SGM HERBERT A. FRIEDMAN (Ret.)

Note: this article was used with the authors permission as a reference source for the book: Japanese Invasion Currency Gregory Hale, Centaur Media, Australia, 2014. Images from this article were requested by the author of the book Surprising Spies due to be released in 2020. In June 2018, images of Philippine propaganda notes from this article were used in a presentation on WWII-era overprints at the International Paper Money Show in Kansas City. This article was mentioned in an issue of 'The E Asylum," the electronic publication of the Bibliomania Society, with the editor’s comment, "A fascinating numismatic specialty." In 2020, a request was received and approved to reprint this article in Romanian on the website Cjagora.com.

During the occupation of the Philippines, General Douglas MacArthur ordered the circulation of several hundred million counterfeit Japanese war notes to be used by the Allied Forces to support U.S. intelligence agents and by the Filipino resistance movement. Another purpose was to sabotage and wreak havoc on the economy of the Philippines during the Japanese occupation. The JAPWANCAP sought: reimbursement for the counterfeit JIM in its possession; redemption by the U.S. of the non-counterfeit JIM, and payment by the U.S. of its claims against Japan for the loss of human life and physical destruction.

The Japanese flooded the Philippine Islands with their worthless occupation currency during WWII. At the end of the war many Filipinos had thousands of pesos that were without value. In the hope that the money would be redeemed by the United States or the new Philippine Government, an organization called the Japanese War Notes Claimants Association of the Philippines (JAPWANCAP) began overprinting the notes in purple or black ink in 1953. The organization gathered and held the notes, provided receipts to the owners, and marked the notes with various stampings. There are four major shapes of overprints; a large oval (71 x 56mm), a small oval (59 x 36mm), a small fat oval (55 x 40mm) and a circular overprint (38mm). Within the four shapes, there are generally recognized to be nine texts, some with very minor differences. These are not propaganda overprints and they add no value to the banknotes. They are collectable only as a conversation piece and oddity.

The forgeries are very interesting. A number of the 1, 5, 10 and 100 peso notes are overprinted with a triangle with the text inside: Filipino  American  Chinese Guerillan Movement in the Philippines August 7, 1942. The overprints are in red and black ink. Another overprint reads BANZAI, also found with BANZAI and Japanese characters. Some of the notes have the words The Japanese Government Xed out and the word PHILIPPINES under the XXXXXXXX. Some of the notes simply have Japanese characters. Other fake overprints I have seen include PHILIPPINE AMERICAN GUERRILLA, FAC 6 MP, PAG, and PHILIPPINE AMERICAN GUERRILLA 1943. In 2009 a new set of fake overprints appeared with such comments as Soonest POW, MacArthur is here, and Defeat is near, etc. Let the buyer beware. In a 2013 auction two new overprints suddenly appeared: Asias Butcher and Ruthless. Apparently, a specialist could build quite a collection of these fake overprints.

There are at least 40-odd fantasy overprints applied to Philippine Japanese occupation currency by a curio shop in Manila. They are being sold for two or three dollars a set.

There are also reports of many other fraudulent overprints. The researcher C. M. Nielsen told me in 1985:

The notes known to have been overprinted are the 1, 5, 10, and 100 pesos notes. It is generally agreed that there are two styles of overprint. An enormous number of cheap imitations of the Co-Prosperity propaganda overprinted banknotes have appeared on the market. Most of these notes are uncirculated, the overprints in both black and a bright glossy red. They are still being sold in the Philippines to American tourists.

A short snorter is a banknote which was signed by various persons traveling together or meeting up at different events and records who was met. The tradition was started by bush pilots in Alaska in the 1920's and subsequently spread through the growth of military and commercial aviation. If you signed a short snorter and that person could not produce it upon request, they owed you a dollar or a drink (a short snort- aviation and alcohol do not mix!).

The 10 peso Philippine propaganda banknote above has Caroline Nelson of Penna. written on it. Sometimes these banknotes will have 20 or 30 such names. The roll that contained this banknote belonged to William E Murray, a gunner on a B-25 bomber during WW2 in the Pacific. Clearly, at some point he was stationed in the Philippines. His short snorter was over 150 bills long before being dismantled after his death. There was also a second note in this roll, a 1 peso Co-Prosperity Sphere piece with the signature of two individuals. All of the short snorter banknotes are damaged on both ends from the Scotch tape used to hold the roll together. The Short Snorter Project says about this topic:

Soldiers often collect banknotes from all the places they have been deployed as souvenirs of their travels. I have a pile of dollars, pesos, pounds, won, yen, MPC, etc., that I collected during my time in service. Because I was also a collector, I kept them protected and pristine. However, many soldiers that are not collectors use the notes as kind of a dairy which they call a short snorter. As they move from post to post they have their friends and comrades sign the banknotes and tape them together to make a roll. The bigger the roll, the more places you have been and the more pals you have.

Curiously, one of the Japanese occupation 10 peso Co-prosperity sphere overprinted banknotes was found mounted in an official Psychological Warfare Branch General Headquarters product album. The note placed in the book by the actual printers was without punch holes and this would seem to once and forever prove that the notes were officially printed by the U.S. Sixth Army in the Philippines and that they were not punched or holed in any way. What is interesting about this note is that it is also one of the early experimental notes that were not disseminated, probably a type 4. This indicates that although a better quality note was eventually printed and airdropped on the Japanese, some of the earlier test versions were still in stock and available as souvenirs for the troops and examples of what the PWB could produce .

So, in conclusion, what have all of these experts and authors told us? There were some occupation notes in Hollandia, Tacloban or the Philippines ; an American or an Australian thought up the idea of using them for propaganda; they were then overprinted in Australia or the Philippines , with or without rubber hand stamps, in two or three versions; punched or not punched with holes; and then they were dropped over Luzon or Luzon and Manila .

Miller says that there seems to be four general types of overprint in different sizes with the letters being of different height and width. Sandberg apparently destroyed the bulk of his experimental propaganda banknotes. It is curious that Sandberg says that the notes were not disseminated because of fear of Japanese reprisals. Since we know that the banknotes were disseminated, we might assume that because the Japanese were quickly driven back and in no condition to punish the Filipinos, the "authorized" leaflets were dropped two months later as stated by the PWB document quoted above. It must be remembered that these archived banknotes are trial runs to test the printing and color and were not disseminated. The actual disseminated overprinted banknotes were prepared and dropped two months later by Sixth Army PWB propagandists.

An experimental Type 3  Overprint. Notice that the type is so large that they could only print the second line

I, and probably others in a position to do so, took samples of the overprinted paper currency as souvenirs. A collection of what I took, along with the psychological warfare material used throughout the Pacific Theater is now in the archives of the University of Nebraska Love Library .

We soon heard that a large supply of Japanese occupation currency was stored in a local bank in Tacloban. We decided that it might be interesting to place taunting messages on those notes. A crude local press was being used to print the newspaper Free Philippines , so we decided to print a number of different overprints in different colors on the banknotes. They generally were some version of The Co-Prosperity Sphere, what is it worth? General MacArthur vetoed the idea, concerned that Filipino citizens might try and use the overprinted currency and be severely punished by the Japanese.

In October 1944 I was a Second Lieutenant in the Psychological Warfare Branch, General headquarters, Southwest Pacific Area, attached to the Fifth Air Force. Twenty days after we landed in the Philippine Islands , my four-man PWB team moved to the 308th Bomb Wing (North American B-25 Mitchell medium bombers) that we would use for leaflet missions. The airstrip was located by the provincial capital of Leyte Province , Tacloban.

Returning to the overprinted banknotes, Bob Miller later wrote a report of his findings and also copied the serial numbers of all the notes in the collection so that there would be a record of their provenance. He says that all of the banknotes he has are overprinted in red except one which seems to be rubber-stamped in violet. He says that they apparently tried some rubber stamps at first to see what the overprint would look like then went ahead and typeset the actual leaflets they hoped to disseminate. Some of the data that Lieutenant Sandberg told Miller is as follows:

When the Americans hit the beaches of the Philippine Islands on 20 October 1944, Bill and Peter were put on an LST and arrived at Leyte the day after the initial landings. He saw the entire battle of the Leyte Gulf and regularly dropped propaganda leaflets using C-47 Skytrain military cargo plane, B-25s and various fighter aircraft. He points out that most fighter pilots did not want to do leaflet missions (they had to fly low and slow and were targets for enemy anti-aircraft), but they did perform their mission. Leaflets were also sent to Tinian Island for dissemination by bombers, and Navy carrier planes dropped them on Manila and other targets. Bill also took part in the night drop of tactical leaflets on Manila in support of the U.S. Army Infantry and Cavalry units. Although he had no part in the printing of leaflets he did have some input into their content. He also took part in some loudspeaker operations, including one occasion in southern Luzon where he rigged an amplifier on the wings of a small two-man Stinson L-5 Sentinel observation spotter aircraft and flew over a tough Japanese unit dug into a deep canyon and broadcast surrender appeals from American Nisei troops. It was while in Luzon that Bill worked with Sandberg and Hallgren.

Bill Wooley was a member of the Psychological Warfare Branch who started as a U.S. Army Private First Class with the invasion of the Philippines and ended up as a Staff Sergeant by the end of the war. He had been recruited by the PWB about March, 1944, while in the Replacement Depot in Milne Bay , New Guinea . He was sent to Australia where he spent the next three months learning the art and science of psychological operations. He was then assigned to the Army Air Force 308th Bomber Wing in Hollandia , New Guinea , a unit flying the North American Billy Mitchell B-25 twin-engine medium bomber. He was teamed with a friendly Australian Warrant Officer named Peter Snow who treated him as an equal despite their difference in rank. They did more training there and Bill says he read a pile of military field manuals.

The first set of leaflets was designed to encourage the resistance of the Philippine population. The branch created a second series of leaflets in an attempt to weaken the morale of the Japanese troops in the area and urge them to surrender. Hallgren and Sandberg, who accompanied flights over Japanese troops, were able to drop these leaflets themselves. A third propaganda campaign targeted Japanese civilians in Japan.

Lieutenant Sandberg and Sergeant Hallgren were selected from among forty members of the newly established force (PWB) to become a two-man team to saturate the Philippine Islands with propaganda. When the United States entered into World War II, both men left Nebraska separately to join the U.S. Army. They ended up at the same replacement pool in New Guinea and both were assigned to the newly created Psychological Warfare Branch in the Pacific Theater. Unfamiliar with this type of operation, the U.S. Army turned Sandberg and Sergeant Hallgren over to the Australians and Dutch for training. The collection contains a variety of items, for the most part of American origin, but including a smaller quantity of Dutch and Australian leaflets and Japanese propaganda. The collection of these truly unique materials has been appraised at $23,000.

Some eight years ago, Robert Sandberg, then Vice-President of the University of Nebraska Foundation , and Frank Hallgren, UNL Director of Placement, donated to the University Library a valuable collection of documents vividly depicting the psychological warfare conducted by the U.S. Forces against the Japanese

The Feller theory is supported by stamp and coin dealer Bob Miller of Lyn-Co Stamp & Coin of Lincoln, Nebraska who told me that he had business dealings with J. Robert Sandberg, one of the officers that actually overprinted the notes. In 1983 Sandberg donated his wartime papers to the Love Library at Nebraska University . The University says about Sandberg:

A U.S. Army Soldier examines crates of brand new captured Japanese money stored in a vault in the Southern Development Bank in Manila, Luzon, P.I. in 1945.

The Fellers' comment has the ring of truth. We did capture a large stock of currency in Tacloban. There is a message known to have been made from partisan commander Colonel Fertig in Mindanao to MacArthur, in which the location of the currency was reported, along with a request that some of the paper money be forwarded for use by Fertigs intelligence agents.

Most of the U.S. Army leaflets to the Japanese had the alpha J. This leaflet has the alpha F which stands for Filipino. The code shows that this was the 10th leaflet in the series prepared for the use of the 6th United States Army. Some other leaflets from this series are 3F6 (American forces poised for next assault), 4F6 (Landing instructions), 5F6 (General Kruegers bomb warning) and 7F6 (Another strike in the battle for freedom).

According to Brigadier General Bonner F. Fellers, then in charge of the Psychological Warfare Branch of MacArthurs headquarters, some notes were overprinted in Tacloban, Leyte, by the Sixth U. S. Army and dropped by 5th Air Force planes over Manila and Central Luzon . A 7 December 1944 Psychological Warfare Detachment document from a microfilm of U. S. Army propaganda leaflets aimed at the Japanese depicts a 1-peso note with the Co-prosperity overprint and states that it was:

I should also point out that about once a month I get a letter from some veteran or child of a veteran who has found a piece of Japanese occupation currency in a drawer or old trunk. They always ask about the value of such a note. The answer is almost always the same. Your note has no real value. The Japanese printed and dumped them into the occupied countries in the millions. They were worth nothing when brand new and they are worth about the same 60 years later. In general, these old occupation banknotes are worth from about five cents to twenty-five cents. It is a nice souvenir of the war, nothing more.

If I may put it more strongly, a word to the wise. Frauds abound! It is likely that any such propaganda banknote offered today without an impeccable pedigree is bogus.

Beware of Co-Prosperity Sphere notes overprinted with thick, bright ink that has a silk-screened appearance. Original notes have well-printed overprints in dark red which is flat on the paper, just as the original lithographed inks used to print the backs are. No rubber stamps were used for original overprints.

These propaganda leaflets have been quite popular among collectors. Unfortunately a number of new varieties of these overprints have become available over the years. It seems certain that some of them have been produced to bilk collectors.

Soon after the liberation of the Philippines by the Allies a quantity of the Rizal Monument notes was discovered. A propaganda message was overprinted on the backs of these notes for distribution in other areas. The message The Co-Prosperity Sphere: What is it Worth? was intended to undermine Japan 's claim to have united the Asian peoples.

This is an interesting story although unverified. I have never seen it reported anywhere else. However, it could be true. When MacArthur reached Australia he wanted nothing to do with the American Office of Strategic Services and simply absorbed the Australian propaganda service. He had the experienced Australians teach his U.S. Army Psychological Warfare Branch members how to prepare and disseminate propaganda and added many Australians to the American units. The concept of the overprint could well be from an Australian, though the overprints themselves were definitely American-made.

When General MacArthurs forces returned to the Philippines in October 1944, they captured large stocks of Japanese occupation paper money. At that time Mr. Colin Kerr of Adelaide was working with the American Psychological Warfare Branch on Leyte Island . It was at his suggestion that the captured paper money was overprinted with the slogan The Co-Prosperity Sphere: What is it Worth? This was done by a hand stamp and later by portable presses. Some tens of thousands of these notes were dropped over Manila and other parts of the Philippines still in Japanese hands.

This last comment is probably in error. The notes he claims were shipped from Australia are most likely counterfeits meant to be used by guerrillas, and not the propaganda parodies we are discussing. The United States counterfeited a number of Philippine banknotes. For example, 15,000 100-peso notes of 1936 were counterfeited in one operation. These notes were to be used by the partisans. In another operation, 120,000 5 peso notes were counterfeited to be placed in aviators kits to help them survive if shot down over the Philippine Islands.

A former Office of Strategic Services (OSS) agent said, I met an Army Colonel who was in the Philippines and all of his Japanese currency is punched. This colonel claims he got these notes from MacArthur's GHQ in Manila . The agent, who made the transition from OSS to CIA agent after the war, went on to say, I understand from very good sources that the currency was flown out to Australia for overprinting, then brought back to the Philippines and given to the Black Squadrons for air dropping.

This note could have been prepared before the Philippine invasion from banknotes in stock elsewhere. Perhaps a test run? Very curious. Another major problem. The certificate is from the 98th CB Detachment. I had assumed because the owner was in Australia, the letter was from an Australian. The 98th CB is an American Naval Construction Unit. I checked their history and found that they left Hawaii on 20 October 1943. They were at Tarawa 23 November 1943. They later returned to Oahu and Maui, Hawaii. No deployment to the Philippines at all. In October, 1945, they were sent to Kyushu, Japan. By December 1945, they were disbanded. I have no idea exactly where or when the Seabee found the overprinted note. It is a mystery.

I agree that the Overprint is different. I definitely think it was done by hand, a rubber stamp perhaps. When you zoom in on the scan you can see the pattern in the ink and areas where there has been too much ink applied to the stamp, hence the two letters touching.

The story got even more confused when I heard from collector Stephen Gill who came into possession of a letter with a certificate of clearance signed by his unit commander dated 7 March 1944 allowing the sender to send five banknotes home. Among them was a Japanese ten pesos note overprinted on the back The Co-Prosperity Sphere: What Is It Worth? The note has the prefix PD and two punched holes at the top edge. This indicates once again that some punched notes definitely did exist. The date adds another problem though. The certificate is dated 7 March and that is before the notes should have been available. Of course, this might have been a blank form and the notes could have been added and mailed much later. Also, the overprint doesnt seem just right. It is cruder and the letters O and R actually touch. Gill adds:

As for the notes coming from the Hollandia bank vault, frankly, I'm dubious. It is not impossible, but extremely unlikely. This punching of holes is even more farfetched. If we captured so much occupation money, why not use it to supply the Philippine guerrillas? They would have appreciated some of the genuine stuff. The counterfeits we were sending them from Australia were so bad that they were afraid to use much of it. Plenty of Jap pesos were found in Leyte and Manila . Some 15 million in the Malacanang Palace safe alone. Some quantity was turned over to the Red Cross as souvenirs and these were punched with two holes to protect green American recruits who would sometimes accept this invalid currency as genuine. The only place that these banknotes are confirmed to have been dropped are Northern Luzon . If we had them earlier, why weren't they dropped on Leyte , etc?

Who did the overprinting? The answer depends on what book you read and who you believe. One former member of a Psychological Warfare Branch attached to the 8th Army in the Philippines stated that in Hollandia he liberated a bank that was filled with Japanese occupation currency. He claimed to have been involved with dropping roughly a million dollars in overprinted money over Manila to upset the Japanese economy. These notes were dropped by B-25 bombers drawn from the 32nd Bomber Group of the 13th Air Force. He claimed that his unit often punched holes in the propaganda notes so that they could not be used by the Japanese in areas they still controlled.

Vast sums of occupation currency were issued for use in the Philippines . As the war neared an end, huge stocks of these notes were found by advancing American liberation forces. A propaganda campaign to attack the Japanese political concept was launched by overprinting the captured occupation notes on the back with: The Co-Prosperity Sphere: What is it worth? These overprinted notes were air dropped over areas still occupied by the Japanese to ridicule their concept of a Greater East Asia by showing that Japanese-issued currency was worthless.

The vendors and customers had frequent altercations on the subject of what the former called Mickey Mouse money, also called by the provincial folks gurami, a species of fish that was abundant during the occupation Originally on par with the pre-war Philippine peso, the war notes soon lost their value until the more sanguine among the people exchanged their Mickey Mouse money at five to one at the beginning, and later, at something like five hundred to one By the end of 1943 the Mickey Mouse money was so low that it was necessary to bring a large bag of the money just to buy lunch at a downtown restaurant.

The Japanese produced a worthless occupation currency for use in the Philippines. It allowed them to buy valuable goods with paper dollars they could print at will. Teodoro A. Agoncillo mentions the peoples attitude toward these banknotes in The Fateful Years  Japans Adventure in the Philippines, 1941-1945 , Garcia Publishing Company, Quezon City, Philippines, 1965. He says:

The Japanese masked their imperialistic designs behind The Greater East Asia Co-Prosperity Sphere. This was an economic and political program meant to convince enslaved nations that they had been freed from colonial power. In reality, the program eliminated Western authority and substituted Japanese racial and spiritual superiority.

The story begins on 8 December 1941 Far East time, when Japanese military aircraft attacked airfields in the Philippine Islands . Successive attacks the following day virtually wiped out the American Air Force. On 10 December the Japanese landed troops on Northern Luzon . On 22 December the main Japanese invasion forces landed at Lingayen Gulf . The Japanese occupied Manila on 2 January 1942 after General MacArthur order the U.S. and Philippine Army forces to withdraw to the Bataan Peninsula . On 9 April 1942 Bataan fell. On 6 May 1942, General Wainwright surrendered Corregidor and all United States forces in the entire Philippines .

The American propaganda currency used in the Philippine Islands would appear to be an easy topic to discuss. To put it simply, we overprinted some Japanese occupation banknotes in an attempt to discredit the Japanese. The problem occurs when an attempt is made to discover the origin of this operation. A number of contradictory statements have been published. I will mention some of these opinions and let you choose that scenario you find to be most creditable.

We should mention that besides these propaganda parodies, the United States Office of Strategic Services counterfeited Burmese 10 Rupee notes and the British Special Operations Executive counterfeited Burmese 1 and 10 Rupee notes.

Since the end of WWII I never saw a single one of these propaganda banknote leaflets offered for sale until 2011 when two lots were offered. One lot bearing a single 5 rupee banknote leaflet sold for $197.50; the second lot bearing three such banknote leaflets sold for $372.57. Leaflets to Burma normally sell for about $25-35, so this shows the power of the numismatic collectors who saw these items as currency propaganda and not just as propaganda leaflets.

It is easy for the Japanese to print this money, but it shall not be so for the Japanese to make you accept these notes in exchange for your foodstuffs or your labor. Friends! Do not be cheated.

The paper notes, which you are being forced to accept and use are mere valueless scraps of paper printed by the Japanese.

The wicked Japanese authorities have secretly issued orders to all Japanese forces stationed in Burma to spend this money freely since it is being produced in great numbers to buy rations and to hire workers during the war.

For many years, the Kachin 5 rupee parody was believed to have been the only one used in Burma . In fact, the United States produced a similar leaflet in the Burmese language. I had Zan Yaw, a Burmese friend translate the note in 1980. In the box at left:

It is easy to get these notes but very hard to buy food or other things.

The Military Government is issuing currency notes for your [the Japanese] use in Burma . Spend as much as you like for food and other things, but don't tell the (Kachin) people the secret of the money.

The United States prepared a parody of the 5 rupee Japanese invasion money (JIM) banknote issued for use in Burma from 1942 to 1944. The original note is dark purple with a yellow background. There are a coconut palm at the left and a pawpaw tree and temples at the right. The genuine note bears the red code letters BA or BB. The American parody is similar on the front, even bearing the BB inscription. The back bears two propaganda messages in the Kachin language. I had Zan Yaw, a Burmese friend translate the note in 1967. In the box at left

Armed with his .45 and a magicians kit, he set out to recruit Kachins while Jap patrols were seeking out the mad American colonel, sometimes only a few miles away, Eiffler set up his show in the village square. He made coins disappear. Flowers grew out of pots before the eyes of the astonished audience. He drew cigarettes from the ear of the headman. Upon the symbolic climax, the colonel claimed most of his recruits. He fired his .45 into the air, and from the sky dropped a headless miniature Japanese soldier. Through the interpreter he explained that this was a sign that the Kachins should join forces with the great white father in fighting the Japs!

Surprisingly, I found a very different explanation of the Kachin-American friendship in Ann Todds book: OSS Operation Black Mail  One womans covert War against the Imperial Japanese Army , Naval Institute Press, Annapolis, MD, 2017. Colonel Carl Eiffler who established the OSS base in northern BurmaDetachment 101, talks about his meeting with the tribal chief:

Roberts lived among the Kachins for many years. He gave them a written language, based on the western alphabet. He so impressed these people that they adopted him and his native country. They were known to be exceptionally friendly to America . As a direct result of this great missionary's work, this tribe was chosen by the Rangers for training. They were firmly loyal and took part in many victories against the occupying Japanese forces. The American Rangers considered them among the finest jungle fighters in the world.

American military forces needed some way to harass the Japanese troops and slow their consolidation of the country until sufficient forces could be sent in for a military confrontation. Planners in Washington considered parachuting rangers into the jungle to lead native forces, but where should these troops be dropped? A historian pointed out that in 1878 an American missionary named William Henry Roberts had entered Burma and made his way among the violent, warlike tribes known to the Burmese as Kachins (Robbers). The Kachins called themselves "Jingpaws" ("men of the hills") and that is why the US leaflet starts "Jingpaw Ni!"

We start our story in the jungles of Burma . The Japanese had advanced through that country in the early years of the war, cut off the Burma Road and appeared to have a stranglehold on the supply routes to China . They conquered Mandalay on 21 May 1942 forcing the British to retreat into India .

During World War II almost 100 different propaganda leaflets in the form of banknotes were prepared and disseminated by the Allied and Axis combatants. In the first section of this article we illustrate and translate those notes that were produced by the United States of America . There are not a great number of these, but they are extremely interesting. In the second section I will depict the various propaganda banknotes prepared by the allies of the United States .

The field of psychological operations (PSYOP) and aerial propaganda leaflets is vast. Billions of leaflets were dropped during WWII, with thousands of different themes. One of my favorite categories is the leaflet in the form of a banknote. It is a very strong psychological tool. Few people will fail to pick up a banknote on the ground. For this reason they have always been popular as a medium of propaganda. In this article we will discuss and illustrate the banknote leaflets prepared by the Allies for use against the Axis powers and their collaborators. Portions of this article have appeared previously in the International Bank Note Society Journal , Volume 23, No. 3, 1984 , Volume 24, No.2, 1985, and Volume 24 No. 3, 1985.

The answer is "zero." The U.S. Government never paid the holders of the Japanese occupation currency one cent. The U.S. courts decreed that the statute of limitations had passed. By using this loophole, the courts were able to avoid the difficult issue of determining the validity of the claims.

A War Trophy Stamp on a 1 Peso Note

Since we are talking about inked hand-stamps on Philippine occupation currency, I show one from Bill Myers that appears in the MPC Gram No. 2314. Apparently an American soldier wanted to send this banknote home as a war trophy. They was no way to tag it so it was stamped Inspected in the field by Joint Intelligence No. 224. These hand-stamps are found round, square or rectangular.

Overprinted 10-Peso McArthur Has Returned!

One other banknote was overprinted by U.S. forces for propaganda use in the Philippines . It was not disseminated. A 10 peso Japanese invasion money note was overprinted MACARTHUR / HAS RETURNED / **** / LEYTE , OCTOBER 19, 1944. The overprint was applied on MacArthur's flagship, the U.S.S. Nashville. MacArthurs famous return to the Philippines did not occur until the 20th, so all the overprints were incorrect and the entire stock of banknotes was ordered destroyed. As always, a few were saved by souvenir collectors.

A Fake MacArthur Note Sold on EBay

Researcher Joseph Boling told me that he had seen some recent fake MacArthur banknotes in 2015. He said:

A fake Philippine JIM 10 peso notes with the MACARTHUR HAS RETURNED commemorative overprint was recently sold on EBay. The overprint was made by inkjet, as is almost everything bearing an overprint that this group sells. Some ways to identify this fake is that they left off the exclamation point after "RETURNED," and he used a comma after LEYTE instead of a period. The forger evidently did not use a genuine note as his source. Unfortunately for the forger, this note is such a rarity that none of the bidders recognized it and it sold for just 21 pounds.

United States Counterfeits of Philippine Currency

We should also mention that the United States counterfeited the wartime currency of the Philippine Islands to a great extent. The banknotes were needed by the guerrillas in their fight against the occupying Japanese forces. We know from Intelligence Activities in the Philippines during the Japanese Occupation, Military Intelligence Section, Far East Command, Tokyo, Japan, 10 June 1948, that a shipment of gems and genuine banknotes were smuggled into the PI in December 1942. Major Jesús Antonio Villamor made the first Allied secret landing (code name "Planet Party") with 4000 Pesos worth of gems and 350 Pesos in Philippine Commonwealth bills, the total Philippine currency then available in the Commonwealth Bank of Australia.

In January 1943, there was an urgent request for an additional 500,000 Pesos in artificially aged banknotes. That shipment arrived in Australia in February 1943. In August 1943, an additional 1,000,000 Pesos was requested from Washington D. C. Very likely the Japanese occupation notes for the Philippines were counterfeited by Major Willis C. Reddick who once told me that he had established an O.S.S. forgery plant in Washington D. C. at 25th and E Streets, using paper from the Byron Weston Company in Massachusetts . He also established an OSS printing plant in London , England . Reddick became friendly with employees of the Bureau of Engraving and also was able to pick draftees with printing experience from basic training units in the Army. He retired as a Lieutenant Colonel at the end of the war. He added:

With the exception of printing large quantities of Japanese occupation notes, the operation in which I was in charge, we did no currency.

American Forgery of the Philippine One Peso Note

The United States first reprinted Philippines Commonwealth treasury certificates of 1936 and 1941 for use by Philippine guerillas. The 1, 5, and 10 pesos notes of 1941 were delivered to the United States War Department between January and September 1943. These notes were chemically aged to appear used, using a process developed by the Bureau of Standards in 1943; the process involved tumbling the notes in coffee grounds and floor sweepings. The 5, 10, 20, and 100 pesos notes of 1936 were not aged.

Notice that the Fourth and Fifth Leave Veins Touch (Inside Box)

The forgeries are so well done that it is hardly worthwhile showing both a genuine and forged banknote. The differences are very minor. For instance, in the case of the 1 Peso bill the fourth and fifth veins in a decorative leaf do not touch on the genuine, but are connected about one-half way down their length in the counterfeit. A collector stated in Banknote Reporter that his counterfeit 5 peso notes were 72 mm wide while the genuine Japanese occupation notes were 68 mm wide. It is unknown if this is a standard error that can be used to identify the counterfeits or just occurred in this case.

A second shipment was requested:

A 15 October 1943 letter from MacArthurs Headquarters to the Chief of Staff in Washington D.C. says in part:

It is requested that steps be taken to reproduce, for use in the Philippines , 10 million Pesos (P10,000,000) of Japanese occupation currency It is requested that the ten million Pesos be prepared in the following denominations, to represent old bills: a. Ten Peso bills  5,000,000

b. Five Peso bills  3,000,000

c. One Peso bills  1,500,000

d. Fifty Centavo bills  500,000 It is requested that one million Pesos, approximately the proportion indicated above, be dispatched to this theater by air as soon as possible and that the balance be dispatched by water transport.

The first million Pesos was counterfeited in Washington DC and flown to the Philippines on 21 December 1943. They were distributed to six different guerrilla groups. The known block letter codes known on the American forgeries are:

Fifty Centavo bills  PA, PB, PE, PF, PG, PH, and PI.

One Peso bills  PH

Five Peso bills  PD

Ten Peso bills  PA, PB, and PC.

The Japanese occupation banknotes may not be the only ones counterfeited by the U.S.

William B. Breuer mentions in MacArthurs Undercover War, John Wiley and Sons, New York, 1995, that there was a need for currency by the Guerillas as early as March 1943. He adds:

A hurried check with Washington disclosed that a huge shipment of Philippine pesos for the Mindanao operation had been shipped by special air transport. As a security measure to ward of sticky fingers, the small fortunes container was labeled Finance Forms. At the Allied Intelligence Bureaus headquarters, it required several men fifteen hours to count all the pesos, which totaled the equivalent of a million U.S. dollars.

Since the request for counterfeit Japanese occupation currency was sent late in 1943 we might assume that these were genuine banknotes. However, other declassified documents in my collection show that:

In January 1943, when plans were being made to send other intelligence parties, an urgent request for $500,000, artificially aged, Philippine currency, was sent to Washington. The request, filled and dispatched by highest air priority, was received in Australia during February.

Since the type of currency is not clearly identified, it is possible that this early forging of Philippine currency was the regular banknotes, issued prior to the Japanese occupation.

Lieutenant Robert Stahl says in: You're No Good to Me Dead: Behind Japanese Lines in the Philippines, Naval Institute Special Warfare:

We also carried thousands of Philippine pesos-real money newly printed in Washington, D.C loosely packed with water and sand in sealed, five-gallon metal containers. The water - and sand mixture was intended to age the money, since Filipinos would be hard pressed to explain to the Japanese where they got crisp, new paper money. Aging the currency this way was a brilliant idea-until it came time to dry it so that it could be spent. If we had sunlight we would spread it on the ground and hope it wouldnt blow away while it dried. During the rainy season, which seemed to be all the time, we sat beside fires waving wads of currency over the heat to drive out the moisture. We also had counterfeit Japanese invasion currency (called APA in the islands), American made, to spend freely to inflate the Japanese currency.

Later, Stahl mentions a fact that I never heard before. He says:

Workers accepted our APA currency even though we were passing out higher denomination bills than the Japanese ever printed. Some of the large denomination currency was later known to have been used by the Japanese troops .

That seems very risky to our Philippine Allies. Stahl apparently paid them with banknotes that were patently false since no such denomination existed. A Filipino found with such a note would be severely punished if not shot by the Japanese. Then we hear that some Japanese soldiers used the banknotes. Did they think they were real, or did the pass them knowing they were false? What an interesting concept.

Lucien V. Campeau says in an article entitled: My Air Force Weather Mission from April 1944 Through April 1945 With the American Guerrillas of Mindanao:

The sub was loaded and the next day we boarded the Narwhal. As I was boarding, Chick Parsons handed me a five gallon can with gunny sack sewed around it and soldered shut to water proof it. This was 25,000 real pesos made in the U.S. and soaked in salt water to make them look old and used. I was to use the money as I saw fit for intelligence purposes in case the Filipinos would not accept our emergency money and I needed something done in an emergency Smith and I each carried a pistol, rifle, machete, jungle hammock, backpack of food, and entrenching shovel-mine for two purposes, for  I still had diarrhea  chronic, bordering on dysentery. We rigged up two small sleds, like miniature carabao sleds, and on them we pulled the three pieces that constituted a 3BZ radio, the two storage batteries required for its operation, a gasoline-powered generator, two five-gallon cans of gasoline, and three cans of real pesos I moved off in another direction and dug a hole about two feet deep and large enough around to take a five-gallon can. This was difficult digging, for the ground was mucky humus threaded with a thick mat of twisted tree and plant roots. Into it went one of our three cans of pesos. I drove a stake close to its heart and marked it with a piece of cloth. Not far away I buried another can, and, still another short distance away, a third can. I had just put sixty thousand pesos-thirty thousand American dollars-into an earthen safe-deposit box We had taken thousands and thousands of pesos with us from Australia, all neatly packed in tin cans full of sand and water, cans like those I had buried on Palapag Mesa. When the Narwhal brought men and more supplies to us on Samar, there were more cans of money included in the cargo. And when airdrops were made to me on Luzon, even more money arrived .

We should end this section on Philippine currency with the official Proclamation to the People of the Philippines made by General Douglas MacArthur upon his return to the Islands. He states that there will be new banknotes; and that the old ones before the Japanese arrived and that emergency notes printed by the pro-American guerrillas are all valid, but anything the Japanese or their collaborators prepared are invalid:

A new victory series of Philippine Treasure Certificates (Victory Pesos) and Philippine coins, identical with pre-war issues, have been prepared and will be legal tender. The rate of exchange is two Victory Pesos for one American dollar. All pre-war Philippine Treasure Certificates are valid. Japanese currency, Philippine National Banknotes (except for duly authorized emergency issues), notes of the Bank of the Philippines Islands, and New Central Bank notes are not legal tender. Transactions in these currencies are prohibited.

A Souvenir Booklet Containing Japanese Occupation Banknotes of the Philippines

American soldiers are great souvenir hunters and collectors and will generally find a way to make a buck. In this case, some enterprising American put together a handsome booklet that contains Japanese occupation currency from one centavo to 500 pesos in plastic sleeves. I am sure the booklets sold well to civilians when the entrepreneur returned to the United States.

American Propaganda Parodies of Japanese Banknotes

Genuine 10-Yen banknote

For the final American propaganda banknotes, we have to go to the Japanese home islands. The story mentioned in Numismatic News, 17 January 1966, in an article by Alfred J. Swails entitled United States Propaganda Notes for Japan.

The Military Intelligence Hawaiian Department under Lt. Colonel Richardson was given the assignment to prepare four facsimile notes with different messages to the Japanese people on the back ... Our planes showered the notes over the countryside, knowing that 50 percent would fall and lay face or money side up and entice the greed of the finders.

Dr. Felix D. Bertalanffy wrote an article on this subject for Numismatics International, April 1980. In his article entitled The Ten Yen U.S. Propaganda Forgeries of the Pacific War he wrote:

Postwar interrogations by Col. Bonner F. Fellers of Japanese officials associated with the wartime government singled out four types of propaganda leaflets as the most effective and as exerting the greatest impact of all the great variety dumped on Japan. In the summer of 1945 Japan was showered almost daily be aerial leaflets in such quantity that the Japanese people developed a kind of apathy against them. A novel approach had therefore to be sought to attract renewed attention. The ingenious idea was to reproduce the face side of the then current 10-yen banknote and replace the back by a propaganda message. For who could resist money falling from the skies? The note was exquisitely reproduced by lithography to resemble closely the genuine bill. One striking difference is the Okura Kaijin seal, printed in red on genuine bills, appears in the same brown color as part of the body of the phoenix on the counterfeit.

There is one brief mention of wartime dissemination in a letter to the editor of Banknote Reporter, October 1983. John Hopkins, a sailor who served in the Far East during the war said that notes were dropped on Japan by carrier-based aircraft.

Japanese 10-yen parody front

There are four parodies of the Japanese 10-yen Bank of Japan convertible note of 1930. All of the parodies bear the serial number 450941 and the block number 1124 on the front. On the back, the notes are found with four different propaganda messages and the code numbers 2009, 2016, 2017 and 2034. I obtained copies of all four banknote leaflets when I obtained a copy of the classified "Confidential" booklet entitled United States Pacific Fleet and Pacific Ocean Areas - Psychological Warfare - CINCPAC-CINCPOA Bulletin No. 164-15, 15 August 1945. The data sheets state that the purpose of the leaflets is to create resentment against the present government in Japan and create fear of inflation...The note conforms to the size of a Japanese banknote which is carefully reproduced on one side.

2009

The OWI fact sheet for banknote leaflet 2009 says:

A close reproduction of one side of a Japanese bank note is used to assure that the leaflet will be picked up and to reinforce the text, which hammers on the sore nerve of burdensome taxes and the wasteful expenditures of the war. Resentment against the militarists (Gumbatsu) is encouraged. On one side a close reproduction of a Japanese 10 yen note, size approximately 5 1/2 by 3-inches. Since about half of the leaflets will land face up, this is an assured attention-getter for the text, which carries a simple economic message.

Code number 2009:

PAY YOUR TAXES WITH THIS MONEY

The Gumbatsu is wasting your tax money. For this war the Gumbatsu has spent the equivalent of 5000 yen for every Japanese. Think what you could have done with that. Every day the war continues more of your money is being wasted.

Leaflet 2009 Short-Snorter

We show more of these souvenirs below. Americans would take these notes and sign them; and often have friends and comrades sign them as a souvenir. This note was signed by Owen Murrell, S 1/C, 2nd Div., USS Kwajaline CVE 98 at the top, just below and over the Japanese text we think it says GPO San Francisco, Calif, and at the bottom: Owen Murrell, Route 1, Perry, Iowa.

I am guessing the Owen was a U.S. Marine Sergeant First Class on board the USS Kwajalein (Notice that he misspelled the name), an escort carrier of the United States Navy launched on 4 May 1944, and built by the Kaiser Company.

The OWI fact sheet for banknote leaflet 2016 says:

To promote dissatisfaction among workers on the Japanese home front. It is known that the families of soldiers and officers receive special ration privileges in Japan . This fact is used in conjunction with the striking reproduction of a Japanese bank note to arouse dissatisfaction among workers.

Code number 2016:

FACTORY WORKERS You have made much money up to now, but what good is it? You can buy little more with it than you can with this 10 yen. Those who devote their total energies to war production are the same as soldiers. You are soldiers of production. But, do you get plenty of beer and rice? Do you received specially distributed goods such as soldiers and their families receive?

One of the propaganda banknotes numbered 2016 was sold at auction in 2004 with the following comment:

James Inmon, U.S. Navy Aviation Navigator, was among a crew that flew reconnaissance flights over Japan for such duties as target selection, psychological warfare, maps and aerial photography. Inmon flew a mission when these 10 yen propaganda documents were dropped over Nagasaki prior to being bombed. Inmon saved one note and carried it home in his wallet. 2017

The OWI fact sheet for banknote leaflet 2017 says:

To disrupt the civilian economy in Japan by encouraging demand for commodities in excess of the supply. Skepticism regarding the worth of Japanese war bonds is known to exist in Japan . This fact is used to encourage the purchase of supplies and the resulting disruption of the civilian economy.

Code Number 2017:

JAPANESE! What good is money in the bank or in bonds? Buy articles you need now and buy articles for future use. The remaining supply is low. As a result of the bombing by America , many of your stores will close their doors while others will be open only for limited periods.Buy food, clothing, and other necessities to tide you over these periods. Money will not satisfy your hunger or clothe you. Bonds will not satisfy a babys cry. A wise person would buy now, not save his money. The present is not a time for money. It is a period for goods.

Short Snorter

We mention the American habit of collecting autographs of unit members on banknotes as a souvenir of service above. Here, a soldier has collected the names of his friends on the front and back of OWI propaganda leaflet 2017. On another banknote attached to this leaflet a soldier wrote Iwo Jima so that might indicate where this was prepared. I have depicted the leaflet vertically so the names can be read. As best I can make out they seem to be:

J. H. Garrett  Lt. Col.

Frederick W. Rittel  Captain

B. H. Thomas Casper

Morton Ardmore

Short Snorter Banknote Leaflet 2034 (Below)

This short snorter is a record of one mans WWII and consists of six items including a 10 Yen from Japan signed by a Major Herman Schroeder, OWI leaflet 2034 with a typed comment Propaganda leaflet - Tinian, a 5 Yen from Japan with typed message at the top Removed from a dead Jap in a cave on Iwo Jima and an unreadable signature, a 10 Yen from Occupied Korea with one unreadable word and 3rd summer - 1944, a 10 Yen with Occupied China and a 100 Yen from Japan with Sapporo, Hokkaido, 5/8/1945. We depict the fronts, so the propaganda leaflet is the banknote at the right.

Admiral Chester Nimitz signs a Short Snorter on Guam, Summer, 1945

2034

The OWI fact sheet for banknote leaflet 2034 says:

To create resentment against the present government in Japan and create a fear of inflation. The illustration, reproducing a 10 yen note on one side, in calculated to attract attention. The text suited to the illustration, carries an economic message  namely, the rise in prices and the drop in quality brought about by the war.

Code number 2034:

In 1930, when the Gumbatsu had not yet started the war in China , you could buy the following items for 10 yen:

* 25 sho [about 20 Kg] of good rice. * Or, material for 8 summer kimonos. * Or, Four bags [50 Kg. Packages] of charcoal

In 1937, after the start of the China Incident, you could buy the following for about 10 yen. * 25 sho of low grade rice. * Or, material for 5 summer kimonos. * Or, 2 bags of charcoal. Today, after waging three years of hopeless warfare with the worlds greatest powers, you can buy the following with 10 yen: * ½ sho of good rice on the black market. * Or, a small amount of charcoal, if you can get it. * Cotton material, nothing.

This is what your leaders call co-prosperity.

The messages were aimed at creating discontent with the military leaders. The constant harping on immediate purchase of commodities would lead to a breakdown of the Japanese rationing system. Did the leaflets work? Some of the comments of Japanese leaders interviewed after the war would lead us to believe that the 10-yen notes were successful.

At the end of the war, W. D. Conde of the U. S. Civil Information and Education Section ordered a number of uncooperative Japanese "thought control" officials to the Radio Tokyo Building where they were questioned about the effectiveness of the American OWI leaflets. Many of the individuals had been dismissed from their government job in accordance with the American Supreme Commander's directive. At least fourteen Japanese agencies dealt with Allied psychological warfare material. None of the individuals had notes and all make their comments directly from memory. The individual comments were very similar which indicates either collusion, or that they were telling the truth and were of the same opinion.

Iwatai Sakamoto, Chief of the censorship Bureau of the Tokyo Metropolitan Police Department cited the 10-yen note leaflet as one of the most effective.

Toshikazu Kase, Chief of the First Section of the Third Department of the Cabinet Board of Information added, The 10 yen note leaflet was the most effective. It was a very powerful leaflet. It evoked great interest and curiosity among the Japanese people.

Masjiro Kawaguchi, Chief of the Foreign Affairs Bureau of the Home Ministry forwarded a report that said, Leaflets of our 10 yen notes most excited the curiosity of our people. The best leaflet was the one that dealt with the cost of living [No. 2034]. In Fukushima , Fukuka, and Aichi Prefectures there were cases where the 10 yen leaflet was used as currency.

A report of the Foreign Section of the Home Ministry adds, The 10 yen banknote leaflet aroused the nation's curiosity and gave the financial circles anxiety as they believed that the Americans might drop counterfeit currency at a later date. The banknotes addressed to workers [2016] were unpopular among the working class because they felt insulted by the leaflet. About the 20th of June, a certain Yamazaki in Hiroshima Prefecture used the forged 10 yen note leaflet and was arrested.

A departmental ordinance decreed that the Japanese people collect and turn in Allied leaflets. Those who disobeyed faced a sentence of up to three months in jail and a fine of up to 100 yen. The government did not fear the American propaganda and expected each citizen to do his duty to his Emperor and his nation. It seems therefore, that there was no great enforcement of the ordinance. There were less than a dozen people actually arrested for carrying and reading leaflets, and all apparently received reprimands with no incarceration.

Time Magazine of 18 June 1945 mentioned the 10-yen propaganda banknotes in an article entitled Down with the Gumbatsu! The article tells of the major PSYOP campaigns to induce Japan to surrender. Some of the comments are:

Leaflet bombing of Japan has been stepped up sharply since V-E [Victory in Europe ] day. Both B-29 Super-fortresses and carrier-based planes are dropping paper salvos, at the rate of 500,000 to 1,000,000 leaflets daily. Principal target of these broadsides is the Gumbatsu, the military clique that rules the empire. A small leaflet like a 10-yen note bears on the reverse: "The Gumbatsu is wasting your tax money. For this war, the Gumbatsu has spent the equivalent of 5,000 yen for every Japanese. Think what you could have done with that." A major theme is the exploitation of Japan 's national hypochondria. Says one leaflet: "Water lines and electricity will be destroyed by bombs. Food will become scarce. Thus, you will weaken and become sick. . . . With every bombing, the country becomes more unclean, and it is more difficult to control disease. Put an end to this needless suffering. Demand that the militarists who started this war bring it to an end."

We should point out here that all the items we have discussed are propaganda banknotes. They are in the form of banknotes to make them more desirable to pick up. These propaganda banknotes made no attempt to deceive the finder and were not part of economic warfare. We must also warn the reader to always know the origin of such propaganda notes. They have been reproduced and sold on EBay. One dealer states:

You are purchasing here a REPLICA-COPY of a historic Paper Currency Note made using Quality 32lb paper stock coated very lightly with a thin flexible plastic coating. This coating adds protection to the item, but in no way detracts from the overall beauty of the note.

On the other hand, there are also a great number of espionage counterfeits meant to be used by agents or destroy an enemys economy. These include possible forgeries of the banknotes of Japan , Thailand , Malaya, the Philippine Islands, Chinese puppet banks and Burma . That is an entirely different story and one that I have covered in some depth in various issues of The International Banknote Society Journal.

A lot of documentation exists of these psychological operations. The OSS kept it a closely guarded secret and it is often difficult to tell what banknotes were being copied because the term used was almost always merchandise, and the nations and sometimes the agents were either unnamed or given a code name or number. Some examples are listed below.

Operation Toy Horse - Allied Military Currency for Japan

Toy Horse was a classified operation where Japanese occupation banknotes were printed in San Francisco and then shipped to Sacramento for numbering, cutting and wrapping by the State Printing Office hidden in the Governors Hall of the State Fairgrounds. This photograph of Operation Toy Horse was from the estate of Norman Jack Rath, a foreman at the State Printing Office during the project. USAF Colonel (Retired) Joe Boling told me:

Both the A-yen and B-yen were printed by Stecher-Traung in San Francisco, and the numbering, cutting, and packing by the California State Printer in Sacramento.

In May 1943, an OSS executive suggests that a good counterfeiter be found in prison and released to do war work.

An August 1943, document implies that the OSS has forged Chinese puppet bank money and says it is decreasing in value so quickly that it is hardly worthwhile. It advises against the forging of Japanese currency because of the risk. It is impossible to say if any such notes were counterfeited or not.

In October 1943, there was a request for 20,000 of each item. Burmese currency was the first priority and dollars and cents was next. Many of the Japanese occupation notes used dollars and cents, so there is no telling what country this indicates. The letter states that a previous delivery has already been put to use.

Another October 1943 document asks if the 500,000 named refers to Burma or Malaya merchandise. That seems to disclose at least two of the nations whose currency was being counterfeited. The document requests additional samples of Malaya goods in the denominations of 10, 5 and 1.

A September 1943 letter mentions secrecy and points out that the British are saying nothing either. It goes on the state that the OSS is not telling the British that they have sent a certain type of merchandise overseas already. A second letter mentions merchandise and recommends caution.

In November 1943, there is a discussion of BA merchandise (probably Thai baht) and there is mention of 90,000 units to be available soon. The same month there is a request for one-half tons of Siamese botts. We now know that this request was made by a U.S. Naval Captain Miles who was stationed as an Intelligence Officer and Naval attaché in Chungking , China . The OSS called these counterfeit notes the Bangkok type.

In December 1943, the OSS Research and Development Section received Japanese Burma and French Indo-China sample notes from Detachment 101.

In March 1943 the OSS request for Thai counterfeit currency was upped to 3 million baht in denominations of 1, 5 and 10 baht.

Captain Milton Mary Miles, the Navys senior intelligence officer in Chungking, asked that the OSS provide 1000 pounds of counterfeit Thai notes. The OSS embarked on a project to forge 3 million baht of the 1, 5, and 10 baht notes. By June 1944 the OSS notes were deemed inadequate because of a lack of high-quality genuine notes, and the project was abandoned.

In June 1944, a document mentions 100,000 Thai baht being counterfeited in London . The British firm of de la Rue apparently counterfeited what they called the London type of baht in the denominations of 1, 5 and 10 baht.

On 17 February 1945 an OSS cable discusses the availability of, and the "aging" process necessary for counterfeit Siamese Tical and Japanese Burmese notes.

In May 1945, the OSS states that it is in possession of the countrys best means of merchandise production. That seems to indicate that the OSS had a forgery printing plant, but it does no state what country this is in.

The American OSS in Stockholm allegedly produced another propaganda banknote. Sefton Delmer, the British director of black radio operations mentions it is some disgust in a letter to his superiors dated 19 February 1943. He wants to discuss the production of leaflets in Stockholm for distribution to German soldiers in Norway. He says, "I have seen some of this stuff and I think it is so dangerous that I am almost prepared to believe that the organization may have been penetrated by German agents." Delmer identifies one of the items that displeases him, "a 20-mark note marked 1914 and a 2-billion mark note marked 1923, all of it with a large "1918" scrawled over it in white and a typed caption starting with "1918" and ending with "Was nun?" The whole thing is beautifully calculated to back up the German line that they are the alternative to chaos and Bolshevism.

I have never seen this banknote so it is possible that Delmer's complaints were listened to and acted upon.

Payday

Speaking of money, here we see some sailors getting paid onboard a ship. They are lined up tight. As I recall, in the Army back in the distant past we did it a bit different. It has been a long time, about six decades, but I seem to recall standing in a line in the hallway outside the pay room. When your turn came you gave two loud knocks on the door, entered looking straight ahead, walked to the center of the room, did a right face to where the paymaster sat, saluted and shouted out your name. You were told to step forward and received your pay. You then stepped backwards, did a right face and walked​​ out of the room. It was pretty detailed. If you messed up any part of the drill you would get a good talking to from the First Sergeant.

XBA-37 - Front

The United States office of War Information produced a "labor appeal" leaflet for the Burmese people coded XBA-37 in November 1944. The leaflet pictured currency and had text in Burmese, Shan, and Kachin:

REAL MONEY AND GOOD RATIONS FOR ALL WHO WORK.

Depicted on the front is a silver rupee and coinage, bags of rice and atta, and boxes of salt and sugar.

XBA-37 - Back

Text on the back is:

Get wages, raises and bonuses. Friends! Do you wish for the day when you can return to your own home and to the normal ways of peace? You can bring that happy day nearer by working for the Allies now.

The Allies are paying regular wages in real money plus good rations. The rations include atta, rice, sugar, oil, and salt. Plus, they are paying extra bonuses to steady workers. Friends, there is a place for you for the kind of work you do. Allied soldiers are crushing the Japanese. Civilians help by working. Together we will drive the Japanese invader out of Burma. Together we will end this war sooner. Work for the Allies and help beat the Japanese. Come and get your wages and rations today.

Wages

Coolies: 1 rupee per day

Coolie bosses: 4 rupees per day

Carpenters: 8 rupees per day

Mechanics: 45-90 rupees per month

Men with ox carts: 2 rupees per day

Bonus for working 25 days in a month: 5 rupees

Bonus for working 30 days in a month: 10 rupees

Help beat the Japanese

This concludes the listing of the propaganda banknotes produced by the United States during the last World War. There were millions of counterfeit banknotes produced by the Americans and aimed at the Japanese home islands, their invasion money, Thailand , Burma , Malaya, Indochina, and the Japanese puppet banks in China . That is another story.

I end this section on U.S. propaganda parodies and espionage forgeries with a mysterious banknote that may or may not be a forgery, and might have been prepared by the Americans or the Germans since both sides were deeply interested in Yugoslavia.

50 Dinara Serbian Banknote Forgery

Sometimes there is doubt about whether or not a banknote is a government-sponsored forgery. For instance, there is the case of the alleged United States government forgery of the 50 dinara Serbian National Banknote of 1 May 1942. I first ran across a brick of about 100 of these banknotes about 1990. The seller was the wife of a deceased WWII airman who claimed that the banknotes were government forgeries issued to her husband when he flew over Yugoslavia. He was to use them to bribe the locals and pay for supplies if he was shot down. There was no proof of such an operation so I never quite believed the story.

Then another such note was offered for sale, once again from the estate of a deceased airman. The background story was exactly the same. So, although we cannot say for sure that these banknotes were prepared by the OSS or some other clandestine agency to be used by downed pilots, we can say that there is some interesting circumstantial evidence.

The perfectly horizontal crossbar in the letter A

The alleged forgeries are of excellent quality. In the initial offering the banknotes had the red serial numbers M.0234 / 101 to M.0234 / 200. The more recent banknote had the serial number M.0234 / 499, which indicates that it is from the same general printing. One of the very minor differences I noted between the genuine and forged banknotes are in the issue date on the front, MAJ 1942, in which the crossbar in the A is slanted in the genuine and perfectly horizontal in the forgery and the number 9 which is broken slightly in the genuine and perfectly smooth in the forgery. There is a small box at the bottom of the back of the note and in it the first Cyrillic letter has a break at the bottom left of the letter ehf, (F) whereas the letter is perfect in the genuine.

A Banknote Wrapper

Author and historian John A. Nagy had in his estate about 100 of the 50 dinara Serbian banknotes that are exactly as described above. He has the original wrapper with his handwritten notes stating a story exactly like that we describe above. The message is:

Counterfeits printed by U.S. Government to destabilize Yugo. Currency, given to U.S. pilots in case of a crash landing.

In May 2020, I received a letter from a collector who added:

I managed to get eight of the “forged” banknotes and compare them with several genuine ones, and I can confirm that there are slight, but consistent differences. However, all my attempts to find hard proof – documents confirming their issuer – were in vain. I might manage to go back to Serbia over the summer and will try to get access to their archives and see if anything can be found there.

So, are these forgeries of Serbian banknotes? Maybe. Are they government forgeries? Maybe. Are they U.S. or German forgeries? The circumstantial evidence leans toward the United States, but we have seen no official documents yet that state that the U.S, forged Serbian currency. The reader must decide.

I have seen these banknotes placed on EBay twice and both times they failed to receive an offer. It seems that because of its unsure status as a government forgery, no collectors want to take a chance on this banknote.

Australia

1/2 Gulden Forgery of Japanese Invasion Currency

On the subject of the counterfeiting of Japanese occupation banknotes, we should mention that the Australians were also very busy. The Japanese took the islands on 9 March 1942 and held them until August 1945. The text on the Japanese occupation banknotes for the Netherlands East Indies is written entirely in Dutch. Values are Een (1), Vijf (5) and Tien (10) cents and Guldens. All of these notes bear the following: De Japansche Regeering Betaalt Aan Toonder, (The Japanese Government promises to pay the bearer on demand).

David Klinger reported that The Commonwealth Bank of Australia (CBA) counterfeited the Japanese invasion money of the Netherlands East Indies in his blog Klingers Place. Tony James also wrote an article entitled Research Unearths Evidence of Wartime Australian Copies of Indonesian JIM in the IBNS Journal Vol. 51, No. 1.

Gregory Hale says in Japanese Invasion Currency, Centaur Media, Australia, 2014:

When Japanese Invasion Money was introduced, Australia was instrumental in counterfeiting the notes and flooding the local markets with copied notes. This was done to support locals by providing them with free money to devaluate the currency and in retaliation against Japan.

In the past few years several important documents have surfaced. On 5 October 1942, Chief-Commissioner Dr. J. E. van Hoogstraten sent the following letter to the Governor of the Commonwealth Bank of Australia:

In order to effectively prosecute the war against Japan the Government of the Netherlands East Indies considers it essential to have at its disposal supplies of currency similar to that issued by Japan for circulation in the Netherlands East Indies. The need is urgent and we have to request you to arrange to supply us as soon as they can be printed with the following quantities of notes which resemble as closely as possible the specimen notes handed to your Melbourne manager: 1/2 Gulden 12,800 pieces; 10 Cents 30,000 pieces; 5 Cents 10,000 pieces and 1 Cent 10,000 pieces.

When completed we would be glad if you would deliver the notes to the order of Dr. R. E. Smits as they may be required by him. Signed: Dr. J. E. van Hoogstraten, Chief-Commissioner

The second letter was from Dr. Smits, Managing Director of the Javasche Bank to the Governor of the Commonwealth Bank of Australia (CBA). It recommended approval of the basic request. There was also a hand-written note:

I saw Mr. Chiffley [Finance Minister]at Canberra on 30/9/42. I told him of Dr. Smits wishes including his views regarding absolute secrecy. Mr. Chiffley raised no serious objections and he fully appreciated that action of this sort is necessary in war; and that the Axis is already doing what we propose to do. He is satisfied for us to go ahead and he will leave the whole matter in our hands. [Initialed 5/10/42]

The third letter requests more of the counterfeit banknotes. This letter was sent from the Netherlands Indies Commission to the Manager, Commonwealth Bank of Australia, on 20 January 1943:

Referring to our letter dated 5th October 1942 to the Governor of the Commonwealth Bank of Australia, Sydney, we beg to inform you that our stock of the special notes you have printed for us is nearly exhausted. This paper has proved to be very useful and we request you to print for us the same quantity as in October. When completed we should be glad if you would deliver the notes to our commission as they may be required. Signed: Ch.O.Van der Plas, Chief-Commissioner

XJM-48-C

There were some Office of War Information (OWI) white propaganda leaflets that used money as a point of interest. These were dropped over the Japanese soldiers in Burma in September 1944. There were five leaflets in the set: XJM-48-A to XJM-48-E. They are found in five different colors: green; purple; blue; red; and gold. The front of the leaflet depicted Japanese 5 and 10 yen coins used during the years 1933-40. The message on the front was identical on both leaflets:

Passing through a battle of death becomes a battle of disaster. Passing through a battle of hardship becomes, not a real battle of victory, but continuous defeat.

The meaning of the leaflets is explained in the OWI cover sheet:

Nearly every Japanese soldier carried a small bag or a piece of cloth to which to which 5 and 10 sen coins are sewn as good luck charms. With these coins are associated two slogans which glorify fighting for Japan and the Emperor. They are formed by a typical Japanese play on words, that is, by substituting characters which are pronounced the same but have a different meaning. Thus, passing through four sen becomes five sen is changed to mean Passing through a battle of death becomes a battle for the Emperor.

The OWI goes on to explain that they have changed the slogans so now they forecast Japanese defeat. The messages on the series except for letter D is based on actual Japanese quotes. Each leaflet has its own color and all of the leaflets will be dropped simultaneously.

The message on the back of XJM-48-A is:

Checked by America and Britain, we now face a situation which not only causes anxiety to the Emperor but makes it difficult to maintain the inviolability of our homeland against enemy invasion. The present war situation is extremely severe, and our difficulties are mounting on many battle fronts. The war has become the most violent in human history. Our Empire confronts a crisis unprecedented since its foundation.

The message on the back of XJM-48-C is:

Where is the Navy? Our navy has vanquished the American Navy. This statement was made by Premier Tojo on 27 May 1942. American soldiers then invaded Saipan Island . This caused the Japanese Government to take drastic measures. On 18 July 1944 Japan lost Saipan Island . This caused Premier Tojo to resign. Fellow Japanese soldiers, our navy can no longer provide you with the necessary materials you need as soldiers. Because of the present situation, we can't even protect our own land.

The message on the back of XJM-48-E tells of the failure of the invasion of India .

The OSS became aware of the United States Government's secret plan to introduce occupation money into Germany and France in early 1941. A declassified Office of Strategic Services document dated 23 February 1944 from Stanley P. Lovell, Chief of Research and Development to the Chief of the Morale Operations Section says in part:

As you know, our contacts with American money producers are extremely intimate. We have reason to believe that paper money by use for Allied troops upon the occupation of both France and Germany is now actually made.

It has been suggested by Lieutenant Colonel W. C. Reddick [the OSS Forger in London] of this office that a tremendous psychological effect would be produced if all aviators flying over Germany were to carry some of this (counterfeit) money, and other potential prisoners of war were to have it found on them. I am unable to evaluate whether this would be demoralizing to the Germans or not, but pass the idea on to you for whatever it is worth.

It is obvious that the OSS also gave some thought to the actual counterfeiting of German currency. A declassified 27 June 1944 report entitled General Plan for Morale Operations against Germans as Holders of cash mentions what might be done and the problems that the operation would entail. Some of the comments of the 14-page document are:

German marks can be counterfeited satisfactorily; it would take about three months to make the plates; it would take two to three months more to begin a sizable program in Germany . Dropping marks from planes is the only feasible method of increasing the supply of money if bombers carried two and one-half tons each, 1000 bomber loads could drop 100 billion Reichsmarks. Clearly therefore, the task is manageable. Objections of this project take the following lines. Dropping money is not a moral or proper way to fight a war. It is in the same class as gas A severe inflation in Germany would embarrass the Allied postwar occupation authorities dropping money on Germany would evoke retaliation in kind against Britain the Germans already think that the United States has such stocks and they have threatened special reprisals against airmen who drop currency. It is recommended that the OSS proceed immediately, independently of the British, to have currencies of Germany and her satellites counterfeited and held in readiness for use.

One of the chief American counterfeiters of enemy currency was retired Major Willis Reddick who is mentioned above. I spoke to him many times in the last years before his death. He worked for Stanley Lovell, OSS Director of Research and Development. Lovell was troubled with the assignment, for although he had Roosevelts permission to forge enemy currency, he had no signed authorization. Should the operation blow up in his face, clearly it was he that would take the brunt of the criticism. He stalled and moved forward very slowly. Reddick did eventually counterfeit Japanese currency, but probably never did the German banknotes.

British 1 Baht Counterfeit of Siam

On one occasion Reddick actually talked about sending Siamese banknotes to India in August 1944 as part of convoy KMF.34. The banknotes were put in tin-lined tea boxes soldered shut and transported by a British destroyer. British records tell us that on 18 May 1944, Reddick and British agents visited the Bank of England to discuss producing the banknotes of Siam. The ordered 1,500,000 one baht notes, 1,000,000 five baht notes, 100,000 ten baht notes and 100,000 twenty baht notes from Thomas de la Rue printers. On 5 September 1944, the British report the following Siam notes sent to India: 1,500,012 one baht notes, 1,300,012 five baht notes, and 126,000 ten baht notes. The notes all bore serial numbers and signatures of genuine banknotes that might still be in circulation. Fred Schwan and Joe Boling mention this operation in World War II Remembered, BNR Press, Port Clinton, Ohio, 1995:

Thomas de la Rue printed Thai banknotes before the war. Sometimes during the war, English officials requested that the company reproduce some series four notes for military operations The company did produce 1, 5 and 10 baht notes They are reported to have been used by Indian units of the British Army and by anti-Japanese resistance fighters for bribing officials in Thailand

The United States did not prepare any propaganda banknotes for use against Germany . However, they apparently did plan to use both genuine paper money and coins in a PSYOP campaign against the Third Reich during WWII. A declassified secret document in the U.S. National Archives reveals that the Office of Strategic Services had a plan to use currency as part of a propaganda campaign. The plan called for the airdropping of legitimate United States money and postage stamps on Germany inside envelopes along with a small 4 x 6-inch card with a propaganda messages. The messages would compare current events to the hyper-inflationary period after World War One.

The plan was first discussed at the end of June 1944 and known as Special Plan C-5 / U.S. Postage Stamps and Coins / Target German Civilians with Cash. It called for the printing of one million small envelopes with propaganda messages printed on them. Each envelope would contain a stamp, a coin, or a one-dollar bill. Each envelope would be preprinted, A Gift to the Finder from German-Americans. The envelopes would be dropped over cities that had not been bombed since the OSS believed that Germans in undamaged cities would be more amenable to its message. The proposal called for the following items to be collected to be placed in the envelopes: 10,000 U.S. $1.00 U.S. currency notes; 20,000 10-cent silver coins; 40,000 5-cent stamps; 266,000 3-cent stamps; and 664,000 1-cent stamps. Note that this is exactly enough items to fill 1 million envelopes. The amount of money and stamps totaled $26,520.00. The estimated cost of printing the million envelopes was $25,000.00 for a total production cost of $51,520.00. The fact that all the envelopes contained something of value would be a strong incentive for the Germans to pick them up and open them. The OSS suggests that each envelope should state the value of the object inside in the value of 1923 German marks.

The message on the envelope with the $1.00 note was to be:

This $1.00 banknote was worth 4,000,000,000,000 marks in 1923. Then you had no gold, but your industry could produce and you were able to borrow from America the next year. You have no gold now and your industry is being destroyed. If you permit it to be completely destroyed, how can you ever borrow again?

The message on the envelope with the 1-cent stamp was to be:

This one-cent stamp was worth 400,000,000 marks in 1923. Participation notes with a face value of one American cent actually circulated in Germany that year. American money came to your rescue.

Other suggested messages are:

When you remember walls papered with German bank notes in 1923, you understand, do you not, why people who lived through the last inflation are now spending what money they have on the open market where they can buy something tangible before it is too late? Do you know what the internal debt is in Germany today? What will it be when you reimburse those who have suffered losses in the war? Where is the money coming from? Do you know how much currency is in circulation today? It increases while production declines. Is it any wonder that prices on the black market  which is the true measure of inflation  go up every day? Your money will buy less and less.

There was a suggestion in a 6 July 1944 letter to OSS Director Major General William J. Donovan that the United States counterfeit German money:

It is suggested that the Bureau of Printing and Engraving or some other suitable agency prepare a great quantity of counterfeit German paper currency. This counterfeit currency should be so perfect as to paper, engraving and all other characteristics that experts could not distinguish it from bona fide German issues. The currency should be patterned after the latest type found on German prisoners. On every bombing mission large volumes of this counterfeit currency would be dropped over cities and other heavily populated areas. The currency should be crumpled and treated to look as if it has been in circulation for some time. If this procedure were carried out systematically, it would result in a spending spree that would cause great confusion.

There were two problems with this plan. It was determined that the Bureau of Printing and Engraving would have to print German currency day and night at the expense of U.S. currency in order to damage the German economy. The second problem is that there seems to have been an unwritten gentlemans agreement between the U.S. and Germany that they would not counterfeit each other's currency.

This plan never came to fruition. A similar campaign was waged during Operation Enduring Freedom in Afghanistan 60 years later when genuine 100-afghanis banknotes were dropped with the message Our goals will be achieved, if not willingly, then by overwhelming force and envelopes adorned with an image of President George W. Bush were dropped containing two banknotes and a propaganda message.

Great Britain

During World War 11, Great Britain produced numerous "black" propaganda documents, including postage stamps and banknotes. Ellic Howe, the British master forger, wrote of his part in this project in The Black Game, Michael Joseph, London , 1982. He mentioned that the Psychological Warfare Executive (PWE) had controlled both black and white propaganda from 1941 until the end of the war. His own organization, the Fakes and Forgeries Unit did not become active until spring of 1942.

Howe had been a printer in civilian life, and according to Sefton Delmer, author of Black Boomerang, Viking Press, N.Y., 1962:

He had made a special study of German typography and printing techniques. Even before the war he had regularly visited Germany and made a point of collecting specimens of German printing. At the start of the war, Howe had been a lance-corporal in the Royal Engineers. In late September of 1941 he wrote a paper Political Warfare and the Printed Word - A Psychological Study. The paper brought him immediate attention and he was drafted by the PWE in the first week of November 1941.

Through the contacts he had made in civilian life he proceeded to make arrangements with Fanfare Press in London for printing, with Spicer's Limited for paper, and with Monotype Corporation for printing matrices. He stated that he could supply anything from a few forged letter headings to several million forged German ration cards.

[Note: I was contacted by Channel Four of the United Kingdom in 2004 to consult on a Television program about Howes wartime work and they advised me that they had found Howes original type in the Monotype Corporation archive].

Ellic Howe adopted the code name Armin Hull for the remainder of the war. When requested to produce a forged or parodied document, he would code the item with an H and a number. He claims to have produced about two thousand different propaganda documents during the war. The total number of items actually printed and disseminated behind enemy lines probably runs into the millions. Although the official listing of black propaganda materials prepared by the British is still a guarded secret, it is likely that the majority of the propaganda banknotes we will discuss in this article were directly or indirectly conceived by Armin Hull and his PWE cohorts.

The first British propaganda parody we will discuss is of the German 50 pfennig Behelfszahlungsmittel fur die Deutsche Wehrmacht (Auxiliary Payment Certificates for the German Armed Forces). There are four different propaganda messages on the back and they were given the PWE numbers H.692A-D. Since they were also prepared for balloon dissemination they collectively bore an additional identification Q38. Apparently the banknotes were popular. Howe printed them a second time with the code H.917. None of these codes appear on the leaflets. 10,000 copies of each were sent to the Special Operation Executive (SOE) on 24 February 1944. 80,000 were sent to the Royal Air Force on 1 March 1944. 210,000 of the reprinted H.917 leaflets were sent to the R.A.F. on 19 May 1944.Balloon drops occurred from 13 March to 16 July 1944.

The front of the British parody is an excellent copy of the genuine note except that the red and orange colors are just a shade duller. At first glance the fraud could easily pass a casual inspection. The British placed their anti-Nazi propaganda messages on the back of the parody. The genuine note had a blank back. Four messages are known, with German text typewritten in red on a white background. The first two messages appear double-spaced as quatrains:

H.692A

H.692A: My name is 50 pfennig - I'll cheat everyone out of 4.50 who believes Hitler will give him anything. H.692B H.692B: I am a piece of Hitlers ass-paper. Nobody accepts me because nobody can buy anything with me.

These quatrains were allegedly written by ex-Berliner Peter Seckelmann, who had left Germany upon Hitler's rise to power. Working under the code-name Paul Sanders, he broadcast to Germany on PWE's clandestine radio station, Gustav Siegfried Eins.

H.692D

H.692D: This variety of the parody bore both the first and second quatrains, single-spaced so that the eight lines could fit on the back of the 120 x 60mm leaflet:

I am a piece of Hitter's ass-paper. Nobody accepts me because nobody can buy anything with me. My name is 50 pfennig - I'll cheat everyone out of 4.50 who believes Hitler will give him anything.

The British were attacking and attempting to undermine this military currency because they knew that by regulation these notes were issued strictly to the armed forces. The notes were valued at ten times their face as long as they were used in a military establishment. If a soldier tried to use the note in the local civilian economy it was worth only face value. Thus, if he tried to go on the black market or purchase illegally outside of the military canteens and barracks he suffered a 90% loss. This unusual method was a safeguard against the general public attempting to acquire and use the military currency. It worked well for the German economy, but made an easy target for the British propagandists.

H.692c

I have gone out of order and placed the third printed note last. H.692c is very different from the other three, with seventeen lines printed in a small typeface. The message is:

This bill is a farce - just as the war is. With this piece of toilet paper, they want to pay for the soldier's blood - Soldier's blood, which carries on the war - the war which is continued only so that the big shots can get their loot out of the country. The high ranking officers, SS Big Shots, the Party racketeers and trustees can obtain as much hard currency as they want. With that, they can buy and send home anything they want. They live high on the hog in their illegal private clubs and can afford to pay fantastic prices for their food. But the troops only get this concentration camp money which they can only spend in canteens. The troops have to eat whatever the canteens want to get rid of because they can't spend this paper anywhere else. This bill is a farce, a bad check which can't be cashed - Just as everything else which we have been promised. End the War! End this farce!

Erik Gjems-Onstad says in Psykologisk Krigforing i Norge (Psychological Warfare in Norway), Sollia Forlag, Oslo, 1981, that 2800 of these 17-line 50-pfennig propaganda notes were received for distribution during Operation Durham in the Trondheim area beginning in March 1944 and ending in March 1945. There is a second report that they were airdropped on the German-occupied British Channel Islands in Autumn 1944.

The Falling Leaf (Journal of the Psywar Society) of March 1964 published a comment in regard to this currency campaign:

I have been told by an ex-RAF pilot that on one occasion he had to sign for several parcels as they were being loaded on his aircraft prior to an operational flight, with instructions that they were not to be opened until the target was close-approached. When the parcels were opened just before their dispatch, he found that they contained piles and piles of German money. This pilot cannot recall what money or value it was, but it was most certainly 50-pfennig notes for the German Army. These were lager notes for use by servicemen in canteens and barracks; they were worthless in the civilian world.

R.G. Auckland says in Air-Dropped Propaganda Currency, 1972 edition:

The original idea came from the Political Intelligence Department, but the technology and printing was done by a private firm under the strictest security. The printing staff put 5 percent by quantity into bombs already loaded with newspapers and/or leaflets so that a drop of one million units of propaganda would have fifty thousand 50-pfennig notes included. When supplies ran out, a phone call to PID would mysteriously produce further parcels of banknotes delivered from nowhere on the backs of nondescript lorries.

Charles Cruickshank mentions the banknotes and other forged documents in The Fourth Arm: Psychological Warfare 1938  1945, Davis-Poynter, London, 1977:

Black leaflets included a whole range of ingenious forgeries: posters purporting to be of German origin; currency notes; clothing coupons; ration cards; postage stamps....

Genuine 10 reichsmark 10 reichs mark parody

The next note we will discuss is more mysterious. It is a parody of the German 10 reichsmark Reichsbank note of 22 January 22 1929. The front of this parody differs quite a bit from the genuine note. The paper is green instead of the white found on the original. The engraving is also dull and obviously a reproduction. There is no serial number on the parody, and no red color in the center as found on the genuine. There is simply a general impression of the 10 mark note that might pass a casual inspection in very poor light. Because of the poor workmanship, some researchers doubt that this is a British production. It appears too crude to have come from Howes workshop. The typewritten text on the back is:

Souvenir of Hitlers  Thousand Year Reich. Hitler promised a thousand-year Reich. It lasted only ten years and is now drawing to a close. Only the oppression by your Nazi tyrants let it appear like a thousand years. Throw off your chains -- They will be punished -- and the people will be protected.

Perhaps the British purposely prepared the parody in this manner to make the Germans think that it was printed in their own country by a left-wing underground movement. It might be another in the long history of British and American plots attempting to confuse German security by having them constantly on the search for nonexistent, anti-Nazi movements. One clue that points to this note being a British production is that the propaganda on the back is typewritten just like that on the 50 pfennig notes. There were at least six German typewriters at Howe's forgery plant and it is possible that this note was prepared there. We know nothing of the background of this strange parody. It is believed that it was distributed in Germany sometime in 1944, but there is no proof.

The Rumor Campaign

In an attempt to raise the morale of occupied Europe and lower the morale of the German military, civilians and their allies, the secret British Underground Propaganda Committee produced well over eight thousand rumors, (they called them Sibs from the Latin sibalare  to hiss). Researcher Lee Richards mentions the whisper campaign and many of these rumors in his book Whispers of War, Psywar.org, 2010. In regard to British propaganda rumors about the Allied forging of German banknotes he lists dozens of moral-destroying rumors that attempt to make the Germans lose faith in the value of their own currency. I have selected a few of the more interesting ones:

24 September 1943  The German Government has taken no steps about the millions of forged mark notes which have been dropped by the Royal Air Force which shows what they think about the value of the mark. 25 March 1944  Over 100,000,000 marks, specially printed, have been dropped by aircraft on various parts of Germany since the beginning of 1944. The Reichsbank have made no comment and has not shown any concern. 16 March 1945  Leading German bankers are trying to dissuade the Reich government from their current inflation policy on the grounds that it will upset the intended Allied plan for stabilizing the mark at 40 to the British pound or 10 to the U.S. dollar when Germany is occupied.

Genuine 50 Franc note

British propaganda of French 50 francs note

The next British propaganda leaflet is a caricature of the French 50 francs Bank of France note. This note is "white" propaganda and makes no attempt to fool the French people or appear genuine. It is code numbered 90 and is mentioned in the official British publication, A Complete Index of Allied Airborne Leaflets and Magazines with the following listing, Bank of France, first dissemination 10/11 June 1941, last dissemination 12/13 June 1941. Two dates are given for each airdrop since the missions were flown overnight. A bomber leaving on 10 June would return on the morning of 11 June.

The British made no attempt to closely imitate the original currency. The genuine is multicolored, while the parody is brown on white paper. Where the signatures should be, we find in French The traitor Laval and The spy Abetz. There are small smiling caricatures of Hitler and Laval at the top of the columns at left and right. A shocked Jacques Cover is depicted in the vignette writing on a piece of paper that reads, Daily cost of occupation 400,000,000. At the bottom there is a tablet engraved, To the plundering Boches nothing is impossible. The serial number is 26.6.1940; the day the collaborator Laval was named vice premier of France and General de Gaulle announced the formation of the French National Committee in London .

On the back there is a long propaganda message in French attacking the cost of the German occupation forces stationed in France :

Here is a vignette that is fitting for the new 50 francs notes, for it illustrates the history of the systematic pillage of France, pillage made according to a well thought out plan. First of all, the occupation costs 400,000,000 francs a day. As there are at this moment almost one million Boche soldiers in France , that is 400 francs per day, per soldier. That is double the entire cost of living in luxury on the Cote dAzur . The 400 million a day represents double the entire budget for all of France - although there are 40 million Frenchmen. Each German is costing the Treasury as much as 80 Frenchmen. Of course, the Germans do not spend 400 francs a day for each soldier. Fine wines and extravagant dining are reserved for officers and agents of the Gestapo. The Germans save more than two-thirds of this amount and with the savings buy French businesses. In this way they count on reducing all of France to economic slavery. This is not all. While obliging Frenchmen to accept their Reichskreditkassenscheine at 20 francs a mark - although it wasn't worth even 6 francs before the Armistice - they force the Bank of France to print paper francs endlessly. These are the same Boches who, over the years, bewailed the payment of reparations!

We will remember all this on the day of final reckoning.

These propaganda notes are punched with a small hole. This hole was used to run a fuse to a balloon. The notes were sometimes floated over France , and the slow-burning fuse released them over a wide area.

Curiously, a British file has been found that mentions this very propaganda theme. In a Foreign Office letter dated 25 April 1941 filed under Propaganda suggestions we find some of the following statements:

The reports we have seen about the Franco-German negotiations, which are believed to be proceeding revive the suggestion of last autumn that one of the German concessions may be the reduction of the cost of occupation. I think it would be a good thing if our French propaganda fastened onto this on something like the following lines. After referring to this report, the speaker would go on to say that the crushing burden of 400 million francs a day in addition to the usual German robbery of supplies and anything removab