Is this Just Flat Out Wrong?

[braddick]

A Collector buys a coin from a Dealer with a ten day "no questions asked" guarantee. Scenerio "A" has the Collector buying a raw coin, scenerio "B", a slabbed coin.

 

Is it in poor taste for that Collector to "work the coin"? In other words, while the Dealer/seller is holding the Collector's funds, the Collector attempts to walk the raw coin through PCGS or NGC on a one day trip- looking for the score/upgrade. If the coin holders out- cool. The coin sticks and the Collector is happy. If it does not, the Collector breaks the coin out and returns it- all within the ten day grace period.

On the slabbed coin (scenerio "B" here-) the Collector looks for the upgrade or simple cross. If the coin works, he keeps it. If not, the original coin in the original holder is returned. The Collector is simply out the grading fee thus lowering his risk but increasing the potential if the coin was an upgrade candidate.

 

What is your moral impression and ethical viewpoint of the above? I know it is probably not illegal, but is it fair? Is the coin now no longer 'fresh' and somewhat tainted having been tried?

 

If the coin does turn into multiples of the original price is the Collector obligated to imform the Dealer and provide a kickback?

[sanmary]

If the raw coin were described as say MS64 then I think it would be morally acceptable to see if it truly grades as such. As a slabbed coin this would be a different matter. I feel it would be morally wrong to attempt such thing. However I'm sure it probably happens rather frequently.

[Todd-migration]

Morally wrong............

Yes I would say that it is morally wrong and I would never do such a thing unless as already stated the coin is said to be a certain grade and if it does not meet the criteria then yes back it goes and I would expect the same, but only for sight unseen coins. If I had a chance to look and agreed the coin has that chance then I am now taking it at my risk. However if it is done just to see if it would grade high enough to keep well that in my opinion is wrong. However the day and age we live in today everyone wants a deal and everyone wants money so some will do these things. I guess all you could do is shorten the return policy length. The few will ruin it for the majority.

[Elcontador]

Yes, it is flat out wrong in both situations, Pat. In your example, you are buying the coin "as is." Now re the raw coin, if you told the dealer, "I'll buy the coin only if it grades X, otherwise I'm returning it," and it is okay with the dealer, that's another story. I actually offered to do this re an NGC type coin on the condition it crossed to PCGS; the dealer declined, so I didn't buy the coin.

 

We see quite a few threads re how the dealer is trying to screw / mess with the buyer. To me this is the reverse. If we expect people to be honest with us, it's a two way street.

 

[gmarguli]

I think it is fine. The dealer offers a set time return privilege and the (potential) buyer takes advantage of this privilege. During that 10 days the buyer has the option of showing the coin to dealers, friends, etc. Why not the grading company? All he is doing is getting an opinion on the coin.

 

The PRODUCT is the same. The coin hasn't changed or been tainted. All that has happened is that the buyer has gotten an expert opinion on the coin.

 

As long as the coin and slab (if slabbed) haven't been changed, then there is no harm. The dealer is out nothing.

 

In fact, when I sell raw coins (which isn't often), I'd be happy for the buyer to submit the coin. I tend to grade conservatively when selling raw and I think it would be good for business.

 

I remember seeing feedback on eBay for Rettew where he sold a bunch of coins (proof Franklins) at lofty grades such as PF68. The buyer slabbed the coins and then negged Rettew when the coins came back PF65 and PF66. It helps keep the dealers honest!

 

I had one person try to return an NGC slabbed coin to me because it didn't cross over. He told me this was the reason. Wasn't too happy when I said no (because he took too long, not to mention the coin not crossing is not one of my reasons for accepting a return). He threatened me with negative feedback if I didn't accept the return. Too bad he was a insufficiently_thoughtful_person who didn't realize he already left me positive feedback when the coin arrived.

 

[truthteller]

There are two schools of thought, the old school says it is ethically wrong, the new school says anthing goes to make a buck. I'm from the old school, where collectors and dealers have integrity, so I'll give my opinion from that point of view. It is ethically wrong to take a coin, whether it be raw or slabbed and do anything more than 'pass or buy'. A coin sent on approval to a client with a ten day grace period means, the client can buy it or pass and has ten days to decide. A coin sent on approval to a dealer from another dealer may mean 'buy or pass' or 'send it to the customer to buy or pass'. To do otherwise is ethically bad. Not illegal, but bad business.

 

Example: Dealer buys an estate. An exceptionally nice coin is in the estate which is over 50 years old. The dealer has a customer for the coin on a want list. The coin is sent to the customer with a ten day return privilege. The customer receives the coin, shows 15 people, emails with pictures to 10 more people, changes his mind, and sends the coin back. Dealer then sends the coin to customer #2, but tells dealer that he was offered the coin by customer #1. Now the coin is 'stale' and dealer has lost potential sales and value.

 

 

Example:

I have seen this even happen, twice: Customer comes into store. Has an estate of coins. He is 'shopping' the deal for the best offer. This is his third stop. Dealer says, leave the collection overnight for evaluation. Meanwhile, the dealer sends 3 of the nicest coins to PCGS for overnight grading. Dealer then knows value of collection based on grades received. Customer calls back and dealer offers XXX amount. This scenario gives dealer #3 an unfair advantage over other dealers, not to mention the customer who did not agree to the sending of his coins to a grading service.

 

Just because the coin is in one's possession does not me the person can shop it around. Old school etiquette requires this. New school, new dealers see $$$$$$$$, bottom line.

 

TRUTH

[Hoot]

I don't see a problem here or any moral dilemna. Most guarantees are X number of days, no questions. If you send the coin through a grading service in that time is your business. If the coin makes whatever grade or crossover that you are after, then all is well, and you keep the coin. If not, it goes back to the dealer under the guarantee and no harm has been done. I don't see the moral or ethical issue even arising.

 

Guarantees improve business. So any single loss of a few dollars under a guarantee is simply part of doing the improved business.

 

Hoot

[TomB]

This is the type of scenario that I find to be, overall, neither black nor white. I will explain.

 

If the coin is sent out with a ten day return period and no other stipulations then I could see the potential buyer thinking that this was okay. However, should the seller ever find out what has taken place it is likely that the buyer will have lost a source for coins and some of his/her reputation after the seller speaks his/her mind.

 

If the above is acceptable to the buyer then it is fine with me if they decide to do that, however, in my own dealings I don't think I would feel comfortable with doing that, even though I might not believe it to be completely wrong.

[MarkFeld]

Here is part of the reply which I posted "elsewhere":

 

In answer to your question, Pat - I believe that unless permission is asked of and granted by the dealer, the coin should not be submitted for grading or regrading. A return privilege is generally granted in order to allow the perspective buyer an opportunity to decide whether he wishes to purchase the coin, not to allow him to try to profit on it.

[braddick]

Here is part of the reply which I posted "elsewhere":

 

In answer to your question, Pat - I believe that unless permission is asked of and granted by the dealer, the coin should not be submitted for grading or regrading. A return privilege is generally granted in order to allow the perspective buyer an opportunity to decide whether he wishes to purchase the coin, not to allow him to try to profit on it.

 

Mark, if that is the case, a coin is sold and the buyer is to decide, without outside professional "help" then why is it a standard to offer TEN days (or, in some cases I've seen more) for a return? Afterall, can't the Collector decide when he receives the coin? Why TEN days?

[truthteller]

Let's use another scenario. About 20 years ago, California had a three day right to recind contract for new car purchases, not so today. *** I go into a dealership, buy a car, knowing I have three days to bring it back and recind the contract. I drive the car off the lot, show my friends, we all ride the car, drive to Vegas, find out the car has NO CUP HOLDERS!!!!! What! Now I don't want the car because my friends say it's lame with no cup holders. Bring back the formerly new car with 350 miles on it to the dealer and get my money back. The next buyer doesn't want the car since it has high miles on it, so the dealer has to lower his price since the car is tainted.

 

I have had several car dealers tell me of this experience in the past. Was it illegal, no, was it immoral, probably. The one who lost out was the dealer.

 

TRUTH

[MarkFeld]

Pat, our standard return privilege is 5 business days (I think ), though we grant extensions if clients request it. Here are some reasons why a client might require more than a few minutes or days to make a decision:

 

1) Some clients might be out of town when the coin arrives or leave shortly afterwards.

 

2) Some clients like to show their coins to friends or other dealers to get opinions.

 

3) Some clients are very deliberate in making their decisions and prefer to "sleep on it" for a few days.

 

4) Some might have to ponder a potential sale/trade of another coin in order to make a purchase.

 

There are probably other reasons, as well, such as extremely busy schedules, having to make sure the wife is out of town in order to write a check in secrecy, etc.

 

And, in case someone is getting ready to ask - to me, there is a big difference between showing a coin to someone else in order to get a second opinion, vs. sending it in to a grading company for grading and allowing it to be out of your possession/sight.

 

We have had clients ask permission to send a coin for crossover, with the understanding that they will pay the fee and keep the coin if it crosses. But, I don't think things like that should be done without prior approval from the coin's OWNER.

 

If, for example, a client wants to be sure a coin is genuine, again, that is something to address with the owner of the coin.

 

Good thread!

[Dog97]

This thread has learned me one important thing! Next time I sell a coin I had better say Must be returned in original unopened holder for a refund.

Other than that I agree with gmarguli because when I sell a coin I have a 5 day return period and I really don't care what you do with the coin during that 5 days.

If you want to cherrypick me you can do it on your own time & on your own dime.

[keithdagen]

OK, new lingo for my auction listings:

 

No refunds for those within 100 miles of Sarasota, FL or Newport Beach, CA.

[mark]

I used to think my ethics were above reproach, but this thread has made me wonder. I agree with Greg: If the collector is given the coin for 10 days, he or she can do with it as he or she wants. Of course, if the coin is damaged, then I think the collector must pay for the damage, but otherwise I see nothing wrong with submitting the coin for a grade (if it's raw) or a cross-over (if it's slabbed). If the dealer doesn't want the coin submitted, put a condition on the 10 days, eg, you can have 10 days to make up your mind but the coin must not leave your possession. But, after reading this thread, I guess I do question my answer...somewhat...

 

Note that this situation is unlike the case of the California new car. In my description, any damage to the coin must be paid for by the collector, so if the coin acquires a juicy new nick (or 300 miles of mileage) the collector must pay for the damage.

 

Mark

[JD-migration]

Raw Scenario: The issue of Buyer purchasing a raw coin and sending it in for certification is largely moot. Virtually always, Dealer only allows returns if the coin remains in its original, unopened holder. You can't get it certified unless it's out in the open. As far as raw coins go, it frequently happens that a Seller (I refrain from using the term Dealer) overgrades the coin, hoping the Buyer is less skilled at grading and keeps the coin. Certification is a collectors insurance against this unscrupulous act.

 

 

Slab Scenario. If a dealer is willing to sell a slab with return option, key word = willing, then if a Buyer wants to go through the expensive gyrations to try and cross it with higher grade, there is no foul. Coin remains in original holder, Dealer allowed time with no stipulations attached. I think a Buyer who purchases a certified coin sight unseen (only internet pictures is essentially sight unseen in my opinion) deserves a return option. Many dealers do not provide detail attributes regarding strike, luster, spots, fingerprints and other distractions that occur on even certified coins. As such, returns should be an option.

 

It appears to me that this thread deals largely with a Collector taking advantage of a Dealers return policy. What's to fear?

 

 

[jtryka]

Well, speaking as a non-dealer seller, I really don't have a problem with it. If someone wants to sent it in, that's fine with me, but I'd advise against sending it to PCGS since I won't accept a return on a raw coin with a fresh new fingerprint on it! I do offer a 7-day no question return policy on all the coins I sell on eBay, and unlike some (based on reading this thread), I really mean it. If you return a coin within that time, I really don't want to know or even care about your reason for doing so. Just send it back. If you as a seller really don't mean "no questions asked," then don't say it, simply list as specifically as possible under what circumstances you will take a return. If I was a dealer, I might feel differently, but since I've never been a dealer, I have no frame of reference to render an opinion.

 

Would I do this myself? Probably not, though not because my conscience would keep me up at night, but simply because it's too much time and effort for me to bother. The only cases where I can see this practice being useful is on a coin of questionable quality, where cleaning or other problems are not as obvious. But this is more to protect me from a problem coin, not to take advantage of a potential upgrade for profit.

[DonHeath]

Seriously, I'm sure my logic is flawed, but in my mind I don't own the coin until I decide to keep it. I wouldn't submit a coin I didn't own. I would be submitting the sellers coin without their permission. If the coin is raw, odds are it wasn't sold at a holdered coin price, and if it was holdered, the buyer already has a third-party opinion. If the coin was submitted and came back two points higher, would the buyer compensate the seller?

[GDJMSP]

I understand all the points being made on both sides of the issue. And I find it hard to argue with any of them. But as I have throughout my life I have to go with I feel is right inside. And there is not even a hint of doubt - I could never do it.

 

This is a personal decision for me. I would have a hard time telling somebody else it was wrong for them - but for me - unh uh - no way.

[Oldtrader3]

Post deleted by Oldtrader3

[braddick]

Oldtrader3, I'm in complete agreement with you. You've hit all the points and are right.

[EZ_E]

I agree with OldTrader3, situation ethics is b.s. There is absolute morality. What is right is right and what is wrong is wrong. As a buyer, I see no problem sending in a coin to a third party grader in order to ensure the quality of a purchase if this is the sole reason for doing so. It would be unethical to try to profit because of a buyer's grace period. It certainly is no surprise to any seasoned collector that there are way too many unscrupulous dealers/sellers out there who consistently overgrade or send out problemed coins. If it were a perfect world, then we would all take each other's words for gospel, yet we know better.

 

There are still dealers out there with honor and integrity. I say boycot the damn crooks and patronize the honest ones!

[TomB]

Perhaps I'm slow, but, what does "CYA" stand for?

[gmarguli]

Perhaps I'm slow, but, what does "CYA" stand for?

 

Cover your as[/i]s.

[greghansen-migration]

I find myself comfortably in the minority. I do not see a problem with the conduct as posed. The hypothetical 10 day return was stated as "no questions asked". The point was made that a 'contract is a contract' whether oral or written. I agree...but the 'no questions asked' return provision is a part of the hypothetical contract. And if the contract has a 10 day no question asked return provision...does that condition become unenforceable or take on new meaning, depending on what the buyer does with the coin in those 10 days?

 

On a separate point, I think a 'no questions asked' return is a poor business idea from a sellers point of view. I think the appropriate business standard should call for a return in the same holder. I recognize that for slabbed coins in 3rd party holders, that still gives a buyer the opportunity to walk a coin through looking for a crossover...but they will have to pay for that service and battle the odds of getting the crossover. If their eye and success rate is that good, they should profit from their skill. After all, I had the chance to send it off for a crossover myself before I sold it, if I thought it merited the crossover.

 

So, in summary, I have no problem with the buyers ethics in this hypothetical...I only have a problem with the sellers business acumen.

[NPCoin]

Yes, it is morally wrong in the raw situation. With regards to some of the posts stating that is isn't "if it doesn't grade right" doesn't make a difference. You as the numismatist/collector should be knowledgeable enough to be able to grade the coin. Coin grading varies from person to person even within self proclaimed "professionals" such as PCGS and NGC. I have found a number of slabbed coins that to my own standards "missed the grade." I would rather trust a dealer or fellow numismatist that I personally know who has been in the hobby/industry for 30-40 years than a "grading" company with graders I've never met who may have personal interests in mind when grading my coins.

 

When determining a grade for a coin, the only authority in the matter is the one making the purchase. The seller may have their own opinion on the matter, follow strict ANA guidelines, utilizing magnifications even of up to 20x to be even more strict and to clarify any "cleaning" residuals, but in the end, the buyer is the final authority on the matter.

 

That is why most dealers will give a 5 to 10 day no questions return, so that you have the chance to personally grade the coin or have someone else you trust do so. If it doesn't meet the grade, return it...no questions asked. However, if you send out a raw, or take it to a one day turnaround with a "professional" grader and it becomes slabbed, you risk the possibility of scratching or nicking the coin when breaking it out. You risk the possibility of altering the coin to a state other than that in which you recieved it from the dealer. That is paramount to buying a new cpu, overclocking it and frying the sucker, then returning it to the computer shop as a DOA. You may get your money back, but it is a moral wrong.

 

And if you are not proficient enough to determine the proper grading for a raw coin on your own, you wouldn't be able to determine the minute defects that can be caused by cracking the coin out of the slab (or even possible defects caused by the graders themselves or the slabbing process). So eventhough the coin may "look right," morally, you face the possibility that it may not be! It depends on how moral you are

 

With regards to "professionally" graded coins, if you trust the grader, there's no difference from asking a friend or a "professional" as long as the coin (and the slab) are not damaged in any way. With a raw coin being slabbed and cracked, there is no way of NOT altering the coin in some way even if it is only around the rim. That makes a difference. The morality lies in the fact of whether the coin is returned to the dealer in the same condition in which it was recieved.

 

That ends tonight's sermon