While it may be more commonplace to pay for items with debit cards, it’s important to have access to physical cash, especially during natural disasters or other crises. However, bills are susceptible to damage when they are kept on hand. The most common causes are fire, water, chemicals, and explosives; animal, insect, or rodent damage; and petrification or deterioration by burying.
These types of bills are labeled mutilated currency. It has been damaged to the extent that one-half or less of the original note remains, or its condition is such that its value is questionable.
Whether bills are torn, worn, limp, mildewed, dirty, defaced or burnt, there are different processes for handling money depending on what happened to it.
As long as more than half of the original note is clearly present and it doesn’t require special examination to determine the note’s value, any commercial bank can include the note in its deposit to the Federal Reserve. If it is declared to be unfit, it is separated from normal circulation.
Because the Federal Reserve does not accept deposits of mutilated currency from banks, a special examination is required at the Bureau of Engraving and Printing before any exchange is made.
If you have a mutilated bill, directly contact the Bureau of Engraving and Printing (BEP). A form must be completed regardless of the condition of the mutilated currency. Take care not to disturb the fragments any more than necessary. If the mutilated currency is brittle or inclined to fall apart, pack it carefully in plastic and cotton without disturbing the fragments and place the package in a secure container. Fragments should be shipped to the bureau in Washington, D.C.
Lawful holders of mutilated currency may receive a redemption at full value when:
Clearly more than 50% of a note identifiable as United States currency is present, along with sufficient remnants of any relevant security feature; or
50% or less of a note identifiable as United States currency is present and the method of mutilation and supporting evidence demonstrate to the satisfaction of the BEP that the missing portions have been totally destroyed.
Contaminated currency is any money that may be exposed to contaminants to the extent that it cannot be processed under normal operating procedures or may pose a health or safety risk if processed. Paper bills can become contaminated due to:
Prolonged exposure to moisture, resulting in mold
Exposure to sewage or animal waste
Exposure to blood, urine or any other bodily fluids, including removal from any body cavity, corpse or animal
Exposure to a chemical, liquid or foreign substance that may pose a health hazard or safety risk
Exposure to tear gas
One must never deposit currency believed to have been or definitely exposed to fentanyl. If you possess any notes that have such exposure, contact the local branch of the Federal Reserve to gain guidance about how to process the bills.
If you have contaminated currency, contact a local commercial bank and provide as much information as possible about what happened to the bills. The branch officials will provide further instructions about handling and whether consulting with the Federal Reserve is necessary.
Contaminated currency must be double-bagged, and the bags must be large enough to permit the movement of the currency inside the bag for initial visual inspection. The word "CONTAMINATED" must be written in large text and in permanent marker on the outside of the outer bag. Any exterior printing on the bags must not inhibit the view of the bagged contents.
