Iran may be pushing bogus super dollars

Iran allegedly has printed millions, perhaps billions, of counterfeit American dollars on state-owned printing presses that Americans trained Iranians to use.

Circulated by terrorist organizations in the Bekaa Valley of Lebanon — with at least tacit Syrian approval — these high-quality $100 bills represent more than just easy money for the counterfeiters. According to informed sources, they are part of a concerted effort to undermine U.S. currency.

The "superbills" represent "a new face of terrorism and illegal activity that go together," according to Professor Yonah Alexander, director of George Washington University's terrorism studies program.

While the U.S. government largely has downplayed the threat, the General Accounting Office last month released a report claiming that "in the Middle East, a group, allegedly a foreign government, is sponsoring production of the Superdollar" — a bill of exceptionally high quality that has turned up as far away as South Korea and Moscow.

So far, the GAO noted, there is little public evidence to support these allegations.

The House Republican Task Force on Terrorism and Unconventional Warfare provided one of the few public studies on the Superdollar. Cited by GAO in its report, the task force concluded two years ago that between $100 million and several billion in fake dollars are in circulation.

Printed in the Middle East on "high-tech, state-owned presses with paper only acquired by governments," the report alleged, the Superdollar is "designed for direct infiltration into the U.S. banking system and has become a major instrument in facilitating the flow of militarily useful nuclear materials and equipment and various weapons systems."

More detailed analysis has been generated privately. Neil Livingstone, a Washington, D.C.-based expert on terrorism and national security, said bogus $100 bills began showing up in the early 1990s.

According to intelligence sources, Livingstone reported previously, the origin of the problem can be traced to assistance provided by the United States to the Shah of Iran in the early 1970s. Responding to counterfeiting problems that threatened to undermine Iran's currency, the United States sent representatives from the Bureau of Engraving and Printing to Tehran to reform and improve the printing of the shah's currency.

"Now, two decades later, some of the same individuals who received training from the United States are believed to be using their skills to counterfeit $100 bills for the radical Islamic regime presently in power in Iran," Livingstone said.

Early reports about Middle East counterfeiting were dismissed as propaganda, according to Living-stone. Some in the U.S. government went so far as to accuse him and others of "beating the drum for Israel."

The topic has been hot recently, not only in the media but in Congress, after the Treasury Department announced it would issue newly de-signed $100 bills later this year. Although the de-partment denied the decision was based on any specific threat — like the counterfeit Superdollar — the move stirred much speculation.

On Feb. 27, a House Banking and Financial Services subcommittee discussed the GAO report. Patrick Clawson, a senior research professor at National Defense University, speculated but could not confirm that Iran is sponsoring the counterfeiting of U.S. dollars.

According to Livingstone, the Superdollar is printed in Iran but distributed in Lebanon's Bekaa Valley — a safe haven for all sorts of illegal activities — by terrorist organizations including Hezbollah and Islamic Jihad. The area is under the control of Syria.

Passed in the Far East, Superdollars have turned up in Hong Kong, Macao and South Korea. Livingstone said that while visiting South Korea in 1994, government officials there told him that "Middle Easterners" had been apprehended for passing bogus $100s at Korean stores and recreation areas. Others reportedly have turned up in Russia and Latin America.

According to Frank Cilluffo, senior analyst at the Washington, D.C.-based Center for Strategic and International Studies, this counterfeiting is a form of economic warfare.

"We are starting to see a change in the face of terrorism," he said. "This is clearly an attempt to undermine the world's confidence in U.S. currency. This also supports programs to obtain weapons of mass destruction."