Police are warning retailers to be extra wary of counterfeit cash over the busy holiday period.

A number of counterfeit notes have been reported around New Zealand throughout the year.

To avoid falling victim to fake cash, retailers and the public are being asked to boost their knowledge around banknote security and report any bogus notes they come across.

There are two styles of legal banknotes currently in circulation, and any fakes easily fail the look-feel-tilt test, says Senior Police Document Examiner Jessica Owen.

“Our advice to cash handlers is to look at the other security features on the note. If the banknote has a bird at the lower left front, tilt the note back and forth."

A rolling bar of colour will move up and down the bird as the banknote is tilted.

"You can also hold it up to a light and see a fern in the centre of the bird.The older style of banknote has a small oval window at the front right."

Holding it up to a light will show a watermark of the Queen to the left of this oval window.

“Finally, if you have access to a UV torch or blacklight, both styles of genuine banknote have a patch showing the denomination that will glow, located on the front left of the note.”

There’s been a steady increase of counterfeit notes over the last couple of years, which is concerning. 

“This includes counterfeit notes we receive from the Reserve Bank that were detected in the national cash handling system.

"They account for around twice the volume of notes we see reported to Police,” says Jessica.

“We know that fake notes are a costly headache for retailers. Checking for the security features, together with the look-feel test, will help prevent these losses.”

Anyone who finds a counterfeit note should report it to Police as soon as possible.

Manufacturing counterfeit notes, or knowingly passing them on is a serious offence.

Possession of forged bank notes can be punishable by up to seven years in prison, or up to 10 for using one. 

The Reserve Bank has more information about counterfeit notes.