The Fed is returning more than 30 million new $100 bills to the agency that makes U.S. currency due to a printing error known as "mashing."
Call it a big misprint.
The Federal Reserve, racing to meet an October deadline for introducing a redesigned $100 bill into circulation, is returning more than 30 million new $100 notes — a grand total of $3 billion — to the Bureau of Engraving and Printing because of a printing imperfection.
A bureau spokeswoman told The New Yorker that too much ink was used during printing of some of the notes, so the lines of artwork aren't as clear and crisp as they should be. The problem is known as "mashing."
A Federal Reserve spokeswoman told MSN News on Thursday: "It's our policy that Federal Reserve banks don’t accept Federal Reserve notes that don’t meet the quality control standards agreed to by the Federal Reserve and the Bureau of Engraving and Printing."
The New Yorker report cited a July memo from Larry Felix, the bureau's director, who said recent batches of cash from the bureau's Washington plant contained "clearly unacceptable” bills intermixed with passable ones.
The entire batch has to be reinspected, though it's expected most of the bills will be cleared and returned to the Fed for circulation.
In a statement Thursday to MSN News, bureau spokeswoman Darlene Anderson said "less than 0.5 percent" of the notes returned to the bureau were affected by mashing. "The affected mashed notes were intermixed with a substantial amount of good, quality notes," she said.
The bureau said despite the latest snafu, it still expects the new $100 bill to be released on time by Oct. 8.
The redesigned bill will have new security features such as a blue, 3-D security ribbon that will be easier for the public to authenticate but more difficult for counterfeiters to replicate, the Fed says.
The new design for the $100 note was unveiled in 2010, but its introduction was postponed following an unexpected production delay blamed on a printing error, separate from the mashing error, in which some notes were left with a blank spot, according to the New Yorker.
There's no tally yet on what the printing miscues will wind up costing taxpayers.
"Taxpayers will have to pay to inspect, correct, produce, transport, and secure all the additional money that will replace the botched notes. Disposing of the bad bills? That’s on taxpayers, too, as are the additional hours spent making up for the mistake by employees of the bureau,” the New Yorker article stated.
During fiscal 2012, the Bureau of Engraving and Printing delivered approximately 35 million notes a day with a face value of approximately $1.5 billion.
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