All forms of U.S. currency, including bills and coins, are protected by federal law. While many are aware of the illegal act of printing counterfeit money, it is not the only way to devalue U.S. currency.

18 U.S. Code § 331 bans knowingly damaging or falsifying U.S. or foreign coins to deceive.

Under Title 18 U.S. Code 331, it is a federal offense to fraudulently alter, damage, or falsify coins in the United States. These laws are intended to preserve the integrity of coins and currency.

If you violate this federal law, you face serious penalties. It's crucial to hire experienced legal counsel to improve your chances of avoiding a conviction or securing a reduced sentence.

18 U.S.C. 331 says, "Whoever fraudulently alters, defaces, mutilates, impairs, diminishes, falsifies, scales, or lightens any of the coins coined at the mints of the United States or any foreign coins which are by law made current or are in actual use or circulation as money within the United States; or

Whoever fraudulently possesses, passes, utters, publishes, or sells, or attempts to pass, utter, publish, sell, or brings into the United States any such coin, knowing the same to be altered, defaced, mutilated, impaired, diminished, falsified, scaled, or lightened…."

Conviction under this law can result in a maximum of five years in federal prison, highlighting the serious legal consequences of coin alteration.

What Is the Law's Stance?

18 U.S.C. 331 criminalizes various acts related to mutilated or counterfeit coinage, which can generally be grouped into two categories: modifying coins and distributing altered coins.

18 U.S.C. 331 prohibits the act of "alter, deface, mutilate, impair, diminish, falsify, scale, or lighten" any U.S.-minted coin or any foreign coin used as currency in the U.S. Examples of such alterations include, but are not limited to:

• Mutilation happens when someone deliberately damages or defaces a coin, decreasing its worth. This can involve scratching, carving, bending, or breaking the coin.
• Diminution involves decreasing a coin's value by changing or removing some of its metal content. This can include actions such as clipping or shaving the edges, drilling a hole, or sanding the coin's surface.
• Falsification refers to the illegal production of counterfeit coins, which may involve using the wrong metal content or altered designs.

Distributing Modified Coins 

Besides changing coins, passing off modified coins as real currency is also illegal. This covers intentionally distributing altered coins as described, with the intent to deceive others.

Examples of this crime include selling or exchanging counterfeit coins for goods and services, passing off altered coinage as legal tender, and other related offenses. Under this part of the law, even possessing coins you know have been altered can be a prosecutable offense.

To secure a conviction under 18 U.S.C. 331, the prosecution must establish the following elements beyond a reasonable doubt:

• You changed, damaged, reduced, or otherwise tampered with minted coins; OR
• You possessed, transferred, or sold these coins as legitimate, or tried to do so; AND
• You engaged in one or both of the above actions with fraudulent intent.

EXAMPLE: Tom creates a marketing stunt by using a press to imprint his face and business name on hundreds of rolls of quarters. However, for fraud-related reasons, he can be charged under U.S.C. 331 for mutilating minted coins.

Is "Penny Pressing" Against the Law?

"Penny pressing" machines, often seen at tourist spots, let visitors insert a penny, flatten it, and imprint a design as a keepsake. Understanding the practices prohibited by 18 U.S.C. 331, people frequently question whether these machines are illegal.

Because fraudulent intent is essential for a violation of 18 U.S.C. 331, understanding this helps clarify when penny pressing may or may not be illegal.

What Are the Federal Laws That Are Related?

18 U.S. Code Chapter 17 Coins and Currency includes various federal statutes related to 18 U.S.C. 331, which addresses mutilation, diminution, and falsification of coins, such as the following:

• 18 U.S.C. 332 - Debasement of coins; alteration of official scales, or embezzlement of metals;
• 18 U.S.C. 333 - Mutilation of national bank obligations;
• 18 U.S.C. 334 - Issuance of Federal Reserve or national bank notes;
• 18 U.S.C. 335 - Circulation of obligations of expired corporations;
• 18 U.S.C. 336 - Issuance of circulating obligations of less than $1;
• 18 U.S.C. 337 - Coins as security for loans.

Penalties for Breaking 18 U.S.C. 331

A conviction for mutilating, diminishing, or falsifying coins can lead to serious penalties, including:

• Fines reaching up to $250,000;
• Imprisonment of up to five years, or
• Both fines and imprisonment are options.

What Are the Potential Defenses?

The defenses in coin-mutilation cases depend primarily on the specific circumstances. However, if you're charged under U.S.C. 331, a knowledgeable federal criminal defense attorney might employ one or more of the strategies outlined below.

We might argue that there was no fraudulent intent. This is a common defense strategy in such cases, as proving fraudulent intent is the primary and most difficult element for prosecutors to establish.

If your attorney can demonstrate that you had no intent to deceive, the charges might be dropped. We could also contend that there was no modification. In cases of minor defacing, your attorney might argue that any perceived alteration resulted from normal wear and tear or inherent flaws in the coins.

Maybe we can suggest there was a lack of knowledge or possession. Your attorney might also argue that you were unaware that the coins had been altered. Assuming your guilt is clear, we could potentially negotiate a favorable plea agreement with the federal prosecutor.

You can reach us for a case review via phone or through the contact form. Eisner Gorin LLP is based in Los Angeles, California.