This excerpt from a United States Secret Service internal publication was faxed to First Lady Hillary Rodham Clinton’s office in preparation for a speech she would give to a special agent training class.
It conveys information that during the Civil War in 1861, the Federal Government began printing money. Prior to this, the U.S. Treasury had never issued paper dollars, relying instead on coins and paper banknotes. A hastily created paper currency used throughout the Union (and much of the Confederacy) made it a target for counterfeiters. By the end of the Civil War, one in every three bills was fake. At some points during the war, a dollar bill was only worth 34 cents due in part to counterfeiting schemes.
On April 14, 1865, President Lincoln created the Secret Service to purge the country of counterfeit bills. Ironically, the Secret Service was created on the same day of President Lincoln’s assassination. It would take 36 years, two more Presidential assassinations, and an Act of Congress before the Secret Service assumed the responsibility of protecting the president. In between that time, money was its sole focus.
The threat of counterfeit currency was real – hyper-inflation could destroy prospects of Reconstruction and exacerbate financial hardships caused by the war. Using a crew of 10, some of whom were reformed counterfeiters themselves, the Service’s first director William P. Wood set out to clean up America’s currency. By 1869, the Secret Service had arrested over 200 counterfeiters and opened 11 offices across the country.
