doctored "puttied" gold coins

[PerryHall]

Putty seldom ruins a coin and acetone can usually be used to safely remove the putty.

[BillJones]

Putty seldom ruins a coin and acetone can usually be used to safely remove the putty.

 

That misses the point. Getting stuck with one of these doctored coins is something that many collectors can't spot until they go bad. After that you have a hassle. If the "snifter" can spot this, it would be coup for the company that uses it.

[GoldFinger1969]

Interesting -- it would make a good research article to explore what can be detected and how successful that detection has been in a commercial environment.

 

I would think that something like an MRI or spectroanalysis for coins would now be possible give the advanced imaging we now have and the computerization. It's LIGHT-YEARS ahead of when the grading companies first started out, or even 10-15 years ago.

 

Being able to run a coin through something that determined that your gold or silver coin was in fact the correct weight, size, molecular composition, and had no foreign substances would be great.

 

For the volume of coins the TPGs see, it would be a wise investment on their part.

[Nutmeg Coin]

I got notified that one of the $5 gold coins PCGS OH I sold last week is getting returned. The guy said it had AT, etc., so it probably would not CAC etc.. No big deal I don't want any unhappy customers.

 

So I will have a couple options: Send to PCGS under their guarantee. $25 or so and up to 60 days wait if they agree they restore it or whatever.

 

Option two, break it out and dip it in acetone and send in to NGC. There really isn't much of an upside on five Libs. unless you get a 63 or more.

 

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&rd=1&item=261415512655

 

 

[CSdot]

Nutmeg,

 

Just checking out your listings and I love this one: http://www.ebay.com/itm/FR-1187-20-GOLD-NOTE-PMG-AU58EPQ-/261424650534?pt=LH_DefaultDomain_0&hash=item3cde1f9926

 

I don't have much currency, but I picked up a 1922 $20 gold certificate graded 30 about 5 years ago and it is my favorite bill. Yours is really nice. One day I'd like to get a technicolor one.

[Nutmeg Coin]

If you can get those high grade, EPQ, etc. the color is impressive and nice to share.

[GoldFinger1969]

You know....between counterfeit coins, counterfeit slabs, puttying, scammers, mega-markups on ordinary coins, and 'slabification' with all the different grades involving new coins (like the 2009 UHR)....now I know why I left the hobby for 20 years.

 

Seriously, having the TPG off by 1-2 grades on a coin is NOTHING compared to fraud and deceit. The sooner it is arrested the better it will be for the entire hobby or what you will have is nothing but high-end coins being bought by high-end collectors who can spend a small fortune verifying that their expensive coins are legit and undoctored.

[Nutmeg Coin]

Wall Street is more corrupt than numismatics because they deal in lots more money. But still the learning curve is steep here.

[GoldFinger1969]

Wall Street is more corrupt than numismatics because they deal in lots more money. But still the learning curve is steep here.

 

Wall Street is very transparent, there is very little fraud, and you can buy-or-sell and get out very quickly for about $20-$30 round-trip. Not the case with most coins.

 

 

[Nutmeg Coin]

True, but the billionaires like Jamie Dimon and all the other major players make the numismatic king pins look like "The Little Rascals"....

 

Wall Street is a rogues gallery if you read Zero Hedge, etc.

 

http://www.businessinsider.com/who-didnt-pitch-into-buffetts-charity-list-2010-8#george-soros-19

[GoldFinger1969]

True, but the billionaires like Jamie Dimon and all the other major players make the numismatic king pins look like "The Little Rascals"....

Jamie Dimon is not a billionaire.

 

Wall Street is a rogues gallery if you read Zero Hedge, etc.

http://www.businessinsider.com/who-didnt-pitch-into-buffetts-charity-list-2010-8#george-soros-19

 

ZeroHedge is a hedge-fund source site. It has some good articles but it's an anti-Wall Street, anti-economy, very Austrian in their economic outlook.

 

I've been bearish on stocks and the economy but ZeroHedge is apocalyptic.

 

My point is this: I can buy a blue-chip stock at the wrong time, see it go down, and still make money over time from capital gains and dividends. There's no 'fraud' involved in buying Berkshire Hathaway or Coca-Cola or JP MorganChase or Viacom or even NetFlix or Celgene.

 

But if I buy a 1920's Saint for $10,000 and I find it's been put in a counterfeit slab or been doctored, that's fraud. I could have overpaid by 50% on Day 1 -- that's never the case with financial instruments.

 

If fraud persists in the coin and other hobby trades, I would not be surprised to see the Feds get involved. When enough people get burned, it'll be worth hogging some airtime on the cable TV networks.

[Nutmeg Coin]

So how do we define "fraud"?

 

fraud n. the intentional use of deceit, a trick or some dishonest means to deprive another of his/her/its money, property or a legal right. A party who has lost something due to fraud is entitled to file a lawsuit for damages against the party acting fraudulently, and the damages may include punitive damages as a punishment or public example due to the malicious nature of the fraud. Quite often there are several persons involved in a scheme to commit fraud and each and all may be liable for the total damages. Inherent in fraud is an unjust advantage over another which injures that person or entity. It includes failing to point out a known mistake in a contract or other writing (such as a deed), or not revealing a fact which he/she has a duty to communicate, such as a survey which shows there are only 10 acres of land being purchased and not 20 as originally understood. Constructive fraud can be proved by a showing of breach of legal duty (like using the trust funds held for another in an investment in one's own business) without direct proof of fraud or fraudulent intent. Extrinsic fraud occurs when deceit is employed to keep someone from exercising a right, such as a fair trial, by hiding evidence or misleading the opposing party in a lawsuit.

http://legal-dictionary.thefreedictionary.com/fraud

 

Another definition:

 

Constructive fraud is a legal fiction used in the law to describe a situation where a person or entity gained an unfair advantage over another by deceitful, or unfair, methods. Intent does not need to be shown[1] as in the case of actual fraud. Some unfair methods may include not telling customers about defects in a product.[2]

 

The elements are:[3]

 

a duty owing by the party to be charged to the complaining party due to their relationship;[4]

violation of that duty by the making of deceptive material misrepresentations of past or existing facts or remaining silent when a duty to speak exists;

reliance thereon by the complaining party;

injury to the complaining party as a proximate result thereof; and

the gaining of an advantage by the party to be charged at the expense of the complaining party.

http://en.wikipedia.org/wiki/Constructive_fraud

 

What about complicity? It has been pretty well proven that certain food products like Coca Cola do damage to people's health. How many studies do you want me to provide to substantiate this claim? Do you seriously want to be complicit in the consequences of investing in defective or unhealthy products? Fraud? How about knowing or ignorant promotion of products that lead to other people's decline?

 

To me the most outrageous violations of ethics in numismatics are the promoters of doctored raw product where you have no grading service putting its reputation behind the certified end result. NGC does that every day and you can be sure that they make tough, tough decisions to protect the numismatic integrity of their dealers every day. None of their employees can engage in the commercial promotion of numismatics, whereas PCGS does and can. Ultimately greed is a root cause of many evils. Not money but the unregulated, unprincipled, promotion and hunger for the love of money. You can maintain balance in business but it is not easy.

 

[DaveG]

Aside from Wall Street, if you think coins are bad, you should try art and antiques - you have the same "doctoring" and authenticity problems, plus you're talking about a lot more money.

[GoldFinger1969]

Aside from Wall Street, if you think coins are bad, you should try art and antiques - you have the same "doctoring" and authenticity problems, plus you're talking about a lot more money.

I don't want to come off saying "the rich deserve or can afford it" but if a billionaire gets taken by buying a $500,000 painting that is worth 1/10th that amount, it won't break him or her. Plus, they usually employ consultants who can verify the works. Finally, it's much easier to track the lineage of masterpieces of art than it is for most coins -- save maybe a few 1907 EHR Saints and other super-rare gold and super-expensive coins.

 

Trust me, I know, having managed money for these people for years.

[GoldFinger1969]

Nutmeg, I don't think the health benefits of Coca-Cola really constitute 'fraud' in any sense, either by consumption of the product or purchasing the stock.

 

My point is that shows like that Coin Show program should be forced to state what the retail value of the coins are that they sell. Markups of 100-500% to me constitutes fraud. These companies and individuals who are doctoring coins -- as Laura Sperber has written about -- should be given a cease-and-desist order and if they violate it, throw 'em in jail.

 

Penny-stock firms are scams, I know having worked at one (I sold legit stocks and mutual funds; they were the only firm that would hire me when I first started out, long story ). The Feds and regulators are aware of these scamsters but they would rather go after the Big Headlines gray-area Wall Street crowd with perp walks which usually involves one institution trying to screw another institution.

 

Penny stock firms hurt more people in a year than Lehman Brothers and Bear Stearns hurt in decades. Same thing applies with the Coin Shows and firms selling bogus bullion coins and other deceptive junk.

 

You have poor and middle-class people putting thousands or tens of thousands of dollars into this junk and it's more of a problem than a billionaire who loses a few hundred thousand dollars, trust me.

 

That's where the government should focus, IMO.

[James_OldeTowne]

To me the most outrageous violations of ethics in numismatics are the promoters of doctored raw product where you have no grading service putting its reputation behind the certified end result.

I think that's too narrow a definition. Really, the "the most outrageous violations of ethics in numismatics" is when ANYthing numismatic is promoted far beyond it's actual value through deceit, and that applies to certified as well as non-certified coins.

 

It's disgusting to see someone get ripped off on a raw coin. But to me, it's even more disgusting to see someone get duped into paying multiples for a certified coin, "just because it's certified". And we see that all the time. It's heartbreaking to hear what someone's elderly parents paid for their certified coins because they put their full trust in the vendor. I mean, you can always trust someone who only deals in certified items, right?

[Nutmeg Coin]

To me the most outrageous violations of ethics in numismatics are the promoters of doctored raw product where you have no grading service putting its reputation behind the certified end result.

I think that's too narrow a definition. Really, the "the most outrageous violations of ethics in numismatics" is when ANYthing numismatic is promoted far beyond it's actual value through deceit, and that applies to certified as well as non-certified coins.

 

It's disgusting to see someone get ripped off on a raw coin. But to me, it's even more disgusting to see someone get duped into paying multiples for a certified coin, "just because it's certified". And we see that all the time. It's heartbreaking to hear what someone's elderly parents paid for their certified coins because they put their full trust in the vendor. I mean, you can always trust someone who only deals in certified items, right?

 

I would agree with this, as there are too many rip-offs to name or characterize in some sort of hierarchy. Bottom line would be overpriced or misrepresented.

 

I was just looking at one particularly notorious coin fraud by Mr. Kearney and Romano:

 

"Two Long Island men were convicted Monday of conspiracy to commit fraud and money laundering in connection with a scam to cheat customers out of $30 million by using high-pressure tactics to sell coins at vastly inflated prices, federal officials said.

Michael Romano, 45, of Levittown, and William Kearney, 36, of East Islip, were found guilty of conspiracy to commit both fraud and money laundering after a six-week trial in U.S. District Court in Central Islip, officials said. The jury returned its verdict after a day and a half of deliberations. http://www.newsday.com/long-island/nassau/pair-convicted-in-coin-swindle-1.2954791

 

 

"The grand jury returned a second superseding indictment (the "Superseding Indictment") against defendants on November 10, 2010 in two counts, including conspiracy to commit mail and wire fraud and conspiracy to commit money laundering. The Superseding Indictment charged

that, between 1990 and 2008, defendants operated three telemarketing coin companies that "falsely informed the customers that the Benjamin Franklin half-dollars being offered for sale were [of the grade] MS-64 + or better and that the proof Benjamin Franklin half-dollars being offered for sale were MS-67, when actually the condition of the Benjamin Franklin half-dollars and proof half-dollars was of a lesser quality." (Sec.Sup.Ind.¶ 11-12.) The Superseding Indictment also alleged that once a customer purchased a roll or rolls of the Benjamin Franklin half-dollars, a more senior salesperson contacted the customer and offered to sell gold or silver coins; the defendants and those acting at their direction encouraged customers to continue purchasing gold or silver coins until they had completed a set. (Id. ¶ 13.) The Superseding Indictment further alleged that the defendants and those acting at their direction "falsely told the customers that the Subject Companies2 knew of other purchasers who had sold similar gold or silver coin sets for a profit" and "falsely told the customers that the Subject Companies would assist the customers with the sale of the gold or silver coins or, alternatively, that a salesperson would sell the coins on the customers' behalf at a coin show." (Id.) According to the Superseding Indictment, the defendants and those acting at their direction also "falsely told the customers that the Subject Companies employed a number of in-house graders, and made false statements about the background and training of the in-house graders purportedly employed by the Subject Companies." (Id.) The Superseding Indictment also alleged that "defendants and those acting at their direction misrepresented the grade and value of the Benjamin Franklin half-dollars and the gold and silver coins subsequently sold to the customers." (Id. ¶ 15.)

 

"After a five-week trial, a jury found defendants guilty of both counts. The evidence at trial showed that defendants conspired to devise and implement a scheme to defraud coin purchasers of money and property by the sale of coins at highly inflated prices by means of false and fraudulent representations. The evidence also showed that defendants conspired to launder the proceeds of the illegal activity.

 

"The evidence at trial was presented through many witnesses and exhibits. Several former customers and employees of the defendants' companies testified at trial. Defendants' motions specifically challenge the testimony of one witness, Swiatek, and one exhibit, government's exhibit 112A (hereinafter the "Valuation Chart").3"

http://www.leagle.com/decision/In%20FDCO%2020120504G81

http://www.justice.gov/usao/nye/pr/February14/2014Feb27.php

 

But on the larger topic of financial fraud it is frankly systemic. One TV huckster, Kevin Trudeau was sentenced to 10 years in jail yesterday for a variety of scams.

http://www.sfgate.com/news/crime/article/TV-pitchman-Kevin-Trudeau-gets-10-year-sentence-5323309.php

[EVillageProwler]

Dimon and Blankfein did not rig LIBOR. I'd like some evidence regarding the other claims.

[Nutmeg Coin]

I edited out what I can't verify.

 

OK, here was the comment:

 

"Trudeau goes to jail for selling $30 books full of BS. Jamie Dimon and Lloyd Blankfein not only had their fortunes back-stopped by US taxpayers, have been given special tax treatment, are allowed to manipulate commodity markets, rig LIBOR, sell fraudulent mortgage products, wreck hundreds of thousands of families finances, take their homes to sell to hedgefunds that they get paid to service, and personally invest in at very favorable rates, have their fortunes intact, but are still running Chase and Goldman and creating the next generation of malfeasance to be foisted on Americans versus rotting in solitary confinement in a federal prison in Colorado? Other dirtbags like Tom Morano, Scott Soltas, Jeff Verschleiser, et al who were the feet on the ground in the mortgage crisis variously have big jobs, nine-figure net-worths, or both. Yeah our system works. Shame on those corrupt Russians."

http://www.sfgate.com/news/crime/article/TV-pitchman-Kevin-Trudeau-gets-10-year-sentence-5323309.php

[$ilverHawk]

Dimon and Blankfein did not rig LIBOR. I'd like some evidence regarding the other claims.

 

Here you go.

 

http://www.examiner.com/article/a-look-behind-the-libor-banksters-at-the-real-culprits

 

And here.

 

http://www.thedailybeast.com/articles/2012/08/15/libor-scandal-widens-to-include-7-banks.html

 

Of course, these are just news articles reporting the on going investigation. The "evidence" will not come out until a settlement is reached. Then no one will know what actually occurred. That is the nature of justice when huge amounts of money are involved---calculated risk--if we don't get caught outstanding outcome, if we do get caught, we pay a fine significantly less than our profits, great outcome. The bank still profits.

[EVillageProwler]

Thanks for the response. I honestly didn't know that JPMC/Dimon were implicated in LIBOR.

 

As for your sources, I'd much rather see quotes from the FT or WSJ, or even CNN. The Daily Beast -- really?!? Seems like you just did a google search and posted whatever popped up.

 

EVP

[GoldFinger1969]

http://www.examiner.com/article/a-look-behind-the-libor-banksters-at-the-real-culprits

 

Economic and financial illiteracy on display. The writer probably was an English major who knows nothing about financial markets.

 

And here.

 

http://www.thedailybeast.com/articles/2012/08/15/libor-scandal-widens-to-include-7-banks.html

 

Ditto. (thumbs u