HERITAGE: U.S. ERROR CURRENCY SHOWCASE

As most US currency collectors know, the US Government began issuing Large Size paper money in 1861 to help finance the Civil War. The notes were printed through the National Bank Note Company and American Bank Note Company, both in New York. These companies were joined by the National Currency Bureau in 1863, which became the Bureau of Engraving and Printing in 1869. In these early days, every step of the printing process needed human hands. Each step was closely monitored from beginning to end to produce attractive, quality banknotes and to avoid releasing errors and misprinted notes into circulation. This hands-on approach with repeated inspection resulted in very few Large Size Errors reaching circulation. The few that escaped unnoticed would become numismatic collectors' trophies once discovered.

In the early years of the Bureau of Engraving and Printing, notes like the 1917 $1 Legal Tender with an Inverted Back Error seen above, started as a sheet of paper that was run through a roller press which transferred ink from an engraved steel plate onto the paper. Printing was done in three stages, first the back was printed, then the face, and finally the seals and serial numbers were added, with inspection of the print and drying of the ink required after each print stage. Once the sheets were printed, inspected, and fully dried, they were cut into individual notes and sorted before being sent to the issuing banks for circulation. This frequent handling throughout the printing process provided high assurance that few mistakes were made. Consequently, these rare error notes have become quite valuable. The highest price realized for a Large Size Inverted Back Error was a Fr. 1187 $20 1922 Gold Certificate PMG Choice Uncirculated 64 EPQ which realized $16,800 in 2020.

Typically, when errors occurred in the midst of a run of notes, one of the BEP employees would remove the misprinted piece and order a replacement for that note or sheet. Replacement notes were printed with a star incorporated into the serial number to serve as a marker and maintain a proper account of the total issue. While some errors are common, errors on star or replacement notes are much rarer. A 1906 $20 Gold Certificate Star Note Inverted Back Error realized $17,625 - the highest price realized for a Large Size Star Note Error.

Missing Printing or Partial Printing Errors on Large Size US Currency are also extremely rare. The Bart reference describes just two large-size examples that exist. Both were auctioned in our January 2022 FUN auction, a $500 Gold Certificate which realized $11,400, and an 1862/3 $10 Legal Tender which brought $6,000. Perhaps less rare, but more exciting are the Double Denomination Errors. The highest price realized on a Double Denomination note was when this Kansas City, MO - $50/$100 Double Denomination 1882 Brown Back Fr. 512 The Aetna National Bank Ch. # 4251 realized $70,500 in 2015. Error enthusiasts' favored Double Denomination Errors can be found on both Large and Small Size notes. Because of the hands-on nature of the early printing process, Large Size Errors entered circulation less frequently than Small Size Errors, which were first introduced into circulation in August 1929. Hand-operated presses were still used, albeit less often than before. The BEP began using sheet-fed rotary presses in 1957, increasing production to 32 notes per sheet, with the first currency printed using this technique being the 1957 series of Silver Certificates. Direct human handling of the notes dwindled as printing was automated. Consequently, the number of errors slipping into circulation increased, as BEP employees no longer inspected every note being printed.

The new system created new types of errors including mismatched serial numbers, like the one above, inverted overprint errors, offset errors, and doubled printing errors. One stand out example, a Doubled Second Printing Error Fr. 1974-G $5 1977 Federal Reserve Note, realized $22,800 in January 2021. The more dramatic the error, the more these happy accidents can fetch at auction. Error notes are yet another fun way to engage in the paper money hobby and fascinate yourself with the foibles of banknote production. Be sure to check out the exciting array of Large and Small Size Error notes in our upcoming November 16 U.S. Error Currency Showcase Auction.

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