MILITARY PAYMENT CERTIFICATES
September 16, 1946 was the beginning of an era of a colorful and exotic issue of paper money in United states history. Military Payment Certificates (MPC’s) were first introduced in Europe at this time.
Although World War II was over, troops still remained to maintain order and assist in rebuilding. It had been government policy to pay servicemen in the currency of the country in which they were stationed . In postwar Germany it was the Mark issue of Allied Military Currency. At that time a soldier would he able to convert local currency into U. S. Dollars. The problem was the U. S. Government was converting far more Marks or other local currencies than it initially paid out in wages. The deficit had grown to $530,775,440 by the time the first MPC’s were put into circulation.
The problem with a free flowing dollar is that it begins to dilute the currency of the foreign country it is being used in. A Black Market exchange was clearly taking place. The need for a scrip currency was certain. The problem was more critical in Europe than in the Pacific or Mediterranean Commands, but in order to be successful all overseas military personal would need to be a part of the MPC system.
Joint hearings before the Senate committees on appropriations, armed services, and banking, during the first session of the 80th Congress put Military Payment Certificates into the development stage. Previous attempts at currency control had all failed to prevent the excess accumulation of foreign currencies.
The complete set of 90 notes started in 1946 and remained in continuous use through 1973. The most effective point was that a set or series of notes that included fractional and whole denominations would be put into use for a limited period of time and then be recalled and exchanged for a new series of notes. The trick was that these conversion days were kept secret and only revealed the day that the exchange would take place. The previous series would be deemed as worthless after C-day. If you failed to exchange your notes then you lost their value.
This was not a very pleasant experience for profiteers or black marketers since they could stand to loose large sums of money. On conversion day the military bases were sealed off until the next day when the next series would take effect. Although the problem was not completely eliminated, it did put the deficit at a more manageable level.
The Bureau of Engraving and Printing was responsible for producing the notes, but with so little time to design, produce, and deliver by September of 1946, the actual printing was done by private contractors, Tudor Press and Forbes Lithographic Corporations. These companies shared the printing duties through the first seven series of notes until 1961.
Military Payment Certificates were printed by lithography which was a less expensive route than the intaglio method of U. S. currency. Counterfeiting was not a major concern since other methods were put into play as a prevention. The short lifetime of a particular series was in itself n anti-counterfeiting device. The careful selection and combination of colors and the fact that one color was printed over another to give the notes their composite finished appearance was a counterfeiter’s nightmare. Small discs of colored paper were imbedded in the paper stock on which the notes were printed. This was called planchette paper. Ultraviolet ink was used and although this is a popular method on foreign currencies today it was a new innovation in 1946.
The numbering used on MPC’s is slightly different that that used on today’s currency. The largest number is the serial number. It consists of eight digits along with a prefix and suffix letter. The series number is denoted as such and is three digits. The first being the #461 series of 1946 and continuing for a total of thirteen different series of notes that ended with the #692 series of 1970. This means that on thirteen different occasions a conversion day was enacted through the history of the notes.
The other single or double digit number is a position number and not a plate number as one would be inclined to believe. This number indicates the location of a particular note on the printing plate. (There is no plate number on a finished certificate.) Position number 1 would indicate that this note would have the top left corner location on a plate. If you were to have a group of consecutive serial numbers then the position number would be the same.
Designs started out quite plain for the first three series (#461, #471, and #472). In the beginning not much concern was given toward creating an elaborate design. Time was short and deadlines had to be met. As the different series continued, quite a bit more creativity was used. Some of the designs borrowed features from other currencies, stamps, photographs, statues, or buildings. For instance, the $1 #481 series note features part of the facade of the National Archive Building. The #641 and #651 series borrowed a vignette from the $2 educational series notes of 1896. The back of the $1 #661 series uses the mirror image of Mount Rainier taken from the 1934 3-cent postage stamp. These are just a few of many examples of borrowing design elements.
Most notes can be acquired in nearly all grades including uncirculated. Although many notes were produced, one must keep in mind that they were also systematically destroyed. The larger denominations are the most scarce. A soldier would make sure that he redeemed his larger bills and would more likely miss or purposely save some of the fractional denominations. There are about seven notes that are extremely difficult to obtain and the prices bear this out. In uncirculated condition, the $5 #471 series is king with a price of $7,500. Second is the $5 #541 costing around $4,500. The $5 #591 sits at about $4,000 with the $10 #471, $5 and $10 #521 at $3,000 each along with the $10 #541 note.
MPC’s, as in most numismatic series, also contains its share of notes that are exceptions to the rule. For instance, there are the #691 and #701 series of notes that were produced but never issued. As far as the collecting community is concerned none of these notes are in a private collection. Sounds like the 1964 Peace Dollar story! The #651 series has the mystery of the fractional notes. For years it was believed that no fractional notes were issued until a set was sold in 1985 and another set at the 1987 ANA auction by Bowers and Merena. Maybe more sets are out there waiting on the wings.
Additional scarcities are found in the replacement notes. Like star notes, these were produced to replace any notes spoiled during production. This kept the accountability of the notes in order. Replacements can be identified by the lack of a suffix letter at the end of the serial number. These notes bring substantially higher prices than their regular issue counterparts.
MPC collecting can lead into a variety of other related topics such as concentration camp money, allied currency, invasion money, propaganda notes, military tokens, etc. Exhibiting these notes always seems to rekindle nostalgia. These small pieces of paper money taken for granted, now are memories of exotic and far off places, of horrible defeats and glorious victories., of youth and vitality. It is a thrill to watch as someone walks past an exhibit of MPC’s, stops abruptly, does an about face, and says "Hey, look at this. I remember them." Happy Birthday America, we’ll never forget! (July 4, 1990)