Has De La Rue Already Printed the Post-Euro Currencies?
by Peter C Glover  /  Jun. 04, 2012

Rumours that British firm De La Rue Currency, the world’s largest banknote printer, has started printing drachmas in anticipation of Greece’s euro exit have been rife for a while. However, I have received information that a De La Rue insider confirms that not only has the Hampshire-based company printed drachma, it has already printed substantial reserves of all 17 pre-euro banknote currencies, including the Deutschmark.

While there is no way of independently verifying this it would make sense for a number of reasons. Not least the inevitability that ‘somethings gotta give’ and soon in Euroland. And no one can predict the extent of the economic fallout. De La Rue’s CEO Tim Cobbold has already stated that to print new currency in the space of a couple of weeks “would be impossible”. Indeed the sheer number of banknotes required to replace a national currency requires strategic forward planning. It would not be at all surprising therefore if a currency Plan B was in place in the event of a euro break-up, or in lieu of an exit by the Greeks. And I am advised that De La Rue is currently in an even higher state of information lockdown than usual.

There is little point in asking De La Rue. They have a long-standing and strict policy of never commenting on their currency printing arrangements. CEO Cobbold would only, as he has done before, point out that most Eurozone states have their own printers. True enough. But De La Rue has the advantage of a solid history of high security and its printing press is outside prying Eurozone eyes. Given that news of an official sanctioning of the printing of pre-euro currencies would likely create a run on European banks already teetering on the brink of crisis, keeping tight-lipped about contingency arrangements is hardly surprising. And there is background that lends support to the view that anyone looking for a good investment could do a lot worse than consider how well-placed De La Rue is to cash in on the meltdown of the European single currency.

De La Rue is a half a billion pound operation that prints banknotes and other security documents, including passports for 150 countries. As recently as 2011, the discovery of “production irregularities” at De La Rue caused it to lose some market credibility, a key customer (India), and its then chief executive. Rumours of a takeover by French rival Oberthur surfaced. As a listed UK company, De La Rue’s economic fortunes remain unchanged for a number of years. Since last year that has begun to change.

With the arrival of new CEO Tim Cobbold, De La Rue’s market stock has stabilised and steadily risen. But it was Cobbold’s reference to “a strong pipeline of opportunities” in the group’s annual results published in May that sent the currency whispers into overdrive. The company admits that its order book has increased by 14 percent to £248 million, but it won’t reveal details. Operating profits are also currently up post-tax by 56 percent. At the beginning of this year a further formal bid of £9.35 from Oberthur was again rebuffed. Just a few months later De La Rue’s shares are trading just above the £10 mark. Even so, investors considering De La Rue for a quick killing on the back of the euro crisis should be warned it would not be without risk. Even if oodles of pre-euro currencies are sitting in De La Rue’s warehouse in southern England, the EU has a history of making political decisions aimed at keeping the ‘European Dream’ alive at almost any cost to its constituent states and its taxpayers.

Meanwhile the chorus for a new economic arrangement is growing by the day. The latest voice calling for a Plan B for the eurozone is that of Mario Draghi, President of the European Central Bank. Draghi has lately made it clear that the current set up for the euro is “unsustainable”. Just how far EU and Eurozone leaders will go to sustain Plan A remains unclear. And that means that investors considering a swoop for De La Rue shares could still get their fingers burnt, printed pre-euro currencies or not.

But, as former UK PM Maggie Thatcher famously pointed out, “The trouble with socialism is that eventually you run out of other people’s money”. The moment the Germans pulled the life support system plug on the profligate southern socialist states, the writing was on the wall. Indeed, Belshazzar’s mene, mene, Tekel u-pharsin is a more than an apt analogy for a collapsing empire and its centrally planned economic system weighed by market forces – and found wanting.

De La Rue shares have staged a recovery since scandal struck in 2010
Return of drachma could be good news for De La Rue
by Toby Green /  15 May 2012

While markets were panicking over the future of the euro yesterday, not everyone appeared so worried. Trading screens may have been swamped in red, but De La Rue managed to climb amid suggestions that the banknote printer could be in the money if the eurozone breaks up. The group ticked up 31.5p to 1,024p as dealers speculated whether it may find itself in line for new contracts if currencies need to be revived. Back in November, De La Rue’s boss, Tim Cobbold, said the crisis “can create opportunities for us” although he refused to go into great detail.

Some of the more cautious voices in the City argued that Greece’s size meant a return to the drachma may not be that lucrative, while Mr Cobbold has pointed out that the country has its own state-owned printer. However, Panmure Gordon’s Paul Jones – who called De La Rue “a good stock for political turmoil” – argued that even if De La Rue did not win the contract it “would be a beneficiary”, saying that “the knock-on effect would probably be to tighten the market given the speed of printing necessary”.

At the same time traders were pointing out that the group – which rejected two takeover bids from France’s Oberthur in 2010 and 2011 – would get a boost if the Bank of England decides that another round of quantitative easing is required The fears over Greece saw the FTSE 100 slump 110 points to 5,465.52, a new low for 2012. With the benchmark index now having given up 6 per cent in just eight sessions, Capital Spreads’ Angus Campbell warned that the “likelihood of [a Greek government] being able to steer the country through the crisis whilst staying in the euro is very slim”.
Banknote printer won’t be drawn on drachma rumours
De La Rue refused to confirm rumours it was printing drachmas in case Greece leaves the eurozone
by Josephine Mould  /  29 May 2012

Banknote printer De La Rue said a strong performance in currencies drove underlying profits up 73% last year, but refused to confirm rumours it was printing drachmas in case Greece leaves the eurozone. Chief executive Tim Cobbold said: “There are 200 countries in the world. Every country doesn’t order every year. This year there are orders for customers we didn’t supply in a previous year.” Forward orders for currencies at the year end in March rose 18%, compared with long-term growth in the banknote market of 4%.

De La Rue is still recovering from a scandal in 2010 when employees were found to have falsified certain paper specification test certificates for a limited number of customers. Its then-chief executive and several managers subsequently resigned and profits tumbled. Cobbold said on Tuesday morning that “discussions remain ongoing with the principal customer concerned”, previously identified as the Reserve Bank of India. He said the dispute was taking longer to settle because the company had to deal with a government who “have a whole series of pressures on them”. Last summer De La Rue introduced a so-called improvement plan, closing two facilities, which resulted in 200 job losses. Asked whether there would be any further job losses, Cobbold said: “Largely we have been through the actions on the improvement plan.” He said the company was making “good progress” with the plan and is on track to hit its target of over £100m operating profits next year.

Full-year pre-tax profits fell by 55% to £32.9m as a result of a one-off boost to profits last year from the sale of De La Rue’s stake in Camelot, and the one-off costs of implementing the recovery plan. But underlying pre-tax profit rose to £57.7m and revenues were up 14% at £528m. Chairman Nicholas Brookes will retire in July, handing over to Philip Rogerson, 67, who is also chairman of Bunzl and Carillion. Cobbold said: “[Rogerson] joined the board on March 1. I can only say from the time he’s given since then that I’m very confident he will have the time to dedicate to De La Rue.” The company will pay a final dividend of 28.2p on 2 August, making the total dividend 42.3p, the same as the previous year. The shares slipped 7p to £10.02.
UK banknote printer readies for Greek call – source
by Neil Maidment  /  May 18, 2012

De La Rue (DLAR.L) has drawn up contingency plans to print drachma banknotes should Greece exit the euro and approach the British money printer, an industry source told Reuters on Friday. The news comes as EU trade commissioner Karel De Gucht said on Friday the European Commission and the European Central Bank are working on an emergency scenario in case Greece has to leave the euro zone – the first time an EU official has confirmed the existence of contingency plans. The source, who asked not to be named, said that as a commercial printer De La Rue needed to be alive to the possibility of a Greek exit from the single currency and prepare accordingly.

Crisis-hit Greece will be led by an emergency government into new elections on June 17 which will ultimately determine whether it must quit the euro – possibly spreading financial devastation across the continent. An exit from Europe’s single currency would spark a major demand for the returning drachma and while the country’s state printers could orchestrate its production, a handful of global firms like De La Rue could be called on to help. Buffeted equity investors looking for respite from the Greek turmoil have been busy buying up De La Rue shares in anticipation, helping push them up 11 percent in the last month.

Panmure analyst Paul Jones said the firm would be in with a chance of work if extra capacity was needed and could also benefit from other work as Greek printers were less likely to be quoting for contracts elsewhere. “If they (Greece) decide to pull out of the euro the first thing is it won’t be an overnight job, partly because of the implications of what they are trying to do but secondly because of the sheer number of banknotes that are needed to replace a currency,” Jones told Reuters. “It will be a huge job which the state printing works will do, but they will probably pull in some additional volume from outside and De La Rue will be in with a chance.” On Thursday, as rating agency Fitch downgraded Greece’s debt a further notch below investment grade to CCC, a poll showed Greek voters returning to pro-bailout parties, offering some encouragement to markets shaken by the prospect of a euro exit.

De La Rue, the world’s largest commercial banknote printer producing over 150 national currencies, told Reuters in November that regime changes and the euro zone crisis could fuel further growth for the group. Shares in the FTSE-250 firm, which has not produced drachma in over 20 years, were up 0.3 percent at 994.5 pence by 11:20 a.m., outperforming a 0.8 percent weaker FTSE 250 midcap index .FTMC.

Staff at De La Rue falsified data for quality control tests on banknote paper


The Serious Fraud Office has been called in by currency printer De La Rue after the company discovered that employees faked the results of quality control tests on paper used for banknotes. The company admitted in July that it had uncovered ‘quality and production irregularities’ at a plant producing high-security paper. Last month, chief executive James Hussey abruptly quit, declaring he had to take responsibility for the debacle. And yesterday, De La Rue announced that following an investigation, the managing director of its currency business and another senior employee had quit.

‘The company has reported its findings to the relevant law enforcement agencies,’ said De La Rue. According to rel iable sources, the Serious Fraud Office has been asked to monitor De La Rue’s internal inquiry. The company is using law firm Herbert Smith to help find out what has been going on. De La Rue said yesterday that ‘some of the company’s employees have deliberately falsified certain paper specification test certificates’. It insisted that in a ‘small number’ of cases, paper used in banknotes was not up to scratch. Paper was shipped to customers before De La Rue realised that the results of quality control tests had been faked.

De La Rue £1bn note
Our De La Rue £1bn note features these details: 1. RAF airdrop of notes printed by De La Rue. 2. The Park Lane Hotel: the company regularly entertains ambassadors and diplomats in London. 3. Company founder Thomas de la Rue. 4. Spies: the world of espionage has often crossed paths with De La Rue. 5. The fall of the Shah of Iran. 6. Former boss James Hussey’s university, Oxford. 7. De La Rue’s Overton plant. 8. US troops guard the arrival of Iraqi currency. 9. £1bn: The estimated company value in June this year

What went wrong with the British company with a licence to print money?
by Adam Luck /  16 October 2010

It was a brilliant British success story: the impeccably well-bred banknote makers with a licence to print money in 150 countries – and are a retinue of former MI6 men to throw a cloak and dagger at upstart rivals. And then De La Rue decided to cut corners…

The Boeing 747 banked over Baghdad Airport before entering a steep dive, levelling up at the last moment and touching down on the runway. A line of U.S. military Humvees and armoured personnel carriers, flanked by more than 80 heavily armed infantrymen, fanned out across the Tarmac. Their job was to protect one of the most secretive cargos to be landed in the aftermath of the allied invasion of Saddam Hussein’s Iraq. They hadn’t been told that 90 tons of freshly printed Iraqi dinars, remarkable for not bearing the head of the deposed dictator, were stacked in the hold of the specially adapted jumbo; only the British sales executives who’d arrived with the steel crates of vacuum-packed notes were privy to that information. The troops simply ferried the crates into the vehicles and drove in convoy to the sanctuary of Baghdad’s Green Zone, while Apache helicopters hammered out a steady drumbeat above. Once the cargo had arrived in the Green Zone it was broken up and dispatched to various ‘secure’ points around the country to be dispersed. The notes were designed to kick-start the paralysed Iraqi economy. They were also a powerful symbol of President Bush’s determination to wipe the slate clean. But it wasn’t just the Americans who’d pulled off a coup in Iraq; this was a significant moment for the British company that printed the notes. The new Iraqi dinars had been flown in from the UK and were the work of one of our most daring and secretive institutions. De La Rue had been handed the $120 million contract to make the high-security, counterfeit-resistant notes by the U.S.-led Iraqi administration with good reason. The company supplies banknotes to over 150 countries across the world and has brokered deals in some of the most volatile nations on the planet.

Former De La Rue chief executive James Hussey
Former De La Rue chief executive James Hussey resigned in mid-August

De La Rue’s personnel are used to danger and secrecy. The company has routinely employed former military specialists, many of them linguists with an intelligence background, and has close ties with the Foreign Office and the Secret Intelligence Service, MI6. In the world in which they operate, murders, coups, espionage and dirty tricks are routine. De La Rue was a true British world leader and, with its licence to print money, was worth nearly £1 billion in June this year. But that was before disaster struck. Production of banknote paper at its dedicated plant was halted in July; a month later its chief executive James Hussey, an Old Etonian and godson of the Queen, resigned; and then it emerged staff had falsified test certificates that were meant to prove the paper was up to scratch. Three months later, De La Rue is worth a third less, around £650 million, and the company is now facing the mother of all battles for its future. The sprawling industrial complex of Overton Mill, overlooking the Hampshire village of Overton, abuts the north side of the railway line from London to Salisbury. Security at De La Rue’s paper-production plant borders on military-grade, as one might expect of the factory that makes the security paper for all Bank of England notes, euro notes and scores of other currencies. The squat gatehouse has thick bulletproof glass. Double sliding gates and two layers of high-security fencing keep out prying eyes. Access to the most highly sensitive areas, such as research and development, are controlled by iris-recognition cameras. Most staff only have clearance for their specific work area and nothing more. All are carefully vetted by an internal security department, which scrutinises bank statements, mortgage contracts and previous employment history to ensure none are apparently living beyond their means and therefore vulnerable to blackmail or temptation. Mobile phones are strictly forbidden inside, principally to prevent photographs being taken. The heart of this most mightily secure of operations is a series of giant wire-mesh drums, 6ft high and 6ft wide. Resembling out-sized Catherine wheels, they’re the starting point for an impressively rigorous production process. The wheels dip down into industrial baths containing millions of strands of cotton fibre, pick up the fibres and revolve to drain them of water. The layers of pulp that remain are then compressed into large sheets, rolled and dried in a series of procedures, each requiring verification and the completion of a test certificate. In this process covert security features are added, the most sensitive being the watermark. Each customer will have their own specifications; anti-counterfeiting measures incorporated in the paper will broadly reflect the budget of the client. (The Bank of England specifications are particularly exacting, with notes undergoing additional checks before being shrink-wrapped.)

De La Rue's Debden plant where bank notes are printed for The Bank of England.De La Rue’s Debden plant where bank notes are printed for The Bank of England. Security borders on military-grade

Once the security paper is ready, it’s transferred to the similarly well-protected printing plant at Debden in Essex. Here the sheets are fed into a German-made and Swiss-designed ‘Super Simultan’ press, which prints the background images and designs for both sides of the notes. The ‘Super Giori’ machine is then fed 10,000 sheets at a time, each sheet yielding 40 to 60 notes depending on their size. The portrait of the relevant monarch or state principal and the denomination are printed on each note, with 300-400,000 produced per hour. They’re then passed onto the ‘Foiler’, which inserts the thin strip of foil used in British notes as another anti-counterfeiting measure. The fourth stage sees the sheets fed into a rotary numbering machine, which applies serial numbers via ink-covered barrels; finally they’re fed into a ‘cut-pack machine’, with 100 sheets going in one end and 1,000 shrink-wrapped and sequentially numbered bundles of individual notes emerging from the other. Throughout, a number of inks are used, including fluorescent and UV ink, as well as OVI, or optically variable ink (which displays different colours depending on the viewing angle). Less well-known features include ‘see-through registration’, allowing a note to be checked for precise alignment between the printing on each side; micro-lettering and fine lines that ensure photocopies come out blurred; and ‘intaglio’ elements – the raised writing and ridges you can feel on the surface of notes. Confidence in the quality of De La Rue’s security paper helped it to post impressive annual results earlier this year. Profits and sales were up. But in late July, the company stunned the market by revealing it had ceased production of a type of banknote paper in Overton. The company cited ‘quality’ issues and said production and shipment of the paper had been halted while it investigated the problem. Its shares dropped 16 per cent.

Iraq’s bank notes made by De La Rue. Saddam Hussein had his done in China, replacing him on the note is non-political Abu Ali Hasan Ibn Al-Haithan

In mid-August, Hussey resigned after taking ‘responsibility’ for the unfolding disaster. Shares dropped by a further 12 per cent. Weeks later De La Rue revealed that an internal investigation had uncovered evidence that staff had been guilty of falsifying test certificates. The implications were profound, even if De La Rue insisted the paper in question was nothing to do with sterling or euros. The fear is that some of the substandard paper may have got into circulation, allowing counterfeiters to understand the security measures by comparing the high-quality paper to the poor quality. They could then exploit the weakness to produce their own notes. De La Rue has attempted to shrug off the security implications. After the company’s own internal investigations, the Serious Fraud Office was informed. And if shareholders weren’t already concerned at the prospect of an SFO investigation, they were then warned the affair was likely to cost the company at least £35 million. Shares dropped a further three per cent. In an industry where quality, reliability, reputation and discretion, not to mention secrecy, are fundamental to success, it couldn’t get much worse for De La Rue. ‘In the highly developed world of banknote printing, secrecy is paramount, because none of the central banks want their super anti-forgery device talked about,’ says banking expert Michael Jones, who was a senior executive at the Bank of England. ‘They don’t even want anyone to know the devices are there; it doesn’t matter if it’s in the paper or printing. You can’t underestimate the impact this will have on De La Rue and its business.’

Murders, coups and billion-pound banknote deals

Thomas de la Rue set up shop as a stationer and printer in London in 1821. The Guernsey-born businessman initially specialised in playing cards, but tax and postage stamps soon followed. By 1860 the company was printing its first banknotes, for Mauritius. Excluded from printing Bank of England banknotes because it zealously kept production in-house, De La Rue focused on the Empire, and when colonies gained independence, it was well placed to profit. World War II also offered the company the chance to build ties with exiled governments. Yugoslavs, Greeks, Czechs, Poles and Norwegians paid their resistance fighters in notes printed by De La Rue and flown in by the RAF in cloak-and-dagger operations. ‘In many ways the perfect cover for James Bond would be as a De La Rue salesman,’ says analyst Paul Jones from broker Panmure Gordon. Indeed, many of the firm’s staff have worked for MI6. ‘There was one man at De La Rue who I knew was with the intelligence agencies,’ says a former De La Rue executive who, like all his contract-bound colleagues, cannot be named. ‘He’d disappear for months at a time on leave sanctioned by the company. Apparently he has specialist skills, but I never found out what they were, where he went or what he was up to.’ By the late Fifties the company had 10,000 employees working in 24 plants in 14 countries. And throughout the next 30 years the company’s fluctuating fortunes echoed the rhythms of boom and bust in its traditional markets. By the turn of the millennium, however, De La Rue was suffering in the face of competition from German rival G&D (see below), and three outsiders were brought in as chief executive in quick succession to turn the business around.

Then in 2003 De La Rue won a seven-year contract to take over the running of the Bank of England’s printing plant in Debden, Essex. It also won the contract with Iraq. As the decade drew to a close results and prospects started to improve, but there were also plant closures both here and abroad. Many experienced staff left, and those still around were often asked to assume multiple roles. By the time James Hussey was appointed chief executive in 2009 the workforce had shrunk to barely 4,000. Hussey was a De La Rue man to the core and is one of the best-connected businessmen in London. His father was Marmaduke Hussey, the former BBC chairman, and his mother Lady Susan Hussey is a lady-in-waiting to the Queen, as well as a godmother to Prince William. Every summer De La Rue executives play host to their banker clients at Wimbledon in the company’s hospitality suite. In June the company also holds its famously discreet Ambassadors Reception at London’s Dorchester hotel. This has long been regarded as one of the high points of the diplomatic calendar, with as many as 200 ambassadors, diplomats, politicians, top brass and bankers gathering for a banquet and speeches. Before World War II, royals and Prime Ministers were regular visitors, and De La Rue was renowned for the presents it handed out to guests. In one case each guest was presented with monogrammed gold cufflinks.

De La Rue's Overton printing plant in Hampshire
De La Rue’s Overton printing plant in Hampshire, where staff were found to have falsified test certificates. The fear is that some of the substandard paper may have got into circulation

But the event has also attracted the wrong sort of attention. In 1982 the Israeli ambassador Shlomo Argov was shot and paralysed by followers of the notorious terrorist Abu Nidal after leaving the reception. The incident provoked Israeli Prime Minister Menachen Begin into launching his country’s invasion of Lebanon. For De La Rue, Hussey’s appointment signalled a return to not just old money, but also the old school. His patrician charm, however, belied his drive and ambition, and many claim he countenanced no contradiction. When he announced results in May this year Hussey appeared to have good reason to be pleased. Revenues had increased 12 per cent to £561 million and profits before tax stood at £97 million. The currency division, which prints the notes, contributed over 73 per cent of total revenues, and banknote-paper production had risen three per cent in the year. It was then that disaster struck at Overton. To compound the problems, the paper affected was destined for India and one of De La Rue’s biggest clients, the Reserve Bank of India, which is believed to account for up to a third of the company’s profits. One industry insider said, ‘There was a lax management culture, and below senior-management level, people were doing things that were detrimental to the business. They were cutting corners.’

An air of obsessive secrecy surrounds De La Rue to this day. One of the world’s most eminent experts in banknote printing and security paper, Rudolf van Renesse, refused to even comment on the controversy, simply noting, ‘I will get into trouble with my friends.’ De La Rue’s strict hierarchy meant that few people were prepared to speak out, and as a consequence, falsifying certificates became routine. The Overton paper mill was running at close to capacity. Managers and staff found themselves under immense pressure to get the paper printed and out of the gates, at any cost. One source close to the company told Live that De La Rue simply couldn’t achieve the paper-security specifications required by the Reserve Bank of India. ‘The implication is that this problem arose because of commercial pressures,’ says Paul Jones. ‘They cut corners to make sure the contract was fulfilled. Now you have to wonder what else has been going on within the company.’ De La Rue has admitted that ‘the full impact on the current-year financial results and on the group’s prospects has yet to be determined. You have to remember that these countries will have perhaps a 12-month contract with De La Rue and there will probably be penalty clauses built into those contracts,’ adds Jones. ‘They will have breached the contract, because the shipments have been delayed. When that contract comes round for renewal, what do you think the clients will be saying? They’ll be asking for a discount, or they may decide not to renew at all.’ The Indian bank has already sent over a high-level delegation to the Overton plant, and is now talking about making its own paper. Both the Bank of England and the European Central Bank are expected to follow with delegations of their own. But De La Rue doesn’t only have to worry about its clients. Its competitors are watching, and with its share price and credibility on the slide, it’s increasingly vulnerable to a takeover ‘This is a mature market,’ says Jones. ‘The demand for banknotes will surely decrease over time, and you can see the argument for consolidation. Competitors may look at De La Rue and may well be prepared to take a bit of a chance.’ At one point De La Rue toyed with the idea of taking over its long-term rival G&D, but its approach was rebuffed by the Germans, who bristled at the idea of being consumed by a British company. The irony is that the Germans could yet end up printing Bank of England notes. This, after all, can’t be any more far-fetched than a British company printing banknotes for Iraq.

People waiting outside a Tripoli bank
People waiting for money outside a bank in Tripoli
How did Libyan money come to be printed in Britain?
by Chris Summers / 2 September 2011

The RAF has delivered £140m worth of Libyan banknotes back to the country after the downfall of Colonel Muammar Gaddafi. But why is so much foreign currency printed in the UK? It is perhaps unsurprising that De La Rue, the British firm which printed the 280 million Libyan dinars (£140m) returned this week, is somewhat reticent about its business. The banknotes were ordered by the Gaddafi regime a year ago but were seized following the imposition of sanctions by the United Nations. When the rebels reached Tripoli and overthrew the Libyan leader, the UN agreed to lift sanctions and unfreeze some of the $20bn of assets the Libyan government had in the UK. A total of 1.86 billion dinars (£929m) would be returned. Foreign Secretary William Hague said: “The bank notes will be used to pay the wages of Libyan public sector employees, including nurses, doctors, teachers and police officers.” The cash will also be used to restock depleted cash machines across Libya.

Increasing demand
Pira International, a world authority on the print industry, said the global banknote trade was enormous. A total of 150 billion banknotes were printed last year, which is likely to rise to 162 billion this year and carry on rising, partially driven by increasing demand for cash in booming China. Pira’s chief consultant on print security, Michael Chamberlain, said 84% of the world’s banknotes were printed by state-owned enterprises – but the remaining 16% included 76% of the world’s currencies. Many countries, including Britain, the United States, Russia and China, will not allow their notes to be printed abroad. The US dollar is printed at two federal government-owned sites, in Washington DC and Fort Worth, Texas. But many smaller countries approach De La Rue or its main rival, Giesecke & Devrient. The German firm’s customers include Japan, Cambodia, Croatia and Guatemala. But De La Rue, based in Basingstoke, Hampshire, produces 150 foreign currencies as well as passports, driving licences and identity cards for several nations.

Old Libyan banknotes
Libyan banknotes carry the image of fallen leader Colonel Gaddafi

De La Rue was founded in Guernsey in 1813 by Thomas De La Rue, originally printing newspapers and later postage stamps before turning to paper money. It began printing money for foreign countries in 1930, when Chiang Kai-Shek’s Chinese nationalist government put in an order. Since 2003 it has also been producing Bank of England banknotes, from a printing plant in Debden, Essex. But the company refuses to give details of its overseas customers and a spokeswoman told the BBC: “We are bound by confidentiality with our customers and we have to respect their wishes not to have publicity.” There is no international body for the regulation of currency issue, which means there is nothing to stop companies printing money for “rogue states” like Syria or North Korea, or “emerging” states like Somaliland or Western Sahara which are not universally recognised.

Security threads
Mr Chamberlain said: “These states don’t have difficulty getting their money printed. The Chinese might do it, or the Russians.” De La Rue is fairly tight-lipped about their operations but it does admit to having plants in Loughton, Essex; Gateshead, Tyneside; and Bathford, Somerset. It uses security threads and holography as well as special security paper to defeat the counterfeiters. Some countries are happy to admit their banknotes are printed by De La Rue. One of them is Samoa in the South Pacific. De La Rue printed tens of thousands of notes for the Central Bank of Samoa, which introduced its new currency in 2008. Leasi Papali’i Tommy Scanlan, who stepped down recently as the bank’s governor, recently told De La Rue’s company magazine: “Counterfeiting was one of the biggest problems we faced with our previous banknote issue. “This is one of the main reasons we decided to issue a new series of banknotes, incorporating the latest security feature.” Counterfeiting is a lot harder nowadays.

A man holds up a Saudi banknote
Saudi Arabia is one of many countries which use De La Rue to print their notes

In the 1940s Adolf Hitler used a group of concentration camp inmates to create fake sterling banknotes in an attempt to destabilise Britain’s economy. Last month a set of fake notes from that wartime operation were put up for auction in Shropshire. There have also been allegations that North Korea has been printing fake US dollars, although the dollar is much harder to counterfeit than it was 10 years ago. Technology has moved on a great deal in the last 70 years and De La Rue has cornered the market. It also makes electronic identity cards for Rwanda and passports for Malta, Qatar and the Bahamas.

Regime change
Another banknote customer is Saudi Arabia, which uses the face of King Abdullah Bin-Abd-al-Aziz Al Saud on all denominations except the 500 riyal. The Saudi king and Queen Elizabeth II are not the only heads of state to be used on banknotes, but it can be a problem when there is a regime change. For the next couple of years Libyans will just have to put up with carrying around notes bearing the likeness of their fallen leader, just like Iraqis did with Saddam Hussein. Mr Chamberlain said: “They will have to use them but the new government is probably already thinking about issuing a brand new currency with the appropriate message on it.”

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