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Increasing EU citizen Security by utilizing innovAtive intelligent signal processing systems For Euro-coin validation and metal quality testing

Final Report Summary - SAFEMETAL (Increasing EU citizen Security by utilizing innovAtive intelligent signal processing systems For Euro-coin validation and metal quality testing)

Executive summary

Euro coinage has been steadily subject to increasing outlawed counterfeiting activities. The most recent figures bring to 17 the number of illegal mints discovered to date, accompanied with a significant cumulative total of counterfeit coins detected or confiscated. Around 140 classes of counterfeit coins and corresponding tooling and working methods are identified, which by European Technical and Scientific Centre directives lead undoubtedly to the conclusion that the vast majority of counterfeit manufacturing facilities remain in operation. At the same time, conductivity measurements are widely used for characterisation of heat treatment of aluminium alloys and other non-destructive testing, especially for safety-critical applications in aerospace industry, nuclear reactors, etc.

Prior art in the field has led to technologies made to reduce at manufacturing time the spread of electrical parameters, and at validation time the measurement of electrical conductivity of the metal respectively. Due to the large number of coins produced by European mints, material for coin blanks is sourced from different suppliers. Recent European directives to increase the security of the coinage by reducing the spread of parameter values result in significant challenges for manufacturers of coin validators used in vending machines and bank coin-sorting machines.

The participating small and medium enterprises (SMEs) have identified these challenges and consider them as major product opportunities. The developed metal-validation technology is required to distinguish between increasingly sophisticated counterfeit and the tightly specified genuine coins, and to characterise the metal quality. This is accomplished by developing advanced signal processing and data-fusion techniques, and by also developing planar electromagnetic sensors and pulse eddy-current measurement techniques with increased field sensitivity. The market being addressed includes coin validators and aerospace and nuclear industries.

Project context and objectives

The key scientific and technical objectives of the project are listed below.
1. Development of techniques for measurement of electrical conductivity of coinised copper-alloy specimens. Targeted uncertainty within +/- 1 % from DC to 1 MHz and +/- 4 % from DC to 10 MHz with measurements traceable to international standards.
2. Development of mathematical models and numerical techniques to define the interaction of broadband electromagnetic fields with objects of finite size, such as coins, and of bi-metallic/layered construction.
3. Detailed characterisation of the electromagnetic properties for euro coins of all denominations and selection of other coins.
4. Investigation of Eddy-current signal interaction with bi-metallic/layered construction of euro coins at a range of frequencies form DC to 10 MHz.
5. Investigation of the effect of surface finish, plating, tarnishing/oxidation and embossing patterns (for both the common and country-specific sides of a coin) on conductivity across the range frequencies.
6. Development of theory to model electro-magnetic planar sensors, enabling use as improved alternative to conventional coil sensors.
7. Development of the theory of pulse-based/broadband eddy-current conductivity measurements.
8. Development and application of novel signal-processing techniques to extract useful information from the complex electromagnetic signals using low-cost and low-power hardware.
9. Development and optimisation of sensors to measure other parameters of coins — diameter, thickness, weight, etc.
10. Development and application of novel data-fusion methodologies to combine information from the electromagnetic and other sensors.
11. Design, realisation and evaluation of validator prototypes based on the innovations applicable to vending, service automation and amusement machines. The requirement of these high-volume market sectors is for high-security and reliability coin validation combined with low cost.
12. Design, realisation and evaluation of validator prototype based on the innovations applicable to high-speed coin sorting and counting machines used by banks. In addition to high-speed operation (targeted at up to 3500 coins per minute), high discrimination between genuine, counterfeit and foreign coins is necessary with accurate, traceable calibration of the machines.
13. Design, realisation and evaluation of prototype-conductivity measurement and calibration system based on the innovations applicable to the needs of mints, coin-blank suppliers and banks.

Moreover, the project’s scientific and technical objectives resulted in significant advancement of the state of the art in several areas. Ten distinct innovations have been accomplished within the duration of the project.
1. New techniques for measurement of objects of high conductivity and small (coin-sized) dimensions to high and traceable accuracy covering the frequency range up to 10 MHz.
2.Validated theoretical and mathematical models for interaction of broadband electromagnetic signals with objects of finite size, such as coins, and of bi-metallic/ layered construction.
3. Availability of data characterising the electromagnetic properties of euro and other coins.
4. Planar sensors..
5. Pulsed/broadband eddy-current techniques.
6. Extraction of useful information and interpretation of complex signals using low-cost and low-power hardware.
7. Improved sensors to measure other parameters of coins – diameter, thickness, weight, etc.
8. Data-fusion algorithms.
9. Availability of improved coin-validator systems appropriate to a wide range of applications.
10. Availability of improved electrical-conductivity measurement instruments and associated calibration techniques.

Project Results

The project is highly relevant to the commercial participants, each of whom has clearly defined plans for commercialising the scienticific and techonological results, as well as the foreground generated within the project. A complete list of all the achieved project results is outlined below. Of these, results 9, 10 and 11 are prototypes of the products that will be further developed by the SMEs and brought into production.

Result 1: Techniques for measurement of electrical conductivity of coin-sized copper-alloy specimens. Targeted uncertainty within ±1% from DC to 1MHz and ±4% to 10MHz with measurements traceable to international standards.

Result 2

Theoretical and mathematical models for interaction of broadband electromagnetic signals with objects of finite size, such as coins, and of bi-metallic/ layered construction.

Result 3

Detailed characterisation of the electromagnetic properties for euro coins of all denominations and other coins.

1. Investigation of eddy-current signal interaction with bi-metallic, layered construction of euro coins at a range of frequencies from DC up to 10 MHz.

2. Investigation of the effect of surface finish, plating, tarnishing/oxidation and embossing patterns (for both the common and country-specific sides of a coin) on conductivity across the range of frequencies.

Result 4

Theory to model electro-magnetic planar sensors, enabling use as improved alternative to conventional coil sensors.

Result 5

Theoretical basis for pulse-based/broadband eddy-current conductivity measurements.

Result 6

Novel signal-processing techniques to extract useful information from the complex electromagnetic signals using low-cost and low-power hardware.

Result 7: New, improved sensors to measure other parameters of coins - diameter, thickness, weight, etc.

Result 8

Novel data-fusion methodologies to combine information from the electromagnetic and other sensors.

Result 9

Validator prototypes applicable to vending, service automation and amusement machines. The requirement of these high-volume market sectors are for high security and reliability coin validation combined with low cost.

Result 10

Validator prototype applicable to high-speed coin sorting and counting machines used by banks. In addition to high-speed operation (targeted at up to 3 500 coins per minute), high discrimination between genuine, counterfeit and foreign coins is necessary with accurate, traceable calibration of the machines.

Result 11

Prototype conductivity measurement and calibration system applicable to the needs of mints, coin-blank suppliers and banks.

Potential impact

The project makes an important contribution in support of implementation of recent European Commission Recommendations and in particular, Recommendation 2005/504/EC on the authentication of euro coins and handling of euro coins unfit for circulation.

The project results also have relevance to implementation of Council Regulation 2182/2004 on medals and tokens similar to euro coins. This regulation recognises that similarity of tokens with euro coins needs to be forbidden in terms of visual and machine-readable characteristics, the objective being to minimise euro-coin related fraud and confusion for the public. The measurement techniques and new instrumentation resulting from the project are assisting in checking conformity with this regulation in respect of the metal properties.

The project also provides a contribution in further ways to assist in protection of euro coinage. Introduction of improved measurement techniques will enable coin-blank suppliers and mints to reduce the variation in parameters of coins. Additionally, new security features such as characterisation of junction resistance between bi-metallic materials has been proposed. Introduction of additional security features in coin construction together with reduced variability in manufacturing tolerances and the associated proposed improvements in coin-validator technology makes it more difficult for counterfeiters to replicate and use fake coins.

Since introduction of the euro coinage in January 2002 there has been a steady increase in counterfeiting activities. A recent report states that two more illegal mints were dismantled and over 300 000 counterfeit coins (85 % of which being the highest denomination 2 euro) were seized or removed from circulation during 2007. This brings to 17 the total number of illegal mints discovered and a cumulative total of over 1 300 000 counterfeits detected.

The participants of the SAFEMETAL project have identified these challenges as also representing major opportunities. Improved coin validators are required to distinguish between increasingly sophisticated counterfeit and the more tightly specified genuine coins. A large market demand is expected for the improved validators, both for new machines and as retrofits for existing machines to upgrade their security.

Moving to the specific exploitation plan for each company. Ardoran plans to introduce a new range of improved coin validators targeted at the high-volume sectors of the market for validators used in a wide variety of vending and service automation machines. It has been agreed that Algosystems, the large Greek company, is authorised to produce and market validators under a licensing agreement with Ardoran (the SME partner owning this project result in full). Ardoran will concentrate on sales of the new validators in northern, central and eastern European countries, including the Russian Federation, whilst Algosystems will promote sales in Greece, southern Europe, the Middle East and African countries. As it has been reported, 344 620 vending machines for food and beverages were sold in Europe in 2005, with Italy representing the most important market. Ardoran will develop sales of the new validators as components to vending-machine builders, the largest number of whom are also located in Italy. Market development is facilitated by Algosystems, which has established sales agents in Italy and throughout southern Europe, whilst Estonia-based Ardoran is developing the corresponding opportunities in northern, central and eastern Europe. The project partners are additionally promoting sales of the new validators for use in service-automation applications, including car wash and laundry machines and for parking meters and pay-telephones. It is also intended to target the amusement/gaming machine sector which, based on a recent report, accounts for around 63 % of the overall payment systems market. In general, the total number of installed vending machines in Europe exceeds 4 million. This figure is provided by the European Vending Association and only includes food and beverage machines. Based on all the reported figures, it can be estimated that the total number of coin-operated machines of all types is in excess of 20 million.

Dunvegan Systems intends to apply the innovations to develop a high-performance/high-speed validator applicable to bank coin-sorting machines. The high-performance version of the validator developed in the project will be incorporated as a key sub-system for high-end/high-speed coin-sorting and counting machines widely used by banks and large retailers. There is a requirement to upgrade existing machines to detect new sophisticated variants of counterfeit coins that have appeared in circulation.

A market is assured since clients in the banking sector urgently require a solution to enable conformance with the EU Recommendation 2005/504/EC on the authentication of euro coins and handling of euro coins unfit for circulation. The first priority is to upgrade existing bank machines—it is feasible to implement the higher security validator as an upgrade module rather than involving a redesign of the overall machine. It is estimated that the further product development work can be completed within the next 10 months.

Design of the production version is expected to involve a continuation of the technical collaboration with Electronics Design started within the project. Assistance of Metrosert will additionally be required for calibration and certification of the upgraded machines. Existing contacts, together with those developed within the project, will facilitate evaluation and market introduction of the new coin sorting system.

EDIS, in cooperation with Ardoran, plans to exploit the project results by developing niche markets for conductivity measurement and calibration systems. For example calibration of traditional conductivity measurement instruments is often problematic and of questionable accuracy. There is wide variability in the windings of the multi-turn sensing coils, requiring each instrument to be individually calibrated against metallic reference standards. Such calibrations are only valid for the particular material of the reference standard at a particular temperature and operating frequency. For many applications, the accuracy of calibration is critical, an example being in the characterisation of heat treatment of aluminium alloys for aerospace applications. In annealed condition, type 2024 aluminium has a yield strength of 75 MPa. This can be increased to 455 MPa by heat treatment; i.e. by a factor of six. The associated change in electrical conductivity is from 50 to 38 % IACS; i.e. by a factor of less than one. Since heat-treated aluminium parts look exactly like un-heat-treated parts whilst the difference in strength is dramatic, the real possibility and associated consequences of putting an untreated or badly treated component into service can be readily appreciated.

Moreover, EDIS has recently provided a solution for testing of long-distance conveyor belts during operation. The developed solution operates reliably under extremely difficult operating conditions involving climatic changes, vibration and dust, but primarily electromagnetic interference. It is capable of distinguishing ferromagnetic objects on the belt of oscillating and rotating conveyor rollers subject to sidewall vibrations and in the presence of changing magnetic fields from electric power cables, transformers and the movement of excavator buckets.

The broadband pulse-based eddy-current conductivity measurement know-how resulting from the project is particularly applicable for measurement of thin metallic sheets and coatings or characteristics of surface layers. Signal processing of the multiple frequencies enable changing properties of the material with depth to be identified, or precise thickness measurement, even on a non-contact basis.

Examples of important applications include:

1. Quality control of heat-treated aluminium for aerospace and other critical industrial applications;
2. Thickness measurement of metallic film deposition (as, for example, for TV tube production).

Additional important identified applications that will be targeted include the following.
3. Copper thickness/quality control of printed circuit boards, including multi-layer.
4. Quality control of electroplating and other surface treatments/depositions.
5. Real-time measurement of thickness and surface quality of metal sheets and foils during production. Being a non-contact technology, measurements can be undertaken even in aggressive industrial environments or for hot metal during actual rolling and other processing operations.
6. Measuring the thickness of non-conductive paint and other coatings deposited on a conducting substrate. The use of multiple frequencies together with novel approaches to signal processing enables the effects of lift-off and target material properties to be distinguished. Consequently, noncontact-based solutions can be offered whilst allowing a variable sensor to target distance and non-optimal orientation of the sensor relative to the target (i.e. it does not need to be exactly perpendicular to the target).

Finally Algosystems has a dedicated certified metrology division which includes a coin blanks laboratory facility. Currently, in collaboration with Ipiros Metalworks Industry (MBH) S.A. a subsidiary of Hellenic Defence Systems S.A. (EBO PYRKAL), it can produce all coinage alloys and all types of coin blanks as well as rings for bi-colour coins, according to any specifications. Through the results of the SAFEMETAL project, Algosystems expects to further extend its collaboration with MBH and offer services of higher quality. The knowledge gained from the project will also assist the company to establish its position in service-provisioning areas like consulting and training services on metrology and verification issues, procurement of prototype metrology equipment and development of accurate measurement and calibrations processes. Last but not least, Algosystems sees an opportunity to use the project’s applications in bank machine validators to develop related products, since some of the major banks in Greece (Agricultural Bank of Greece and Alpha Bank) are included in the company’s clientele.

The academic partners have disseminated the results in their respective academic communities mainly through the website of the project and publications to the related conferences, workshops and journals.

Throughout the project the user-friendly SAFEMETAL website has been utilised so as to diffuse the SAFEMETAL objectives and results as widely as possible, throughout the community and to operate in parallel as a project repository. The project website is where all the public deliverables have been placed, as well as links to the partners’ website and the corresponding press releases and newsletters.

The academic partners have also published their results (under the authorisation of the SMEs in all cases) in numerous international journal and conferences as described in detail in Section 4.2 of this report.

Project website: http://www.safemetal.eu/