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Anatomy of a double denomination error

By Peter Huntoon and Lee Lofthus

During August 2014, coauthor Lofthus located a file labeled “Errors in Printing FR Notes” among Federal Reserve Board records preserved in the National Archives while we were working there.

Six $10/$5 double denomination notes including this one were found at the Peoples Savings Bank and Trust Company of Wilmington, N.C., and hit the news in January 1932.

Six $10/$5 double denomination notes including this one were found at the Peoples Savings Bank and Trust Company of Wilmington, N.C., and hit the news in January 1932.

The file with respect to six Series of 1928A $10/$5 Richmond double denomination errors was so complete, we are providing herewith without additional comment the self-explanatory transcripts of the key documents. You will see that tracing this error ultimately involved many of the highest officials in the Department of the Treasury. Terrific insights on the workings of the Bureau of Engraving and Printing appear as well.

What follows began with an inquiry by a press correspondent:

Frederic J. Haskin
Correspondent
Haskin Information Service
21st and C Streets, N. W.
Washington, D. C.
October 28, 1932
Federal Reserve Board
Washington, DC

We have received a question regarding an article that appeared in January, 1932 in the local press, stating that six paper bills bearing a $10 marking on one side and a $5 numeral on the other were received in Wilmington, N.C. by the Peoples Savings Bank from the Federal Reserve Bank of Richmond, Va.

The clipping states that the bank officials returned these greenbacks to the Government.
Recently a banker in Wilmington said that he still has six bills from the Federal Reserve Bank printed as $10 tender on one side and as $5 on the other.

Can you inform us regarding the disposal of these bills, as a correspondent wants to know whether all of these bills were returned or whether the banker really has some of them.

Yours truly,
Frederic J. Haskin

v v v

Federal Reserve Bank of Richmond
November 9, 1932
Mr. W.S. Broughton
Commissioner of the Public Dept
Treasury Department
Washington, D.C.

Dear Mr. Broughton:

As the matter referred to in your letter of November 5th was originally handled by the writer, Mr. Dillard has passed me for reply your letter of that date.

Under date of January 26, 1932, the Peoples Savings Bank and Trust Co. of Wilmington, N.C., wrote us in part as follows:

“We have in our possession Federal Reserve notes of the Fifth Federal Reserve Bank of Richmond, Series of 1928A, Nos. E04744279A to E04744284A, inclusive, the faces of which are in denominations of $10.00 each. The backs of these notes have the engraving of the $5.00 bill thereon…one of the tellers discovered these new Federal reserve notes mentioned above”

We at once communicated with the president of the Wilmington institution, Mr. J. Holmes Davis and requested the return of the notes in question. To this communication Mr. Davis promptly replied in part as follows:

“…in regard to six $10.00 Federal reserve notes with the backs engraved as fives which we have in our possession, and in reply beg to advise that we would prefer keeping the bills.”

The matter was therefore dropped by us without further communication with the Wilmington institution.

About that time there appeared in some of the newspapers a news article bearing the Wilmington, N.C. date line, reporting the fact that the Wilmington bank had located six notes with faces and backs of different denominations. We do not know as to what disposal has been made of the notes in question since the above referred to January exchange of letters.

I hope that this is the information you desire.

Yours very truly,

Geo. Keesee
Cashier

v v v

Federal Reserve Bank of Richmond
November 17, 1932

Dear Mr. Keesee:

This will refer to your letter of November 9, 1932, regarding six notes of the Federal Reserve Bank of Richmond held by the Peoples Savings Bank and Trust Company of Wilmington, with $10 faces printed on $5 backs.

With the information contained in your letter a further investigation has been made. It seems that in October 1929, while printing $5 faces for the Federal Reserve Bank of Chicago, a sheet of $10 backs was printed, but discovered in subsequent examination in the Bureau. An audit of the paper in process resulted in no discrepancies being found and it was concluded that a compensating misprint had been made, and that $10 faces were printed on $5 backs. You letter confirms the finding then arrived at.

The notes reported by the Wilmington bank were numbered on November 9, 1929. In numbering Federal reserve notes the series of numbers is continuous, but the job is broken in the middle, the first half of the numbers being assigned to the left-hand subjects on the sheet, and the second half of the numbers being assigned to the right-hand subjects on the sheet. The numbers of the notes reported by the Wilmington bank are on the right side of the sheet. The corresponding numbers on the left side of the same sheet, were E04672279-84A and were shipped on November 21, 1930 (200,000 notes, Nos. E04540001A-E04740000A) to the Assistant Federal Reserve Agent at Charlotte. The notes reported by the Wilmington bank were included in a shipment sent to your bank on November 24, 1930.

It might be of interest to learn from the Assistant Agent at Charlotte to what bank the notes bearing Nos. E04672279-84A were delivered.

Very truly yours,
Wm. S. Broughton
Commissioner

v v v

Federal Reserve Bank of Richmond
November 18, 1933
Mr. W. S. Broughton
Commissioner of the Public Debt
Treasury Department
Washington, D. C.

Dear Mr. Broughton:

I have your letter of November 17 in regard to the six $10 Federal reserve notes held by the Peoples Savings Bank and Trust Company of Wilmington, N.C. with the backs printed as $5. You suggest that we ascertain from our Charlotte Branch if is possible to learn the name of the bank to which the offsetting misprints could have been delivered. With respect to that I will say that no record is maintained by us or by our branches as to the serial numbers of the bills paid out over the counter or shipped to the miscellaneous banks of the district, so that it is not practical to attempt any run-down of sources through which these corresponding misprints could have been distributed.

Very truly yours,
Geo. H. Keesee
Cashier

v v v

Commissioner of the Public Debt
Treasury Department
Washington, D. C.
October 27, 1933
Memorandum to Mr. C. Morrill
Secretary of the Federal Reserve Board

Regarding the alleged erroneous printing of notes of the Federal Reserve Bank of Richmond concerning which Frederic J. Haskin addressed an inquiry to the Federal Reserve Board and which was referred to this office, a resume of the developments in the case is given for your information.

On October 28, 1932, the Haskin Information Service made inquiry on behalf of a correspondent regarding six notes of the Federal Reserve Bank of Richmond alleged to be printed with $10 faces and $5 backs and held by a bank in Wilmington, N.C.

Inquiries were directed to the Bureau, the Auditor, and the Federal Reserve Bank of Richmond. With my memorandum of November 5, 1932, I enclosed a copy of a memorandum from Mr. Hall, a copy of the Department’s letter to the Federal Reserve Bank of Richmond, and a copy of the Department’s reply to Mr. Haskin.

The Auditor reported that examinations of currency paper in the Bureau of Engraving and Printing had disclosed no such misprinted sheets for the Federal Reserve Bank of Richmond, but called attention to an adjustment made in July 1930 on account of a misprinted sheet of notes for the Federal Reserve bank of Chicago.

Upon investigation, it was found that in October 1929, while printing notes for the Federal Reserve Bank of Chicago, $5 faces were imprinted on a sheet of $10 backs, but detected in subsequent examination in the Bureau. To complete the printing order for Chicago, a sheet of $5 Uniform Backs for United States Notes was used. The stocks of $5 and $10 backs were examined by the Bureau and no offsetting error was found. The misprinted sheet of $5 faces on $10 backs was delivered as mutilated as a sheet of $10 denomination, corresponding to the denomination for which the blank paper was drawn. At this point the Bureau was short one sheet of $5 Uniform Backs for United States Notes, and over one sheet of $10 Uniform Backs.

An audit made by the Division of Public Debt Accounts and Audit in June 1930 confirmed the Bureau’s findings, and it was concluded that a compensating misprint had been made, that a sheet of $10 faces had been printed on $5 backs, and delivered either into circulation or as mutilated, without being detected. Following this confirmation an adjustment of the paper accounts was authorized in July 1930. The Bureau being credited with one sheet of $5 Uniform Backs for United States Notes and charged with one sheet of $10 Uniform Backs for note of the Federal Reserve Bank of Chicago.

The reply from the Federal Reserve Bank of Richmond dated November 9, 1932, copy of which was sent your office with my memorandum of November 10, confirmed the conclusion previously arrived at. The letter stated that on January 26, 1932, the People’s Savings Bank and Trust Company of Wilmington, N.C.., wrote they had in their possession six notes of the Federal Reserve Bank of Richmond, numbers E04744279A to E04744284A, inclusive, of Series 1928A, with $10 faces and $5 backs. The return of the notes was requested and the Wilmington bank replied they preferred to keep the notes.

With this information a further investigation was made, which disclosed that on November 9, 1929, the Bureau numbered 12,000 sheets (144,000 subjects) of $10 notes for Richmond, beginning with serial number E04632001A, and ending with serial number E04776000A. Federal reserve notes are printed as 12 subject work and the series of numbers is continuous, but the job is broken in the middle, the first half of the numbers being assigned to the left-hand subjects on the sheet (E04632001A to E04704000A), and the second half of the numbers being assigned to the right-hand subjects on the sheet (E04704001A to E04776000). The numbers of the notes reported by the Wilmington bank were on the right-hand side of the sheet and were included in a shipment to the Federal Reserve Bank of Richmond on November 24, 1930. The corresponding numbers on the left-hand side of the same sheet were E04672279A to E04672284A, inclusive, and were included in a shipment in the Assistant Federal Reserve Agent at Charleston, N.C., on November 21, 1930. This information was conveyed to the Federal Reserve Bank of Richmond under date of November 17, 1932, with the suggestion that they communicate with the Charlotte Branch to ascertain, if possible, to what bank the notes bearing numbers E04672279-84A, inclusive, were delivered. Their reply dated November 18, 1932, advises that no record is maintained in either the parent bank or branches as to the serial numbers of bills paid out over the counter or shipped to banks of the district.

Since no other misprints have been discovered with respect to Federal Reserve notes, the circumstances described indicate that a sheet of $10 Uniform Backs was used to print $10 faces for Richmond. The sheet for Chicago was discovered, cancelled and destroyed as mutilated. The paper accounts were adjusted upon the premise that a sheet with $5 backs and $10 faces had either been sent out and placed in circulation or had been destroyed as mutilated without detection, the former being more likely. It later developed that a sheet with $5 backs and $10 faces did get out which supported the premise upon which the adjustment in paper accounts was authorized and made. Of such sheet six notes went to Richmond and six to the Charlotte Branch of Richmond without the misprint being discovered and so far as known, all the notes were put in circulation and are still outstanding. If subsequent information is obtained, you will be advised.

Wm S. Broughton
Commissioner

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The following double denomination notes from this group have passed through various Heritage auction sales.

Date of Sale        Sale                    Lot    Price

E04744279A
Feb 2005    Dallas Signature    15479    $19,550
Sept 2007    Long Beach    15233    $34,500
Jan 2011    Tampa FUN    15932    $25,300

E04744281A
Apr-May 2009    Cincinnati CSNS    14296    $37,375

E04744282A
Sept 2006    Long Beach    18202    $43,125

Source of correspondence

Records of the Federal Reserve Board (1913-1954), Errors in Printing FR Notes, record group 82, box 2602, file 610-3 (locator 82:450/65/1/1+/box 2602), U.S. National Archives, College Park, Md.

This article was originally printed in Bank Note Reporter.
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More Collecting Resources
• The Standard Catalog of United States Paper Money is the only annual guide that provides complete coverage of U.S. currency with today’s market prices.
• The Standard Catalog of World Coins, 1801-1900, 8th Edition is your guide to images, prices and information on the century’s coins.

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