Haylie Byrne, 27, now of Alpugi Place, Kelso appeared in Bathurst Local Court on November 11, charged with possession of a knife in a public place and possession of counterfeit money.

Her solicitor Mr Gration told the court the fake money did not come "from a sophisticated set up" and his client carried the knife "for self defence".

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He said at the time of the offence his client was living in Glenroi in Orange and was subject to negative influences.

However, she had since removed herself from the group and moved to Kelso where she is living with her mother.

"She has removed herself from the drug world," Mr Gration said.

The court heard Byrne previously had an issue with crystal meth but was now studying a Certificate III in customer engagement which she will complete in 2020.

Police facts tendered to the court told how Byrne was pulled over by police as a passenger in a car seen slowing down in the vicinity of a known drug area.

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Officers saw Byrne was sitting on a clear plastic bag and when they shone their torch on the bag she crossed her legs to hide it.

Police searched the car and found 39 counterfeit $50 notes inside the bag, all with the same serial number. Byrne denied any involvement with the cash. Police also found a knife which Byrne said was for protection because "I live in Glenroi".

Officers questioned Byrne in relation to the money and she conceded her DNA and fingerprints would be on the notes. She said "they were more then likely from her old house" but would not comment on how the notes got into her car.

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In sentencing, Ms Follent noted Byrne's early guilty plea and that nothing in the police facts indicated the fake currency was part of a sophisticated operation.

But she said there was a strong nexus between the accused's use of drugs and offending behaviour and also noted counterfeit money could have significant economic impact on the community.

For possession of a knife in a public place, Byrne was convicted and placed on a Community Corrections Order for 12 months.

For the counterfeit money, she was convicted under Commonwealth recognisance.