More than 900 counterfeit 10,000 yen bills with finely crafted watermarks have been found in Tokyo, Osaka and Shizuoka prefectures since the beginning of 2002, and investigators suspect an overseas criminal organization.

Seven people have been arrested for allegedly using fake 10,000 yen bills -- five Taiwanese people in Osaka, a Chinese in Tokyo who entered Japan via Hong Kong and a Japanese gangster in Shizuoka.

"It's an international, organized crime committed by a group with funds of some extent," remarked a high-ranking officer in the National Police Agency.

"Generally, investigations into fake bill cases are difficult, but this time we have a better chance of unraveling it because several people have been arrested."

The bogus bills have dots instead of the lines found on the real thing. The officer said there are few dots, and the technology used is more than 10 years old in Japan.

"Old Japanese printing machines could have been moved overseas and used," the officer speculated.

Tomohiko Endo, president of the private Counterfeit Detection Research Center of Japan, based in Chiba Prefecture, said: "As far as printing technology is concerned, the fake bills are middle-grade, but the watermarks are quite clear. Since many Japanese tell the difference between real and fake bills by the watermark, the counterfeiters apparently knew that it was crucial."

Real 10,000 yen bills are printed on paper that is 0.1 mm thick. But the phony ones are printed on two pieces of paper 0.5 mm thick that are glued together.

Drivers at a Tokyo taxi company have been trying to verify watermarks at night with the light from their meters.

"It's difficult to tell the difference by dim light with such a large number of fake bills in circulation," said an official with the firm.

Endo added, "It's said that since the terrorist attacks on the United States, the number of travelers to the U.S. is decreasing, diminishing demand for fake dollar bills.

"With the cohosting of the World Cup soccer finals (by Japan and South Korea this year), travelers to Japan will certainly increase in number, and there are concerns that the yen will become a target."