Counterfeit Monclova notes

Information on counterfeit Monclova notes can be garnered from contemporary reports and from a study of the notes themselves. Although they are good indicators, it is not necessary that a note with a resello is legitimate or that one marked 'FALSO' or otherwise cancelled is counterfeit.

False signatures on genuine notes

In classifying counterfeits we need to distinguish those genuine notes that appeared in northern Sonora with false signatures and were branded 'counterfeit' and the other attempts at imitating this issue.

A later newspaper article^{Bisbee Daily Review, 28 November 1914, though the article mistakenly refers to the notes as “Aguila”} explained why, in other parts of Mexico, other than Sonora, where the issue was generally accepted, it was regarded as counterfeit. “S. Aguirre, then acting treasurer-general of Carranza’s cabinet, signed the money jointly with Francisco Escudero, chief of the department of hacienda. He had a rubber stamp bearing a facsimile of his signature made and this was used on thousands of the bills until it wore down to the point of illegibility. Aguirre then began signing with a pen, but soon developed a case of writer’s cramp. The idea then occurred to him and was acted upon, of sending bills to the various prefectos of the state of Sonora, authorizing each to sign his name to the money. This was done and the resulting signatures were so unlike that of Aguirre that anyone could forge and “get away with it.” This resulted in a new issue of counterfeits, or what purported to be such. Money received through supposedly legitimate channels was seized by the government and for a time the ruling was made that in order to make any bill genuine, it would have to be stamped with the seal of the prefectura of the district. This inflicted a great hardship upon the people, many of whom although living more than 100 miles from the nearest prefectura, had to make the trip to the capital of the district to have the currency in their possession stamped with the official seal. The ruling was again changed and the state of Sonora guaranteed all the currency, whether stamped or not.”

On 7 February 1914 the Prefecto of Cumpas wrote that he had a $50 note with Escudero’s signature in facsimile. He wanted to know if notes greater than $10 with facsimiles were good^{AGHES, Fondo Oficialidad Mayor, tomo 2993 telegram Prefecto, Cumpas, 7 February 1914}. Maytorena passed the query on to Carranza’s Secretaría de Hacienda in Nogales^{AGHES, Fondo Oficialidad Mayor, tomo 2993 telegram Maytorena, Hermosillo to Esquerro, Oficial Mayor encargado de despacho de la Secretaría de Hacienda, Nogales, 10 February 1914} who replied that notes up to the $20 value had two facsimile signatures whilst higher valued had a facsimile of Escudero and an actual signature of Aguirre^{AGHES, Fondo Oficialidad Mayor, tomo 2993 telegram Esquerro, Nogales, to Maytorena, Hermosillo, 10 February 1914}.

On 11 February the Dirección General de Timbre in Durango reported to the government that $1 and $5 Monclova notes with manuscript signatures had appeared and that Carranza had ordered them to be collected as the genuine notes had stamped signatures. The message was passed on to the oficinas de Hacienda^{ADUR, Libro Copiador 267, Hacienda 11 July 1913 - 25 April 1914, p794 and p795}.

On 13 February the Presidente Municipal of Nacozari sent a $5 note (B 1003763) that had been taken from Sinforoso A. Navarro that he thought counterfeit, as the signatures seemed to be in the same hand and entirely different to other examples^{AGHES, Fondo Oficialidad Mayor, tomo 2993 L. Fragoso, Presidente Municipal Interino, Nacozari to Maytorena, Hermosillo 13 February 1914}. This was also referred to Nogales^{AGHES, Fondo Oficialidad Mayor, tomo 2993 Maytorena, Hermosillo to S. Aguirre, Tesorero General de la Federación, Nogales, 21 February 1914}, who replied that it was one of the many that had been extracted in transit and would be retained for incineration. He added that Carranza wanted all future cases to be referred to the corresponding authority for investigation^{AGHES, Fondo Oficialidad Mayor, tomo 2993 S. Aguirre, Ciudad Juárez, to Maytorena, Hermosillo, 7 March 1914}.

Contemporary reports of counterfeit Monclova notes

G. Gallegos, Tomas Fierro, José Vicente, Francisco Alonzo, E. Costillo, Francisco Fernandez and José Santana Gómez: On 16 February 1914 El Paso city detective Fred Delgado, assisted by chief of detectives Jesse C. Stansel and detectives O. W. Smith and George Herold, recovered two suitcases filled with $250,000 of alleged counterfeit Monclova money and arrested E. Castillas (sic), Francisco Fernandez, Tomas Fierro, G. Gallegos, Jose Viscondo (sic) and Francisco Alonzo. The detectives claimed that the money was counterfeit, as the signatures of Francisco Escudero and S. Aguirre were totally different^{El Paso Herald, 17 February 1914}. County attorney P. R. Price filed complaints in judge E. B. McClintock’s court against six defendants. Gallegos, Fierro, Vicente, Alonzo, Costillo and Fernandez were charged with swindling, and Vicente, Alonzo and Fernandez were charged with having forged instruments in their possession. The complainant, J. M. Chernin, a South El Paso Street merchant, alleged that he paid $380, Mexican money, for $460 worth of the alleged “phoney” rebel money.
José Santa (sic) Gómez was arrested by detectives on 18 February and is alleged to have had $400 of counterfeit (Monclova) money on his person^{El Paso Herald, 19 February 1914}.

All seven were charged by commissioner George B. Oliver, of the United States commissioner’s court, with having in their possession counterfeit money of a foreign country^{El Paso Herald, 19 February 1914}. One of the witnesses at the hearings was Luis Aguirre Benavides, private secretary to General Villa, who identified the genuine currency in the lot held as evidence against the prisoners. Alonzo, Fernandez and Visconte were released on 19 February under bond (Alonzo and Fernandez put up $250 for their freedom and Visconte $500). Gallegos was released on 20 February 1914 on a $1,000 bond^{El Paso Herald, 20 February 1914}. Visconte was discharged after a hearing before Oliver on 24 February as there was insufficient evidence presented against him^{El Paso Herald, 26 February 1914}.

Gallegos and Gómez might have continued their partnership as two counterfeiters with these names were shot in Mexico in December 1915.

M. F. Sanders: On 3 March 1914 the Presidente Municipal of Nacozari reported that the American M. F. Sanders, had been found to have seventeen $5 notes that were believed counterfeit, as the signatures were litographed. Sanders said that he had got the money from the Bank of Douglas. The matter was referred to the Tesorero General de la Federación^{AGHES, Fondo Oficialidad Mayor, tomo 2993 telegram L. Fragoso, Presidente Municipal Interino, Nacozari to Secretario, 3 March 1914: telegram Oficial Mayor, Hermosillo, to Presidente Municipal, Nacozari, 3 March 1914} and a fortnight later the Presidente Municipal was told to hand the matter over to the judicial authorities^{AGHES, Fondo Oficialidad Mayor, tomo 2993 telegram Oficial Mayor, Hermosillo, to Presidente Municipal, Nacozari, 16 March 1914}.

By 7 March it was reported that the Nacozari and El Tigre mining camps were being flooded with counterfeit Monclova notes. $4,000 had been issued in pay by the government agent who was operating the Cinco de Mayo mine, five miles north of El Tigre, on behalf of the state and confiscation of the notes began soon afterwards. A good amount of the issue was caught in El Tigre, while arrivals from Nacozari reported the appearance there of other amounts. The government issued circulars giving descriptions of the counterfeits. There were two classes in existence. The first was the money lost at the time the two trunks broke open. These notes, while genuine, had had the signatures forged, signed in blue and black ink, with a pen, whilst the genuine notes bore only the rubber stamp signatures. The other class was a lithographed duplicate of the original: this was detected by the signatures also being lithographed on the notes. Other notes in the values of 5, 10, 20, 50 and 100 pesos had been counterfeited. The twenty pesos denomination was the most easily detected because of the fact that in the originals the word “veinte” at the top of the note was misspelled, reading “viente,” the counterfeiters having taken pains to correct the typographical error in the good notes. Those of the other denominations were detected by the size of the numeral, both written and Roman, in the corners of the script: the words and figures were smaller on the counterfeits than on the originals^{Tucson Daily Citizen, 8 March 1914}. In April Evarico Villareal, manager of the rebel forces operating the Cinco de Mayo mine was placed under arrest and held incommunicado, charged with the circulation of counterfeit money and with thefts of ore from the mine. It was alleged that on the last pay day at the mine Villareal had paid out counterfeit money, which he had obtained in Douglas in exchange for the legitimate money he had been given for payroll purposes^{Bisbee Daily Review, 10 April 1914}.

Bernardo S. Pelzer: On 31 March Pelzer, an American with mining and money brokerage interests, was arrested in Cananea on charge of handling counterfeit money. He was said to have $167 in bogus currency in his possession^{Bisbee Daily Review, 3 April 1914: Tucson Daily Citizen, 4 April 1914}. Later the hiding place in which the bulk of his money was cached was discovered and several thousand pesos in counterfeit confiscated. Pelzer was alleged to have secured several thousand pesos in counterfeit money in El Paso and put it into circulation in Cananea through his office, in his capacity of banker and money changer^{Tucson Daily Citizen, 11 April 1914}. This was the second time for Pelzer, as the Los Angeles Times reported on 3 April that he had recently suffered the seizure of several hundred^{variant: several thousand (Tucson Daily Citizen, 11 April 1914)} pesos’ worth of alleged counterfeit money, had gone to Hermosillo and interviewed Carranza who restored the sum confiscated with an apology ^{Los Angeles Times, 3 April 1914)}. This time he was held for 46 days, 26 in the Cananea jail and the rest under house arrest, and sentenced to eight years in prison, before being released after a personal appeal to Carranza. The Supreme State Court at Hermosillo dismissed his case, declaring it to be groundless because the alleged counterfeit money in his possession when arrested had in reality no standing whatsoever as money and therefore represented no basis for a counterfeiting charge^{Bisbee Daily Review, 14 May 1914. The Tucson Daily Citizen had reported his release earlier. On 17 April he was reported as being in El Paso. The condition of his release was said to be that he would never return to Mexico (Tucson Daily Citizen, 17 April 1914). However, in September 1916 Pelzer was working as a banker and broker at the International Commerce Exchange, 2o callejon de 5 Mayo, Mexico City and writing to general Pablo González, proposing to supply outfits to his troops (APGG, leg. 8, exp. 52 letter 3 September 1916)}.

As a result of the Pelzer case there was an extraordinary rant against Jews. On 3 April Cesáreo G. Soriano, the recently-appointed collector of customs at Agua Prieta, issued a printed circular^{[text needed]} calling on Mexicans and others to refuse to trade with Jewish houses because they were responsible for the circulation of counterfeit money in Sonora. The circular was spread about the city and sent for general distribution to other localities. Needless to say, it caused a storm of indignation among Jewish residents and, to a considerable extent, the general business public. The charge was held to be wholly unfounded: Jewish businesses admitted that they may have unknowingly assisted the circulation of spurious currency, but not intentionally. At a meeting, Jewish citizens decided to prepare papers against Soriano for libel and damages and to have these served upon his first appearance on the American side of the border^{Bisbee Daily Review, 4 April 1914}. In retaliation, Abe Milowsky, a Jewish resident of Agua Prieta, was arrested and charged with passing counterfeit currency, an event seen as the start of a persecution of Jews^{Bisbee Daily Review, 10 April 1914}.

It is presumed that Pelzer was dealing in Monclova currency because of Carranza's interest.

In his April 1914 newspaper report the money broker J. Curtis remarked that “[T]he establishment of a market and purchasing value, for both the Villa and Monclova money, created the usual result which has been the history of all Latin-American countries where paper currency has been issued by de facto governments. American crooks and counterfeiters immediately proceeded to issue the Villa and Monclova money, with the same ease and efficiency with which the constitutionalist government printed it. Constitutional authorities made the mistake of having their Monclova money printed hurriedly, and the workmanship and quality of paper used was easily duplicated, while the Villa money was printed at the government printing shop in Chihuahua, and was even more easily duplicated than the Monclova fiat currency.” During the past sixty days border towns from Brownsville, Texas, to the California coast, had been flooded with about two and one-half million dollars of the Monclova and Villa counterfeit money.
“It has practically impossible for the average money dealer or broker to determine the difference between the real and counterfeit issues,” It was estimated that there were in existence eleven different counterfeit specimens of Monclova money ^{Albuquerque Journal, 4 April 1914}.

P. A. Hibbey: In July 1914 a P. A. Hibbey (or B. A. Hibbey) was accused in Nogales of circulating counterfeit Constitutionalist notes but was cleared because he had not known that the notes were bogus^{Períodico Oficial, 28 July 1914}.

In late October 1914 a Mexico City newspaper reported on a counterfeit $50 note. A señor López, the owner of a cigarette shop (tabaquería) in 1a calle de Bolívar received the note but when he tried to spend it, he was refused. He took it to the Secretaría de Hacienda, who confirmed it was counterfeit and wrote ‘Falsificado’ on it. The counterfeiters has taken care not to ignore the finest detail, though the characteristics were that the genuine note was on plainer paper (papel mas corriente), and had poorer printing and signatures. The reporter from the Correo Español made enquiries in various establishments in San Juan and around the Avenida de la Independencia and found similar notes of five and ten pesos, and a single $100 note as perfect as López’ $50 note. Two special agents and a detective were put on the case and discovered that a lot of businesses had similar counterfeits^{Correo Español, 28 October, 29 October 1914}. Another newspaper reported that the owner of the cigarette store was called Celedonio Martínez. Martínez said that an Eduardo Castro had received the $50 note in question (Series E 1353962) from the cashier at the branch of the Nacional Monte de Piedad, on the corner of calle Victoria and calle Ancha, with five other $50 notes. Castro gave the note to his friend Leopoldo Padilla, who spent it on lottery tickets in the Lotería Nacional. Martínez got the note from the Lotería but an employee had noticed a difference in the signatures and suggested he take it to the Secretaría de Hacienda. The only difference was in the signatures which were smaller^{El Pueblo, 29 October 1914}.

At the same time the Secretaría de Hacienda announced that counterfeit $5, $50 and $100 Monclova notes were in circulation. The counterfeit was detected by the fact that on the good notes Escudero's signature was in blue ink while the bad ones bearing the false signature were signed with black ink and the letters were smaller than in the real signature^{The Mexican Herald, 29 October 1914}.

A notice, in November 1914, reported counterfeits of all denominations, with the following general differences^{Periódico Oficial, Guanajuato, 10 December 1914; AMP, Tesorería, Tesorería, Correspondencia, caja 168, exp 3}.

When Luis Sotomayor handed over responsibility for the Tesorería General to Jesús Ramos in December 1914 he handed over two sealed strongboxes, one of which contained counterfeit Constitutionalist notes that had been collected from M. James of M. James & Cia, Sucs. in Nogales. The box contained the following:

Sotomayor had also extracted some notes to make up five sets of four denominations each and sent them to Agustin Berau (sic - certainly Agustin Beraud, manager of Las Fabricas de Francia of H. James y Cia., Sucs. in Hermosillo), M. A. Santaella, Felipe Pablovich, Gaspar Zaragoza, and W. Iberri so they could check the paper currency that they took in in their establishments^{AGHES, Fondo Oficialidad Mayor, tomo 2991, handover folder, 15 – 22 December 1914}.

On 3 January 1915 General Pablo González wrote to General A. I. Villarreal from his headquarters in Tampico that because of the large number of false $10 and $20 Monclova notes in circulation he should ban their circulation in Nuevo León and Coahuila. He had already issued a decree^{[text needed]} prohibiting them in Tamaulipas the day before^{AGN, Colección Pablo González, caja II, exp. 5. His instructions were acknowledged by F. Rubalcaba, the Administrator de Correos in Tampico, on 4 January and J. B. Escamilla, Inspector Telegrafos Nacionales in Nuevo Laredo, and General A. Ricaut, Jefe de las Armas in Laredo, on 5 January (AGN, Colección Pablo González, caja II, exp. 6)}. On 5 January González sent a circular^{[text needed]} to the administradores generales in Monterrey, Saltillo and Ciudad Victoria that they should tell their offices not to accept $10 and $20 Monclova notes ^{AGN, Colección Pablo González, caja II, exp. 5}. He also wrote to the Jefe de Armas in Piedras Negras that as these notes had been produced in the United States, the Jefe should be extra vigilant and forbid their circulation^{AGN, Colección Pablo González, caja II, exp. 5, telegram 4 January 1915. The circular was copied to Hidalgo, Camargo, Villa Acuña, Nuevo Laredo, Reynoso, San Ignacio and Matamoros in Tamaulipas. Hilario Téllez, 1o. Jefe de las Armas in San Ignacio acknowledged on 5 January}. The same message was sent to the customs administrator at Matamoros^{AGN, Colección Pablo González, caja II, exp. 5}.

On 6 January González wrote to Colonel Procopio Elizondo, Jefe de las Armas in Matamoros, in response to his query, that Monclova notes were absolutely prohibited^{AGN, Colección Pablo González, caja II, exp. 7: El Unionista (Matamoros), Época Primera, Núm. 178, 8 January 1915}.

It is unfortunate that later notices distinguished between two types of signatures but believed that the poorer notes with the stamped signatures were the counterfeits. Though one can prefer the better produced note, one can question the official's logic. As Mexican Paper Money argues, it would more logical to assume an improvement over time and, besides, evidence suggests that American-produced counterfeits of all revolutionary issues (as opposed to those knocked out in some poorly equipped Mexican establishment) were on the whole of superior quality to their originals.

Thus, on 4 January 1915 the Secretario de Hacienda, Luis Cabrera, wrote from Veracruz to the Customs Administrator at Tampico warning of a issue of counterfeit Monclova notes and asking him to inform the other offices. The characteristics were^{AGN, Colección Pablo González, caja I, expediente 19, fjs 3, 4}:

Another notice of February 1915^{El Demócrata, 15 February 1915; El Dictamen, 15 February 1915} lists similar differences:

Nicanor García Peña: García Peña was arrested by Captain Nicolás Villarreal in the "El Arco Iris" store on the corner of calle Benito Juárez and calle Independencia, with $11,600 in counterfeit Monclova notes. García Peña was working for a Tampico businessman, Francisco Villa, who had come to Mexico City to give the notes to a José Noriega, who would exchange them in the Tesorería General de la Nación. García Peña had tried to sell the notes to Captain Villarreal at a discount^{El Pueblo, 4 March 1915}.

Carascosa, Al Scharff: The Coin of Contraband^{Garland Roark, The Coin of Contraband, New York, 1964. Acknowledgement to the irreplaceable Clyde Hubbard, who alerted me to this book when, out of the blue, he invited me, a mere "ragpicker", to his home in Cuernavaca.} is the story of U. S. customs inspector Al Scharff. A consumptive, Al went south to save his life and got mixed up with a nymphomaniac. To flee her exhausting caresses, he rushed into Mexico and soon found himself mixed in with a band of rebels and participating in some bloody guerrilla raids. Feeling that life might be all too brief in this band, he fled north to Nogales, Arizona and became a cashier in Samuel Leeker’s store. While in Tucson in December 1914 he met a Mexican called Carascosa. In late January 1915 Carascosa visited him in Nogales and explained that he had been en route from Albuquerque to Hermosillo with two suitcases of counterfeit Mexican currency printed in Albuquerque. “It was printed from plates which one of my sons stole from some of the Villa people in the state of Chihuahua, and I had promised to deliver some two hundred thousand of these five-peso bills to a Hermosillo cattle buyer on Christmas Day. … The bills are worth about six Mexican pesos for one American dollar. …” Carascosa explained that the paper he used was the same as the Chihuahua legal bills, that it came from the same place, the American banknote people in Los Angeles, that he very carefully printed each bill by hand in Albuquerque, that when the authorities in Sonora and Chihuahua realized that someone was counterfeiting the bills, they had purchased a numbering machine, which of course had forced him to purchase the expensive equipment also. “There are several issues of bills in Mexico. This one is the Monclova issue. I have encountered no trouble whatever in disposing of these bills in Mexico, since they are identical to the money printed by Francisco Villa in Chihuahua.”

Carascosa agreed to sell Leeker ten thousand notes for two thousand U. S. dollars (four cents to the peso). Scharff was paid $2,000 U.S. commission and used it to buy another ten thousand notes, then set off for Hermosillo (winning a card game that included the cattle rancher Charlie Fowler en route). There he learnt that, because of the influx of counterfeit $5 Monclova notes since Christmas, each note to be legal tender had to be countersigned with the initials of the state treasurer, so he found someone to sign over 9,000 notes with the required initials. He sold some notes in Hermosillo and then left for Guaymas, where he was introduced to the Blocker brothers, Americans who were buying cattle for the British and Belgian governments. The Blockers bought five thousand notes for two thousand dollars (which Schaff converted into gold and sent to Wells Fargo in Nogales, Arizona) and left for the south. In Sinaloa they were arrested and after one had been shot the other confessed that they had bought the money from Scharff in Guaymas. On 21 April Scharff avoided arrest in Guaymas and tried to flee to Santa Rosalía in Baja California but was forced to turn back and a few days later was caught on the train north as it passed through Hermosillo. After eight days he was rescued from the penitentiary by Fredick Simpich, the American consul, and on 4 May arrived back in Nogales, Sonora, where he was duly arrested again but escaped across the border during the Cinco de Mayo celebrations. After these adventures he decided to put some distance behind him and from his $2,000 Wells Fargo savings bought a ticket for New York.

Though there are problems with this narrative one wishes it to be true. However, as on 24 April, a Nogales newspaper reported that “Al. Scharff and W. B. Allen, report having had a fine time fishing in the Guaymas bay. They returned home Wednesday evening, bringing with them a number of big fish. Last week Charley Fowler chaperoned a party of friends to Guaymas, on a fishing excursion. Everybody had a fine time, as they always do when Charley leads the procession.”^{The Border Vidette, 24 April 1915} one has to conclude that it has been embellished^{Scharff’s future career was similarly colourful. He went into partnership on a gold mine. Operating it was expensive and when, during World War I, the Bureau of Investigations hired him to go down into Mexico and blow up a German wireless station he went. Following his success at killing the spies and dynamiting their radio tower, he was approached by a customs official who told him that it was known that he had been running Mexican cattle into the States sub rosa and that if he wanted to be allowed to stay around and run his gold mine, he would also have to put his criminal talents to work for the customs bureau. He was sworn in and the rest was booze, wild women, smugglers, narcotics, and rebels.}.

As for the notes
(1) were they $5 Monclova, or dos caritas (or even sábanas)?
(2) what initialing (by state treasurer Jesús Ramos) is referred to?
(3) what is the full truth behind purloining the plates, sourcing banknote paper in Los Angeles and printing in Albuquerque?

Also,
(1) did Simpich report on rescuing Scharff?
(2) was an American called Blocker actually executed in Sinaloa for counterfeiting? One might presume that the U. S. authorities would have something to say about the matter.

On 15 June 1915 Luis Pruneda, the Inspector at the government printing works, reported that they knew of one type of counterfeit $5, two types of counterfeit $10, two types of counterfeit $20 and one type of counterfeit $50 Monclova notes^{CEHM, Fondo XX1, carpeta 43, legajo 4641}.

Frank Burke, Max Well: In September 1915 Frank Burke and Max Well were arrested by American authorities and $550,000 in counterfeit Monclova notes confiscated. Ramón P. de Negri, the Mexican Consul General, described the notes as wonderful counterfeits and claimed to have news that six million pesos had been printed, some of which had been introduced to Sinaloa (by Benjamin Johnson of the United Sugar Companies), others to Veracruz and Mexico City through Havana. This had led to the apprehension of the American citizen Kart E. Sheldon in Culiacán in possession of $240,000 in counterfeit notes^{[      ], file 6166 letter de Negri to the director general of consulates, Rafael E. Múzquiz, 14 October 1915. Elswhere, Burke is reported as a Secret Service agent}.