Treasury Today Country Profiles in association with Citi

Final frontier for criminal gang: $6 trillion of counterfeit bonds seized

Vulcanica, rather than being a fetish for Star Trek’s Mr Spock, is a genus of moths of the Noctuidae family. There are close to 1,450 species of the winged insect found in Europe. It also happens to be the name of the covert operation under which a haul of allegedly fake US treasury bonds – with a face value of $6 trillion – were recently seized in Switzerland.

At the behest of anti-mafia prosecutors, a year-long investigation by Italian and Swiss authorities has unravelled fraudulent activity that the US embassy in Rome has described as a potential ‘severe threat’ to international financial stability.

Eight people have been arrested on the charge of counterfeiting the securities, dated 1934. Their face value reportedly equates to over a third of US national debt. The forgeries were seized in January from a Swiss trust company in Zurich where they had been concealed in hidden compartments in three large safety deposit boxes.

The (as yet) unnamed individuals were reportedly planning to use the fake securities as collateral to procure loans in a number of Swiss banks. However, their scam was foiled as authorities were alerted due to the ‘astronomically’ high denominations of the bonds – a common mistake among European forgers unfamiliar with the face value of US treasury bonds apparently.

The US embassy in Rome has examined the certificates and, somewhat casually, thanked the Italian authorities via Twitter.