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At a Rose Parade festival about five years ago, counterfeiters struck Pete Mogannam's deli while passing phony bills at more than a dozen stores in downtown Santa Rosa.

Mogannam's Fourth Street Market and Deli got stuck with a fake $100 bill. He later heard that 13 other merchants also had accepted the funny Benjamins.

"They always manage to get you when you're going 100 miles per hour," Mogannam said of the counterfeiters' method of coming at the busiest times of the day.

U.S. currency has become increasingly difficult to duplicate, with ultraviolet "security threads" and a color-shifting ink technology that was developed in Santa Rosa more than a quarter century ago.

But counterfeiters have also stepped up the sophistication of their craft. In one week in mid-October, the U.S. Secret Service office in San Francisco reported collecting $46,000 in fake currency.

"That's a low week," Special Agent Chip Roberts told a group of merchants last week in Sonoma. The weekly count is typically between $50,000 and $100,000, accumulated in the Bay Area and coastal region from Monterey to the Oregon border.

That may sound like a small hit on the economy, Roberts said. But it involves a large number of fake bills passed and plenty of businesses that suffered losses.

The Secret Service made a presentation Thursday to Bank of the West commercial clients in Sonoma. Stacey Scudder, the bank's Sonoma branch manager, said she wanted her merchants to learn ways to quickly and easily identify authentic currency.

With the coming holiday season, both law enforcement and banks are urging merchants to increase their vigilance for bad bills.

"There's more people out. There's more money changing hands," said Charles White, assistant special agent in charge of the Secret Service office in San Francisco.

Michael J. Leonard, vice president for risk management at Santa Rosa's Exchange Bank, said during the holidays more people are standing in line and more merchants are hurried to do transactions.

"All that is in favor of the crook," Leonard said.

Estimates on the amount of counterfeit bills in circulation vary from $70 million to $250 million, according to a 2006 report from the Department of the Treasury.

Roberts told the Sonoma merchants that in one six-month period in 2006, the Secret Service took in $63 million in counterfeit currency.

It isn't just merchants who are targeted. A current trend is for counterfeiters to use their phony money to buy items on Craigslist, Roberts said. The sellers typically don't know they've been duped until they use the money at a store. The clerks suspect the bills are fake and police are called in to ask why the sellers are passing bad currency.

At the Secret Service presentation, Parson's Lumber and Hardware owner Alan Medina told Roberts that merchants want to help their staffs watch out for counterfeit currency. "What are the best guidelines we can give them?" he asked.

Roberts named four things to look for in denominations of $5 and above:

-- Watermark. In the right-hand side, you can see a second faint image of the person shown on the bill (for example, Andrew Jackson on the $20 bill). The older $5 bills have Abraham Lincoln, while the new ones have a "5" as the watermark.

-- Paper. The cotton and linen bills should have small red and blue fibers randomly embedded in the paper.

Shelters for Pawnee fire evacuees

Lower Lake High School, 9430 Lake St., Lower Lake, is the official shelter established for people evacuating from the Pawnee fire. It is equipped to handle animals.

The Clearlake Oaks Moose Lodge, 15900 E. Highway 20, Clearlake Oaks, is not authorized by the Office of Emergency Services but is also sheltering fire evacuees, mostly people in campers and RVs who want their animals with them.

There is an authorized Lake County animal services station in an open field at Highway 53 and Anderson Ridge Road in Lower Lake.

-- Security Thread. A visible, clear polyester thread is embedded vertically in the bill and inscribed with the note's denomination. Each denomination has a unique position and will glow with a unique color in ultraviolet light (green for a $20 bill, yellow for a $100 note).

-- Color-shifting Ink. When tilting a $20 note, the color shifts from green to yellow on number "20" in the bottom right-hand corner. The $5 note lacks this feature.

The agents added that when in doubt, clerks should take the suspect bill and compare it with one they know is genuine.

"Ninety-nine percent of the time that will take care of it," said White.

The pigment for the color-shifting special ink was developed in the 1980s in Santa Rosa by Optical Coating Laboratory subsidiary Flex Products, now a part of JDSU.

The ink, produced by a Swiss manufacturer, was first placed on Thailand's currency about 1987 and on U.S. bills in 1996. It is now used by more than 100 countries.

"This feature has withstood the test of time," said Adam Scheer, a vice president for JDSU's optical security and performance products. "It consistently represents a very high bar against counterfeiting."

JDSU since has developed "next generation pigments" that can give the effect of motion and depth, Scheer said. The company also offers a color-shifting foil-like thread that can be woven into currency paper.

Countries typically want multiple currency features that can't be easily duplicated, Scheer said.

"There's a value to redundance to make the document that much more secure," he said.

When merchants unknowingly try to deposit counterfeit bills, the bank staff must tell them they've been duped and confiscate the evidence. Banks are required by law to send the bogus bills in to federal authorities.

"We would have to keep that, whether it's business or personal," said Judy Reynolds, branch manager for Summit State Bank on Bicentennial Avenue.

In such cases, the merchants bear the loss, not the bank.

Many businesses use special pens to test the genuineness of the currency's paper. The ink is supposed to look yellow if the bill is real, but turn dark brown/black if it isn't.

But both the Secret Service agents and the Exchange Bank's Leonard said counterfeiters have found ways to defeat the pens, including spraying starch or hairspray on the fake bills. They even bleach real $1 and $5 bills and use them to print counterfeit $100 bills.

Leonard showed such a counterfeit $100 note. It feels like the authentic paper because it originally was a $5 bill. As such, it passes the pen test.

"But when you hold it up, it's got Abraham Lincoln's watermark on it," Leonard said. "It's the wrong guy."

For Leonard, the two easy ways to check a bill are to examine the watermark and pass it under an ultraviolet light to check for the correct color on the security thread. The UV light also can be used to authenticate credit cards, drivers licenses and passports.

"Everybody's putting ultraviolet tags on things," he said.

Those interviewed agreed merchants use the UV lights far less often than the anti-counterfeit pens. Even so, Bank of the West gave its merchants tiny flashlight-sized UV lights last week.

Mogannam, the downtown deli owner, said he wanted to learn more about the UV lights. So did Keven Brown, an owner of Corrick's Stationery Store, one of the places the counterfeiters targeted during the Rose Parade episode.

Brown, an Exchange Bank customer, said if Leonard was recommending the UV lights, he wanted to test one for his staff.

"If they're good," Brown said, "we'll buy them for everyone."

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