Is the US $20 bill the most counterfeited?

Question

In a comment on "Is it illegal to refuse US currency for a purchase?", @Dan Neely said

I don't think the main reason many businesses ban $50/100 bills is that they'd deplete their ability to make change for future customers. Minimizing losses from counterfeiters is the dominant concern.

Given the higher prevalence of $20 bills over $50 or $100 bills, I have always heard that the $20 is more frequently counterfeited in the US.

Is this true?

Gizmodo makes a throw-away claim that the $100 is the most counterfeited but with no sources.

Answer 1

Yes and no, while the $20 note is the most commonly encountered counterfeit bill in the United States, the $100 note is the most common counter fit bill in worldwide circulation.

It appears that the $20 note is typically the bill most likely to be attributed to being counterfeited in various factoids without that distinction. However, in journalistic articles that feature quotes attributed to representatives from the United States Treasury Department and the United States Secret Service the $100 note is cited as the most commonly counterfeited in world wide circulation.

The worldwide circulation is the interesting aspect of this answer as there are a number of different techniques that are used by well-funded organizations for counterfeiting (from bleaching US$5 bills to turn into $100 note to making new ones with stolen engravings) that tend to provide indications as to where the bills are being produced.

Counterfeiting is a big enough issue that the Federal Reserve periodically releases reports about the problem. In a report issued in January 2000, one of the key findings was as follows:

... the denomination with the largest amount of counterfeits, both in dollar terms (about $6 million) and as a proportion of notes processed (about 60 per million notes), was the $100 note.¹

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1. See page 52 - 53 which includes a table summary of counterfeiting rates at Federal Reserve banks.

Answer 2

TL;DR: $100 notes are counterfeited more overall, but there are more low-quality $20 forgeries than low-quality $100 forgeries (by count, but not by face-value).

The study Estimating the Volume of Counterfeit U.S. Currency in Circulation Worldwide: Data and Extrapolation contains a long evaluation of the problem.

Unfortunately, due to an unexplained error, the tables are omitted.

Through private communication with the lead author, Dr Ruth Judson, I have obtained another copy of the report. She states:

The wording at some points might vary slightly, but the tables should be the same.

The study explains the term "circular":

“Circular” notes are those that are assigned classification numbers by the U.S. Secret Service for further investigation. They are typically of higher quality than the other categories of counterfeit notes, which include those printed on office copiers or computer printers or other relatively crude methods.

In Table 6, we see the essential information:

Remember that, $1,000 worth of $20 notes is five times more notes that $1,000 worth of $100 notes.

From this table we can see that when it comes to higher-quality "circular" counterfeits, the $100 notes dominate, even after multiplying five. For the lower quality forgeries, there are more $20 notes, but they don't add up to as much value as the $100 notes.

Adding both groups together, the $100 notes win when it comes to count and value.