Why Fractional Notes?
Imagine yourself a proprietor of a business in the early 1860's and a customer wants to pay for their purchases. What do you do when you don't have adequate change available? There is a shortage of coins at the bank due to the Civil War. People are hoarding the few coins that they have and others were sending them to Canada to sell for their scrap value which had risen to more than the coins were worth. These are the major reasons why you can't give proper change to your valued customers. What do you do? Do you print your own currency that is only good at your establishment? Do you accept script from another business that may not be good? This was a real problem back in the early 1860ís. People and businesses did not have adequate supply of coins to keep the economy running smoothly so they reverted to creating their own form of private currency. In 1862, the federal government stepped in by issuing postage currency and later fractional currency that was widely accepted by the populace.
Encased StampsPostage stamps were being used to make change by different proprietors. The problem with using the stamps was that they would easily become discolored, damaged and torn. If they got wet, they would stick together and become useless. Next, stamps were placed in postage envelopes with a specified amount on the outside of the envelope. These envelopes were then passed as a form of currency. Unfortunately, some people tried to deceive others by sealing lesser amounts or plain paper inside these postage envelopes. John Gault, an entrepreneur of the times, decided to make a profit from the shortage of coins that was occuring in the summer of 1862. He decided that there must be a better way of using postage stamps and felt that encased postage stamps would be the answer. He decided that a brass container the size of a regular coin with its front open to show the denomination could be used as coins. A stamp with its corners folded was placed within the brass frame and a thin sheet of mica was placed over the stamp. The tabs of the brass container were then folded to keep everything in place. John Gault hoped that advertising placed on the reverse would generate his profits. He sold the copper frames to the merchants for a 1-2 cent profit. Merchants warmed to his idea of putting their advertising on the reverse and 31 different vendors decided to advertise on these colorful tokens. The denomination of the stamps used were the 1, 3, 5, 10, 12, 24, 30 and 90 cents. His patent was issued on August 2, 1862. It was the same time that the use of postage stamps that were used as money was banned in January 1863 by the Federal Government. The idea of encased postage did not last much longer. With the advent of postage currency and fractional notes, the encased postage stamps no longer filled a need. They lasted for several years and most show extensive wear with dents and broken mica.
The first issue notes, better know as Postage Currency, was authorized in the summer of 1862 and signed into law by the President on July 17, 1862. It was called Postage Currency since these notes resembled stamps. They were issued in 5, 10, 25 and 50 cent denominations. All four denominations came in the following order: straight edge with no monogram, perforated with no monogram, perforated with the ABNCO monogram (American Bank Note Company), and straight edge with monogram. A problem occured with the perforated sheets. The notes came apart and were sometimes damaged during shipping. Because of this, the straight edge notes became the favorite and the production of the perforated notes was short lived. This accounts for the rarity of the perforated notes.
If you would like to see high quality images from my collection of first issue notes, please click on the following link. FIRST ISSUE NOTES
A year later, July 11, 1863, the Treasury Department began printing its own notes. George Washington was chosen for the portrait of the note to show patriotism during the war with a dock scene for the background which was engraved by James Duthie. The front of all four denominations, 5, 10, 25, and 50 cent, all have the same portrait and had a bronze oval centered around Washington's image. These notes were also known as the porthole notes. On the reverse, each denomination had its own color scheme where the 5C notes were brown, the 10C notes were light to dark green, the 25C notes were light to dark purple and the 50C notes were light to dark red. Some of the notes on the reverse had surcharges added to them.
Eleven different papers were used in the attempt to stop counterfeiting. The fiber paper notes were printed on membrane paper with the obverse and reverse on separate sheets. These sheets were then glued together with fibers being added between the layers. The problem with the fiber notes was the separation of the front and reverse papers. These fiber notes tended to fall apart. The fiber notes are more scarse than the single paper notes. Again, the counterfeiters were able to duplicate the paper and the 25 and 50 cent notes were highly counterfeited.FR1248
The key notes to have for a complete second issue are the FR1248 and the FR1286a. The FR1248 has the surcharges of O, 63 at the top of the reverse. It is thought that these notes were doctored and had these surcharges added to the reverse at a later time. This couldn't be proved so this variety was still given its own FR number. Please note the special slant or angle of the numbers which is distinctive for this variety. Many times, some people try to pass off a different note, FR1245, where its surcharges are shifted higher so be careful when purchasing a FR1248. The other key note to the second issue is the FR1286a. The reverse of this note is shown to the right. The reverse of the note is slate gray instead of its normal light to dark purple. There are only about thirty of these notes still in existence. The following are very hard to find in higher grades and they are the FR1235, FR1249, FR1289 and the FR1321. If you would like to see high quality images from my collection of second issue notes, please click on the following link. SECOND ISSUE NOTES
The production of the third issue notes started in December 5, 1864 and lasted until August 16, 1869. The quality of the engraving of these notes was vastly improved over the first two issues but so was the quality of the counterfeit notes. The backs of the notes were either green or red in color. Some of the notes had printed signatures on the face of the note while others were hand signed autographs. Some notes were printed on plain paper while others were printed on an improved fiber paper. Surcharges were added on some of the Justice and Spinner notes and all had sheet indicators placed on the obverse except for the 3C denomination. Because of these additional printing measures, there were over 78 different varieties of notes in the third issue with denominations of 3, 5, 10, 25, and 50 cents.
This was the first and only time that the Treasury issued a three cent note and there are two varieties of this note. It was printed with a light or dark background behind Washington. There is a subvariety to this note and there are "no pearls" beneath the portrait.
The five cent note has four different varieties due to the two different colors of the reverse (red and green) and some notes had a sheet indicator letter 'a' on the left side. Sheet indicators were placed only on the extreme left column of notes on each sheet. The five cent note has the portrait of Spencer Clark on the obverse of the note. He was the Secretary of the Treasury and had his portrait placed on the note. This was a very controversial act and it didn't set well with Congress. Because of this, the US Congress enacted the law that no living person may be depicted on any form of US currency. This law is still in effect, so Mr. Clark had a great effect on the form of US currency.
The ten cent notes also have the sheet indicator letter on them and they also come with red or green reverses. These notes were also the first to have printed and hand signed signatures on them. This gives us seven different varieties for this denomination. It is the FR1255a note that is one of the key notes to having a complete collection. It is a hand signed note by Colby and Spinner. There are only three known examples of this note. In the recent O'Mara auction, an example of this note sold for $138,000. This is the only series of notes that do not have the word cents on them. Some people tried to pass them off a ten dollar note.
If you would like to see high quality images from my collection of third issue notes, please click on the following link. THREE, FIVE AND TEN CENT Third ISSUE NOTES
The portrait of William Fessenden was used on the 25C note in the third issue. He was still alive at the time and an exception was made to the recently enacted law that forbade using an image of a living person on any type of currency. Two colors were used on the reverse with the red back being the first printed and then green used on fiber paper. The fiber paper that was used was very fragile, and these notes had chipped corners and broke when folded. Some of these fiber notes had the rare solid bronzing on the obverse of the note and this can be seen in the FR1300 note to the left. The printing was quickly changed to plain paper due to the difficulity of the fiber paper. This is the reason the fiber greenback notes are so rare. Position indicator 'a' was again used on the Fessenden notes. The 'a' is found on the left side of Colby's signature. One printing plate had a different position for the 'a'. It is 7mm to the right, twice as large and found beneath Colby's signature. You can see this in the note to the right. Even though the solid bronze Fessenden notes are extremely rare, the key note to the Fessenden series is the 7mm 'a', FR1296. There are only about twelve notes in existence. The note pictured to the right came from the Ford/Boyd collection and was purchased at the Stack's auction in 2004. There are nine different varieties of the Fessenden note.
If you would like to see high quality images from my collection of Fessenden notes, please click on the following link. FESSENDEN NOTES
Justice and Spinner notes of the Third Series
Position indicator number '1' and letter 'a' were used on both the Justice and Spinner notes. In a sheet layout, the letter 'a' was used in the extreme left column of notes and the number '1' was placed in the top horizonal row of notes. There is only one note on each sheet that had a combination of both positional indicators of '1 and a' and it is found in the top left note. A complete sheet consists of twelve notes.
The Justice note was the first of the fifty cent notes to be printed. These notes were issued starting on December 5th, 1864 and used the vignette of Lady Justice on the obverse. The first note was the FR1357 and it may have been an experimental printing since only 3060 of these notes were printed. It was printed on fiber paper and has hand signed signatures of Colby/Spinner. The 'S-2-6-4' surcharges were used on its red back. It is thought that the very rare series, FR1351-54 may have come from this same printing since these notes were printed on the same fiber paper but lacked the hand signed autographs. The only other note to be printed on the same fiber paper that also used the same surcharges was the greenback FR1373a. It is believed that only one sheet was printed since there are only nine notes identified. It is interesting that no positional indicators were used on this sheet. The rest of the redbacks were printed for the Justice series which was followed by the green reverse notes. The population of the FR1351-54 is as follows. There are ten known FR1351, three known FR1352, eight FR1353 and seven known FR1354 notes.
The portrait of Spinner was also used on the fifty cent note. Again, an exception was made to the newly enacted law, Act of April 7, 1866, that forbade the use of an image of a living person on currency. The Spinner notes were printed from Jan. 1, 1866 through March 23 1869. The red backs were printed first. The first to be printed was the FR1328 with the hand signed Colby/Spinner autographs and then the Allison/Spinner signature notes. The Allison/New note, FR1330, was the third note in the Spinner series and most of these notes were thought to be presentation notes with most of them being graded uncirculated or better. The FR1330 that is pictured to the left came from the Ford/Boyd collection. A redesigned green reverse was done for the Spinner notes and these are known as type II reverse. These notes were printed between May 27, 1868 and April 15, 1869. These were the last notes of the third issue to be printed.
If you would like to see high quality images from my collection of Justice notes, please click on the following link. JUSTICE NOTES Not pictured are the FR1352-54 and the FR1373a which are not part of my collection.
If you would like to see high quality images from my collection of Spinner notes, please click on the following link. SPINNER NOTES
Fourth and Fifth Issue Notes
Many improvements were made to the fractional notes of the fourth and fifth issues to try to thwart counterfeiters. The first use of a Treasury Seal was done on the obverse of the notes to make it harder for the notes to be counterfeited. All of the notes now have printed signatures for added security. Three different papers were used for the fourth and fifth issues. A watermarked paper with pink fibers and unwatermarked paper with darker pink fibers were used. A sheet of watermarked paper had two rows of 'USUSUS' on it. The third type of paper produced the 'blue end' notes which used blue staining and blue fibers on the right side of the obverse of the note.
Fourth Issue Notes
The beautiful detail of the portraits and the printed signatures of Allison/Spinner adorned the notes of the fourth issue. This series was released between July 14, 1869 through Feb. 16, 1875 and consisted of 10C, 15C, 25C, and 50C denominations. The ten cent note is the most common in the series with four seperate varieties. The FR1257 is the watermarked variety with light pink fibers. The FR1258 is the unwatermarked variety with light to dark pink fibers. Both of these notes had the large (40mm) seal on the front. The other two varieties used the 'BLUE END' paper and two different sizes of the red seal were used. The large seal is 40 mm in diameter while the small seal is 2 mm less. These were the first notes to used the red Treasury Seals. The watermark variety was the first to be issued in 1869 and then the paper was changed to the unwatermarked type. Late in 1871, the paper changed again to the blue end note that has an abundance of blue fibers on the right side of the note. This paper was produced by the Wilcox Paper Company.
This series has the only circulated fifteen cent notes. The Grant/Spinner 15C notes of the third issue are only specimens and were never released for circulation. Some Grant/Spinner notes can be found with both front and reverse on them but they are two specimens that are glued together. The 15C notes of the fourth issue use a beautiful bust of Columbia and this can be seen to the right. There are four different varieties and they are similar to the 10C notes where they used watermarked, unwatermarked, blue end large red seal and blue end small red seal. The FR1268 is the unwatermarked variety and is very rare and extremely difficult to locate. The note pictured to the left is a FR1268 that came from the O'Mara auction in May, 2005. Most FR1268 notes are misattributed and are really FR1267 notes. The watemark can usually be seen hidden in the design of the note. The true FR1268 seems to have thicker paper and more pronounced fibers than the FR1267. The two other varieties of the 15C note have the blue end with large or small red seals.
There are three different fifty cent varieties with portraits of Lincoln, Stanton and Dexter. All of these notes have been counterfeited but there are no known counterfeit examples of the 10C, 15C, and 25C varieties. The Lincoln note was produced first and was issued from July, 1869 through December, 1869. This issue was short lived because a large quantity of good counterfeit were also produced. The Lincoln note was replaced with Stanton's portrait and these notes were issued from January, 1870 through September, 1873. Counterfeiters again duplicated these notes at a fast pace so that the Treasury Department changed the note to the Dexter variety. These notes were issued from Aug. 3, 1873 through Feb. 16, 1874. There are counterfeits of all fifty cent varieties in this issue. The note to the right is spurious and the note to the left is genuine.
If you would like to see high quality images from my collection of fourth issue notes, please click on the following link. FOURTH ISSUE NOTES
Fifth Issue Notes
The fifth and last issue consists of ten, twenty-five and fifty cent varieties. These notes were issued from Feb. 26, 1874 through Feb 15, 1876. All these notes used the blue end paper. The ten cent note used William Meredith's portrait and there are three varieties of this note. The green seal note was issued first and is rarer than the other two varieties which have a red seal. The two red seal notes are distinguished by the the length of the key used in the seal. The short stubby key is 4 mm long and the thin long key is 5 mm in length. The twenty-five cent note used Robert Walker's image. There are two varieties, the short key and the long key variety. The last note in this series was the fifty cent note with the portrait of Crawford. This note was issued from July, 1875 through February 1876. The fifth issue notes were the first currency notes to be redeemable with silver coins. These notes were much harder to counterfeit and there is only one counterfeit variety that has been identified.
If you would like to see high quality images from my collection of fifth issue notes, please click on the following link. FIFTH ISSUE NOTES