FORGET FAKE IDS. NOW STUDENTS ARE PASSING PHONY MONEY; NEW TECHNOLOGY MAKES COUNTERFEITING CHILD'S PLAY.

Byline: Greg Gittrich Staff Writer

Thousands of dollars in counterfeit currency has been spent at Los Angeles Unified school cafeterias and bookstores, prompting the district's top investigator to team with the U.S. Secret Service to find the bogus money makers.

In recent months, fake $20, $10 and $5 bills have been showing up regularly in schools, and most cashiers aren't trained to spot the bogus bills, said Don Mullinax, director of the LAUSD Internal Audits and Special Investigations Unit.

``It's an easy way to launder money,'' Mullinax said. ``A student uses a fake $20 bill to buy a candy bar and comes away with $19 that are clean.''

``They can then use that real money on the street. The district ends up taking the loss when we try to deposit the fake money at a bank.''

The nation's second-largest school district has no estimate of how much phony money has been circulated at its campuses, but Mullinax and federal agents said there are probably thousands of counterfeit bills changing hands around schools.

With a proliferation of relatively inexpensive, high-quality color copiers and printers, the investigators believe enterprising students have used home computer systems to print illegal loot.

U.S. Secret Service agents in Los Angeles seize about $80,000 a week in counterfeit money from the streets of Los Angeles, some 70 percent of which is computer generated - as opposed to produced on an offset printing press, the more traditional process.

``Counterfeiting is not something that anyone should be playing with,'' said Tony Meeks, chief deputy assistant to the special agent in charge of the U.S. Secret Service's Los Angeles office. ``You can't print your own bills to use as funny money. You can't do it for kicks.''

Juveniles busted for pawning off counterfeit currency as the real thing face stiff fines and possible jail sentences, depending upon the amount of fake money being distributed, officials said.

In most cases, if not every case, the Secret Service will confiscate the technology used by the juvenile to counterfeit the money.

``It doesn't matter if the kid owns it or the parents own it,'' Meeks warned. ``We will take the equipment. You will lose it.''

At Mullinax's request, Secret Service agents, who have the responsibility for investigating counterfeiting, will launch a campaign to teach the district's financial managers, administrators, teachers and students how to spot the phony money. The first seminar will be held Wednesday at Eagle Rock High School.

``This is a real proactive step, because we have no idea how much counterfeit currency is in the school district,'' Mullinax said. ``We have not found tons and tons of counterfeit currency, but we have seen a consistent amount of it.''

``We want people to know we are looking at this,'' he said. ``Don't even think about bringing counterfeit money into our schools.''

The best way for an average person to detect a counterfeit bill is to compare a suspect bill to a genuine bill, Meeks said.

``So few of our citizens really know their money. So many people can't tell a counterfeit from a genuine bill,'' said Meeks, a 17-year law enforcement veteran.

``We're going to the school district at least initially to teach people how to detect the counterfeits. Particularly with our new style of currency, it's important to familiarize yourself with what's on our money,'' he said. ``Education is one of our best assets in combating counterfeiting.''

Genuine bills usually have a crisper texture because of the high-cotton-content paper used by the U.S. Treasury, officials said. The real money also will have a straight, thin security stripe running from top to bottom of the bill, just left of the portrait. The stripe is visible when the bill is held up to the light.

``It gets easier every day to counterfeit money with the new improvements in computer technology,'' Meeks explained. ``These kids are smart enough to know how to use the computers. You'll catch them, and they say they were just playing around.''

Know your money

To recognize counterfeit bills, take note of these elements:

PORTRAIT: The genuine portrait stands out distinctly from the background. The counterfeit portrait is usually lifeless and flat. On fake bills, details merge into the background, which is often too dark or mottled.

FEDERAL RESERVE AND TREASURY SEALS: On a genuine bill, the saw-tooth points of the Federal Reserve and Treasury seals are clear, distinct and sharp. The counterfeit seals may have uneven, blunt or broken saw-tooth points.

BORDER: The fine lines in the border of a genuine bill are clean and unbroken. On a counterfeit, the lines in the outer margin and scrollwork may be blurred and indistinct.

SERIAL NUMBERS: Genuine serial numbers have a distinctive style and are evenly spaced. The serial numbers are printed in the same ink color as the Treasury Seal. On a counterfeit, the serial numbers may differ in color or shade of ink from the Treasury seal. The numbers may not be uniformly spaced or aligned.

PAPER: Genuine currency paper has tiny red and blue fibers embedded throughout. Often counterfeiters try to simulate these fibers by printing tiny red and blue lines on their paper. Close inspection reveals, however, that on the counterfeit note the lines are printed on the surface, not embedded in the paper. It is illegal to reproduce the distinctive paper used in the manufacturing of United States currency.

Source: United States Secret Service

CAPTION(S):

2 photos, box

Photo: (1 -- color) LAUSD Internal Audit and Special Investigations Director Don Mullinax displays counterfeit money passed in a school cafeteria.

Phil McCarten/Staff Photographer

(2 -- color) Phony $20, $10 and $5 bills have been showing up in schools recently, and most cashiers aren't trained to spot the bogus bills.

Phil McCarten/Staff Photographer

Box: Know your money (see text)