(MONEY Magazine) – IN THE FIRST MAJOR PAPER CURRENCY REdesign since 1929, the Treasury Department created the new C-note pictured below, which could begin circulating as early as next month, to thwart counterfeiters. That's right: A flood of amazingly good fake $100 bills have emerged in recent years. And hundreds aren't the only knockoffs. Fully $208 million in pseudobills of all denominations were seized worldwide in 1994, and several billion dollars more are estimated to exist. If continued unchecked, the fakes could cause the dollar to weaken against other currencies, says Jordi Gali, an economics professor at New York University.

The new $100, which will be followed by redesigned $50, $20, $10, $5 and $1 bills over the next five years or so, incorporates features that the feds hope will be tough to copy. They include a larger, more detailed picture of Ben Franklin; special ink with a green-black sheen used for the numeral in the lower right corner; and a polyester thread embedded in the paper that you can see by holding the bill to the light.

But here's the hitch: The government won't be calling in the old bills. So cut your chances of getting slipped a fake by accepting only new ones. If you think you have a counterfeit, the Secret Service advises you to take it to the police or face possible fine or jail time. But don't expect reimbursement for a fake. As in the old kids' game of hot potato, the person holding it last suffers the loss.

--Karen Hube