That is just part of the story.....
.... again that is like stories of the $2 bill being refused as being a counterfiet. It's a screw up. The note they presented (if not fake) was redeemeable. If they went to jail as the story says, it was breifly until the note was verified. I am sure the BEP and/or Treasury websites will confirm that they are still redeemable legal tender. $5,000 and above I believe needs to be sent to the BEP for redemption, but a BANK can redeem it (then they send it in).
-I stand by my statement-