POLICE have issued an urgent warning to traders and members of the public following reports of a large number of counterfeit banknotes being circulated in Dorking.
All of the reported incidents have so far involved £20 notes, 247,000 of which were seized by the Bank of England in 2011, at a valued at £4,940,000.
PC Michael Vaccaro, of the Mole Valley Safer Neighbourhood Team, said: "Officers are currently investigating a number of offences where counterfeit notes have been used in local shops and I would advise anyone who suspects they have been handed a fake note to contact Surrey Police with information."
Dorking trader Barry Johnson said his fruit and veg business had suffered recently due to the rise in counterfeit money.
He said: "Most people do not realise they are giving you a fake note, because they have been done by someone else already.
"It is so bad at the moment. Last week I must have had about £120 worth of fakes in my pocket, and for a small-time trader that is a lot of money to be losing out on."
A man in his 20s has been arrested in connection with an incident where a counterfeit note was used in Dorking on January 11. He has been released on police bail while inquiries continue.
Anyone with information on counterfeit money being used in the Mole Valley area is urged to call police on 101 or Crimestoppers anonymously on 0800 555 111.
For more information on how to spot counterfeit notes, visit the Bank of England website