The accused have been identified as Satyanarayan Panda, Tarakant Biswal, Salim, Sk Rizuan and Manoranjan Barik.
All the accused were arrested by Semulia police while carrying out investigation into deposit of fake notes in the Samiti.
According to reports, one Bishnu Nayak had earlier deposited Rs 1.50 lakh and out of which Rs 44,000 was found to be fake on April 10.
Later, cops had detained Nayak and he revealed the source from where he had got the money.
"We had formed special teams and raids were conducted at different places in the district. We have seized Rs 1.48 lakh fake notes in Rs 2,000 denomination and arrested five persons," said Balasore SDPO (Sadar), Pravash Chandra Pal.
Though it is suspected the accused are part of a major counterfeit currency racket, further investigation to ascertain the source of procurement of the fake notes is still on, Pal added.
Samiluddin, who hails from Balasore, was nabbed basing on an investigation and leads from two students, who were earlier caught circulating fake Rs 2,000 notes in the market on Wednesday.
The two students were detained by Rasagobindpur police they were trying to purchase clothes from a store in Baripada by handing the shopkeeper a Rs 2,000 note.
On suspecting the authenticity of the currency, the shopkeeper sought assistance of other shopkeepers. Later, both the students were detained by the locals after the Rs 2,000 note was found to be fake.
Senior police officials informed that 90 counterfeit currency of Rs 2,000 denomination have been recovered from Samiluddin and further investigation in connection with the incident is on.
Acting on a tip-off about smuggling from Bangladesh, the Border Security Force troopers of border outpost Churiantpur in Malda district planned an ambush in and around the Indo-Bangladesh Boundary Fence (IBBF) area on Tuesday evening.
"The BSF recovered a bundle of 260 fake Rs 2,000 notes from the border area and handed over the seized notes to Kaliachak police station for further action," RPS Jaswal, Deputy Inspector General of BSF's South Bengal frontier, said in a press release.
"The troopers challenged a suspected smuggler who was about to collect the package thrown from the Bangladesh side of the fence but the suspect fled away taking advantage of the darkness," he said.
The BSF of the South Bengal Frontier has seized counterfeit Indian currency notes of the face value of more than Rs 36 lakh and apprehended five smugglers so far during 2017.