Money andNegotiable Instruments

Presented by

Alka Mehta , Center for Professional Development

Kari Jordahl,

Instructional Design Consultant

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Introduction

Credit union members trust their credit union to take good care of their money. Your credit union’s reputation depends on the ability of employees to handle cash transactions safely and accurately.

The term “negotiable instrument” refers to fi nancial documents that represent cash and can be converted to cash upon demand. The most common forms of negotiable instruments are checks and drafts, written by individuals and businesses. Members may use other forms as well, including money orders, cashier’s checks, certifi ed checks and drafts, and traveler’s checks. These specialized checks guarantee the payee that the amount will be paid on demand.

CashAs Americans rely increasingly on debit and credit

cards, will we see a “cashless society” some day? That seems unlikely. Cash is still a common and convenient way to make purchases. Unlike debit and credit cards, cash is accepted everywhere. Some people prefer to pay in cash because it ensures their privacy—they don’t have to give names or show identifi cation.

As a credit union employee, you must be familiar with the designs and features of U.S. currency. Paper money has undergone many design changes. There were major redesigns of Federal Reserve notes in the 1990s, and again in 2004, primarily to make it more diffi cult to forge paper currency. Only the one- and two- dollar bills remain much the same, because those notes are rarely counterfeited.

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Keep in mind that older versions of all notes remain in circulation. The Federal Reserve removes bills with older designs from circulation as they wear out, but you will still encounter those bills, so you must be able to identify them as authentic currency.

ObjectivesIn this Training on Demand course, you will learn

how to prevent fraud with proven methods for detecting counterfeit money and recognizing bad checks. You will learn how to improve effi ciency and accuracy by understanding the methods for handling cash and accepting deposits, as well as handling share drafts and traveler’s checks.

The objectives for this course are to: • Describe security features to identify

counterfeit bills; • Describe the methods for handling cash and

accepting deposits to improve effi ciency and accuracy;

• Identify common signs of bad checks;• Describe proven methods for preventing fraud;

and• Describe the precautions you must take in

handling share drafts and traveler’s checks.

How Can You Identify Counterfeit Bills?

Let’s start by focusing on cash and some of the issues with cash which include counterfeiting.

In the past, counterfeiters needed access to elaborate printing and engraving equipment.

With the widespread availability of digital scanners, color copiers, and printers, counterfeiting is easier than it once was. In fact, Secret Service agents have dubbed counterfeit bills “P-notes” since they are often generated with computers and inkjet printers.

There are several features and materials used in new currency that help to thwart counterfeiters.

• Paper texture and fi bers;• Portrait printing quality;• Printing details;• Security thread;• Microprinting;• Watermark; and • Color features.

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