A consumer watchdog organization has recovered nearly $900,000 for buyers who paid far more for coins than they were worth.

The money represented full refunds in 16 recent disputes, according to the New Jersey-based not-for-profit group, the Numismatic Consumer Alliance, Inc. (NCA).

The consumers had purchased the coins – mostly overpriced bullion coins and other modern issues – on the basis of telemarketers’ sales pitches, NCA said. It said the Alliance was able to obtain full refunds totaling $884,769 for coins which were worth a fraction of their purchase price.

“Many of these buyers,” NCA said, “were senior citizens with no knowledge of coins who also lacked the Internet savvy to check out what they were buying and who they were buying it from.”

The Alliance has now recovered a total of more than $4 million for such consumers since becoming operational in 2005. NCA intervenes on these buyers’ behalf, engaging legal and other professional assistance if necessary, in an effort to ensure that coin consumers are getting their money’s worth.

The Alliance is reviewing other disputes involving coins for which consumers paid more than $10 million.

NCA seeks no compensation when it enters a dispute on behalf of an aggrieved consumer – even though it frequently incurs substantial legal bills and other expenses in the process. Funds to cover such costs are contributed by coin dealers and collectors who share its concerns. On several occasions, consumers who were aided by NCA subsequently donated funds to help it continue its work on behalf of others. (more…)

Lafayette, CO (PRWEB) May 13, 2009 — When a retirement investor wants to buy gold or other precious metals through their IRA, metals dealers frequently sell “proof coins” noting that proof American Eagles are specifically allowed by the IRS. These “proof coins” usually cost an additional 20-25% beyond the value of the coin itself and are not required for a self-directed IRA, according to Bill Humphrey, CPA and Vice President of Entrust New Direction IRA, Inc, a self-directed IRA/401(k) administrator. The investor may be having their IRA pay for the wrong proof.

No longer will retirement investors need to pay 20-25% extra. First State Depository, which provides precious metal storage, is now working with Numismatic Guaranty Corporation (NGC), the industry leader in coin certification, to offer a new service which provides proof of the metal content and purity of the coin for much less than the cost of “Proof” Gold Eagles.

Humphrey said, “People who buy gold with their IRAs are often not given the option of non-proof coins.” Often, the proof coin seems more valuable because of the description of a specialized minting process and the special mounting and special plastic capsule that the coin is shipped in. Humphrey explained, “Proof coins are not required for IRAs and often cost significantly more than the equivalent non-proof coin containing the exact same amount of metal. IRA owners investing in Gold coins with IRA funds should make sure they understand what they are buying.”

According to Humphrey, clients wanting the guarantee of gold content of the coins may want to look at a new service offered by First State Depository, a company which provides precious metal storage. First State is working with Numismatic Guaranty Corporation (NGC), the industry leader in coin certification, to offer a service which provides proof of the metal content and purity of the coin for much less than the cost of Proof Gold Eagles. (more…)

Mark Naber, founder of ForgeryNetwork.com, answers a few questions about collectable coin forgeries and the purpose of ForgeryNetwork.com.

How bad is the risk of buying counterfeits?

This really is quite a complicated question, depending on what you buy, what venue you buy through and your expertise in the area you collect and your ability to identify the tell tale signs of counterfeits. The dealer and geographical location of where your buy your coins will also impact the risk of buying a counterfeit. For example, if you are inexperienced collector looking for bargains on EBay from unknown dealers, in places such as China, you will almost certainly purchase counterfeits. On the other end of spectrum if you are experienced and buying from reputable dealers whom are experienced in that area, your risk is very low. Knowledge of what you are buying and whom you are buying through is the key to lowering risk. This is nothing new to most seasoned collectors, but it is unfortunate to see new collectors falling into these traps.

What would you advise new collectors to do?

The best advice I would give new collectors is to start small and slowly gain the knowledge as you go. By small I mean don’t spend much – let your spending habits slowly increase along with your expertise. Buy from reputable dealers whom specialise in what you wish to collect, join relevant clubs and discussion boards on the internet and learn; there is a wealth of information nowadays thanks to the internet. There is also a rule of thumb that one should spend 5%-10% of your annual collection budget upon books about coins and coin forgeries. The most risky thing a new collector can do is look for bargains without adequate knowledge. The old saying applies – If it’s too good to be true, it probably is. (more…)