.” These new $100 bills were to be the first to carry Treasury Secretary Timothy Geithner’s signature. Now, in order to prevent a $100 bill shortage, the Federal Reserve has ordered more of the low-tech variety, which features Bush-era treasury secretary Hank Paulson’s signature.
The questionable cash, which represents more than 10 per cent of the entire supply of American currency in the world, will be held in vaults at Fort Worth in Texas and in Washington until the government figures out how to sort the bad bills from the properly printed ones.