Paper Money of Chihuahua

.. by Simon Prendergast

  • Increase font size
  • Default font size
  • Decrease font size

Counterfeit Ejército Constitucionalista notes

The Ejército Constitucionalista were widely counterfeited and many of the notes that still exist must be bogus but though there is an obvious tendency to consider a finely lithographed note as genuine and the poorly delineated as counterfeit the matter is far more complex. Counterfeited revolutionary issues were often better than the original article.

The authorities occasionally tried to dampen public disquiet about counterfeit notes. For instance, on 15 September 1914 it was reported that large number of  counterfeit $5 notes were circulating in Guadalajara, Mexico City and other areas of the countryBoletín Militar, 15 September 1914. The notes had been printed in Washington. In late September the Presidente Municipal of Magdalena, Jalisco, wrote that, because of press reports of counterfeits,  businesses and individuals were refusing to accept Ejército Constitucionalista notes and wanted instructions (AJ, Hacienda 1-914  letter received 23 September 1914) and the next week the Presidente Municipal of Tequila wanted to know what to do with people who refused to accept $5 notes believing them to be false. He was told that they were not counterfeit and of forced circulation (AJ, letter received 30 September 1914), but this was later denied so the ‘counterfeits’ must have referred to the C/Y controversy (see below and Counterfeit $5 notes type 5). On 30 September 1914 the Governor of Jalisco, Manuel Aguirre Belanga, declared all Ejército Constitucionalista notes to be of forced circulation, whether they had a white, black, green, striped background or not, and claimed that there was no such falsifications but merely poor impressions made in different printingsBoletín Militar, 30 September 1914: México Libre, 1 October 1914. In April 1915 Sub-secretary Manuel Padilla, in an interview on current rumours about the Ejército Constitucionalista, said that although many people were refusing to accept the ‘C’ notes on the grounds that they were forgeries, these and other details such as a whiter sky or horizontal lines were merely the result of different print runsMexican Herald, 4 April 1915. Following the Mexican Herald report, because people still refused to accept the ‘C’ $5 notes, they used them to pay their taxes. The cajero of the municipal treasury in Mexico City, Fernando Olloqui, reported that the amount he held was growing daily and asked whether he should continue to accept them. The query was passed on to the Secretaría de Hacienda, who confirmed that both issues were of forced circulation (AAM, Hacienda General, Volumen 2116, exp 725, letter Tesorero General to Presidente Municipal, 14 April 1915; letter Presidente Municipal to Secretario Interino, 23 April 1915; letter Padilla to Presidente Munivipal 11 May 1915). . On 11 May 1915 in response to a query occasioned by his interview to the Mexican Herald Padilla confirmed to the Presidente Municipal of Mexico City that both the ‘Y’ and ‘C’ notes were of forced circulation, the difference being attributed to the fact that they were from different issuesAAM, Hacienda General, Volumen 2116, exp. 725 letter from Padilla to Presidente Municipal, Mexico, 11 May 1915. A few weeks later the Governor of the Federal District, Gildardo Magaña, reaffirmed this, with specific reference to the $5 noteEl Monitor, 27 April 1915, La Convención, 28 April 1915. However, on 29 May 1915 the Comandante Militar in the Distrito Federal again had to insist that the $5 Ejército Constitucionalista was of forced circulation, as businesses had begun to refuse them because of the two different typesEl Monitor, 30 May 1915. On 18 December 1915 Gabriel Vargas, Jefe de Hacienda in Guadalajara, reiterated that these ‘fondo blanco’ or ‘de la C’ were of forced circulation, in accordance with the circular núm. 58 of the Secretaría de Hacienda y Crédito Público, dated 12 December 1915 (actually circular núm. 48, dated 1 December 1915)Boletín Militar, 18 December 1915.

On 15 December 1915 Emilio García was instructed to review the notes in the Administración General de Rentas in Querétaro. The next day he examined $116,000 and found that $2,721 was counterfeit, comprising $126 in Monclova, $1,780 in Gobierno Provisional, $395 in Pagaduría General del Cuerpo de Ejército del Noroeste and $420 (34  $10 and four $20) in Ejército Constitucionalista. The Governor suggested recovering this amount proportionately from the employees in charge of collection (recaudación) since it was their fault, but when they complained, the governor ordered a new review of the $2,721 and on 29 January the amount to be recovered fell to $30 as only one $10 and one $20 of the Ejército Constitucionalista were blatantly counterfeit (por lo burdo de la falsificación). Though the others were counterfeit there were no rules by which to check themAQ, Fondo Poder Ejecutivo, Sec 2ª Hacienda C-4 Año 1915, exp. 353. The incidence suggests how difficult it was for anyone but experts to recognise counterfeits (and also a good motive for not doing so).

We can construct tables of the various characteristics that were claimed to indicate counterfeits, though when officials drew up their lists any noticeable differences tended to be considered suspect, even when, as in the C/Y controversy, they might have been attributable to different printings. We can also study the notes that were perforated or overprinted FALSO, though counterfeits were also returned to their holders with no markings and genuine notes could have been mistakenly marked FALSO. Similarly, any note that carries a resello has a presumption of genuineness but unfortunately, there are several complaints (though none specifically dealing with Ejército Constitucionalista notes) that agencies had revalidated counterfeit notes.

It seems that the counterfeiters tried to mimic the genuine control sequences but there are notes where the serial number does not agree with the control code, and for these there must be a presumption that they are forgeries.

As with the sábanas it is tempting to believe that with the benefit of time and given a large enough sample we could make a better job nowadays of distinguishing the bogus notes than any official of that time.

Reports of counterfeit Ejército Constitucionalista notes

In October 1914 R. B. Hopkins, H. H. Smith and Alberto Sammons were arrested on the prompting of the Mexican consul in San Antonio, Teodulo R. Beltrán. They had tried to sell $10,000 in counterfeit money to a Joe Cloud at a rate of 10c on the peso. A search of their home found  $27,000 in $5  Ejército Constitucionalista notesLa Prensa, 30 October 1914: Regidor, 4 November 1914. On 27 November R. Beltrán, vice-consul (sic) in San Antonio reported that he had arranged the arrest of some counterfeiters of Constitutionalist currency, in the first case having decommissioned a large quantity of bogus notes, and in the second the plates, paper and Chihuahua notes (las piedras litográficas, papel e impresión de billetes de Chihuahua) (               ).

In spring 1915 many suspicious Ejército Constitucionalista notes appeared in the market in Colima. Upon investigation it appeared that the firm of Welbecks & Company, general commission merchants of San Francisco, California, had delivered $60,000 of these notes to a merchant in Colima, and that the latter, with or without criminal intent, had put them into circulation. The Constitutionalist government recovered $30,000 from merchants and ordered for all the spurious notes found in the market to be taken in. The Governor of Colima was afraid that a large quantity of these notes had been printed and that several thousand pesos might be taken into Mexico by way of the Pacific portsSD papers, 812.5158/25 report of Douglas, Ruffin & Obear, Attorneys, Washington to Secretary of State, 1 June 1915.

On 15 June 1915 Luis Pruneda, the Inspector at the government printing works, reported that they knew of one type of counterfeit $1, three types of counterfeit $5, five types of counterfeit $10 and one type of counterfeit $20 Ejército Constitucionalista notesCONDUMEX, Fondo XX1, carpeta 43, legajo 4641.

In August 1915 a Charles McLean was arrested in Galveston, Texas and accused of possessing and offering to pass counterfeit $10 and $20 Ejército Constitucionalista notes (and $100 Gobierno Provisional notes).The complaint was made under sections 156-160 of the Penal Code of 1910 but the U.S. attorney, John E. Green, jr. declined to prosecute, as the defense contended that Mexico was not a "foreign government", as contemplated in the sections referred to. The U.S commissioner, John C. Walker, wrote to the State Department for advice on whether he should hold Mr. McLean to bondSD papers, 812.5158/28, Walker to Secretary of State, 30 August 1915 and the State Department replied that it had taken no action in recognition of the so-called Constitutionalist Government in Mexico as a "foreign government" and that the Department of Justice had therefore concluded that there appeared to be no federal statutes under which action could be taken against people engaged in such counterfeitingSD papers, 812.5158/28 Second Assistant Secretary, Alvey A. Adee, to Walker, 16 September 1915.

On 9 October 1915 the Jefe de Hacienda of Monterrey reported to the Provisional Governor that some soldiers had false Ejército Constitucionalista that they claimed to have received from their paymasters. The Governor passed the report on to the Jefatura de Armas for investigationANL, exp 125, telegram 550, 5 October 1915.

On 17 November 1915 the Administrador General de Rentas of Querétaro reported that $165 (31%) of $535.81 paid in by the Junta Patriotica in Gobierno Provisional and Ejército Constitucionalista had turned out to be counterfeitAQ, Fondo Poder Ejecutivo, Sec 2ª Hacienda C-4 Año 1915 exp. 309.

On 16 December 1915 the Governor of Coahuila asked the Contador to inform the Presidentes Municipales of Sabinas and San Juan de Sabinas and all the Recaudadores de Rentas how to distinguish the counterfeits. The Contador passed the request onto the Jefe de Hacienda.

On 31 January 1916 the Presidente Municipal of San Luis Potosí reported a counterfeit $10 Ejército Constitucionalista C 265366 C-VI VI-C . It had poor thick printing and the stars over DIEZ on the reverse were indistinctSan Luis Potosí, Ayuntamiento 1916.11 exp. 18.

On 21 March 1916 large quantities of bogus $5 and $10 Ejército Constitucionalista appeared in Guanajuato. The Tesorería General restamped the good notes and invalidated the forgeries, which caused great alarm as those holding the useless notes lost their money.

Counter measures

The Constitutionalists' efforts to combat counterfeiting in the States were led by Jesús M. Arriola. Arriola was an experienced pressman and accomplished lithographer. Between 1904 and 1911, he had worked for various printing firms in El Paso, where, during the latter year, at least, he also served as a spy for the Porfirista consul, Tomás Torres. During April and May 1911, Arriola was one of several agents who submitted to Torres daily reports on rebel activities in and around El Paso, where Francisco Madero maintained his headquarters. After Ciudad Juárez fell, Torres sent Arriola to Los Angeles to participate in the surveillance of the Magonistas. Apparently Arriola was attached to the Los Angeles consulate throughout the Madero regime but lost his position when Huerta came to power in 1913. In late 1914, the new Carrancista consul, Adolfo Carrillo, reinstated him. In early 1915, Ramón P. de Negri recruited Arriola to head the 'Mexican Bureau of Investigation', a detective agency that de Negri surreptitiously financed AHSRE, L-E-837(11), de Negri . Arriola’s immediate task was to pursue counterfeiters who were producing phoney Constitutionalist notes. His experience as an undercover operative for both Díaz and Madero, his skill as a lithographer, and a unique combination of courage, audacity, and deceit enabled him to penetrate the operations of the sundry Mexicans and North Americans who were printing the bogus money. Working in conjunction with agents of the United States Secret Service in California, Texas, Colorado, Missouri, Tennessee, and Louisiana, he helped gather evidence that allowed federal authorities to confiscate tens of millions of pesos in counterfeit notes and arrest dozens of people passing the spurious notes. Impressed by Arriola's success, de Negri recommended that Candido Aguilar, Secretary of Foreign Relations, appoint him to head and reorganize Mexican intelligence operations in the United StatesCONDUMEX, Fondo XX-I, 13904, Memorandum of Arriola, 5 July 1918; Investigative Case Files of the Bureau of Investigation, 1908-1922; Investigative Records Relating to Mexican Neutrality Violations ("Mexican Files"), 1909-21," Microfilm Publication M1085, National Archives, Washington, D.C. - Arthur M. Allen, San Francisco, California, 20 July 1915, Roll 856; E. M. Blanford, Los Angeles, California, 16 December 1915, Roll 856: U.S., Department of the Treasury. United States Secret Service. Daily Reports of Agents, 1875-1936. Record Group No. 87. Microcopy No. T915. Records of the United States Secret Service. General Services Administration, 1952 - Henry M. Moffitt, San Francisco, 15 February 1916, Vol. 11, Roll 766; Edward Tyrrell, San Antonio, Texas, 6 March 1916, Vol. 12, Roll 751; George W. Hazen, Los Angeles, California, 13 April 1916, Vol. 31, Roll 531; Sheldon Bovee, El Paso, Texas, 26 February 1916, Vol. 2, Roll 490.

In October 1915 the Carranza government consulate in El Paso launched a vigorous campaign against counterfeiting.  Enrique Gutierrez, an expert in detecting fake paper money, arrived from Mexico City and big placards were stuck up all over the city warning labourers and others against accepting Carranza currency without first consulting the local office of the governmentEl Paso Herald, 27 October 1915.

In January 1916 Arriola trapped Robert Widney in Los Angeles. He paid Widney $3,500 in American money in exchange for some fictitious currency and got him arrested. Widney had agreed to supply Arriola with $600,000 more of the counterfeit Carranza money the following day and a million more in a few daysThe Deseret News, 6 February 1916.