Superior Gold Group, which sold gold coins and bullion and other precious metals, is alledged to have taken  payments from customers but never delivered the gold ordered, charged prices much higher than fair market value and misled customers into buying expensive specialty coins according to the lawsuit, filed Friday.

In their lawsuit, the agencies said Superior Gold took advantage of investors who flocked to gold as the price of the precious metal rose and the value of many other investments fell in recent years.

“By fostering fear and confusion among its customers, Superior has induced them to pay far above market prices for various gold products,” the complaint said.

In a report by The LA Times, they recounted one victims story…”

Steven Siry, 61, of Los Angeles is one customer who believes he was ripped off. Siry said he invested $20,000 in a “gold IRA” through Superior Gold. But company representatives sold him collector’s coins at an inflated rate rather than offering him bullion, and it took more than a year and numerous phone calls before the coins were delivered to the trust company that was to hold them, he said.

Siry estimates the actual value of the gold, when it finally arrived, as a little more than half of what he paid for it.

“It was a big mess, it was uncomfortable, and I felt kind of stupid, quite frankly, because I didn’t do enough shopping before I used them,” he said.

In another complaint the victim stated: “Nearly two years ago (Mar. ‘09), I purchased approx. $47, 000 worth of gold and silver coins (my entire life savings). I have yet to recieve (sic) a single coin! I have been calling for years and they refuse to give me my money back or to buy my coins,”

“Receiver Dean Pucci of the law firm Jones & Mayer took control of Superior Gold’s two locations in Woodland Hills and Santa Monica, Monday afternoon,” Santa Monica officials said. “Pucci was ordered by the court to secure the assets of the business and take over its operation.”

The court set a hearing for December 17, 2010 to decide whether the receivership and asset freeze will remain in place until the case goes to trial.

Former customers of Superior Gold Group who wish to file a complaint should go to this website:gold.smconsumer.org

Related posts:

1. PNG Offers Rewards, Security Tips After California Coin Dealer Burglaries
2. Liberty Dollar Office Raided by FBI – Gold and Silver “Coins” Seized
3. Judge Rules that Gov’t Improperly Seized 1933 St. Gaudens Gold coins

In two recent cases, “Howard” in Mississippi wired $20,000 several months ago to a California coin and bullion dealer to purchase gold coins, and “Richard” in Virginia sent $150,000 to the same dealer.  With the recent run-up in bullion prices they both would have made a nice profit, except they still have not received any gold from the dealer.  Howard laments, “All I’ve gotten is the run-around.”

“If you don’t know gold coins, you’d better know your gold coin dealer,” is the advice to collectors and investors from three nonprofit organizations: the American Numismatic Association (www.money.org), the Industry Council for Tangible Assets (www.ictaonline.org) and the Professional Numismatists Guild (www.pngdealers.com).

“There are many reputable, professional numismatists in the United States,” the three organizations emphasize.  “Before you make a purchase or offer something for sale, do your homework and check the dealer’s credentials.  For example, contact the Better Business Bureau to check the company’s BBB rating or if the company is even accredited by the BBB.”

A listing of Better Business Bureau accredited and rated companies nationwide can be found online at www.bbb.org.

The dealer that received the combined $170,000 in unfulfilled purchase orders from “Howard” and “Richard” had an “F” rating from the BBB.

Typically, dealers who are unresponsive to reasonable requests from customers seeking resolution of disputes are not involved in the mainstream of numismatics, but may advertise in prominent, mainstream news media.

Based on the experiences of the ANA, ICTA and PNG, and in consultation with law enforcement agencies, the three organizations suggest that buyers or sellers of gold coins who encounter problems consider taking these actions:

• Make copies of all correspondence, receipts and transactions and if possible have copies of advertisements or the dates and times ads were broadcast.
• Always contact the company directly to try to resolve the dispute.  Ask for the manager or company owner.
• Take thorough notes of your conversation(s).

If the problem is still not resolved after a reasonable amount of time, contact the Customer Service and/or Advertising Departments of the news media organization(s) that published or broadcast the company’s advertisements and let them know about the problems.

The ANA, ICTA and PNG advise: “It’s your money, so do your homework before placing an order, and if there is a problem then don’t just sit back and wait.  Be persistent in your efforts to resolve the dispute. Follow up with the company you did business with and the agencies where you’ve filed a complaint.  You may also want to consult with an attorney.”

Depending on the specific circumstances of the situation, one or more of these agencies also may be able to assist in the resolution of the dispute.

Numismatic Consumer Alliance, Inc. (www.StopCoinFraud.org) helps consumers secure relief for allegedly fraudulent and illegal conduct within the coin industry. Address: P.O. Box 144, Bedminster, New Jersey 07921.  Phone: (908) 781-7947.

Numismatic Crime Information Center (www.NumismaticCrimes.org) can help with investigative resources, information and direction for customers, dealers and law enforcement agencies.  Address: P.O. Box 14080, Arlington, Texas 76094.  Phone: (817) 723-7231.

Credit Card Companies if the purchase in dispute was made with a credit card within the past six months.  Call the Customer Service number on the credit card and inquire about doing a charge back for undelivered merchandise.

Local Police Department or Sheriff’s Department, the local District Attorney or County Prosecutor and the State Attorney General in the city, county and/or state in which you live or in which the dealer has a place of business.  Contact the law enforcement agencies in the city, county or state where the transaction took place.  Phone numbers can be found in the Government pages of local phone books or online.  A convenient listing of contact information for every state attorney general can be found on the National Association of Attorneys General website, www.naag.org.

Federal Bureau of Investigation or Secret Service depending on the dollar amount of the transaction and whether interstate commerce or counterfeit coins were involved in the transaction.  Phone numbers for the nearest FBI and Secret Service offices can be found in the Government pages of local telephone books.

United States Postal Service may be able to provide assistance if the transaction occurred using the U.S. Mail.  Go to your main post office and ask to talk with the local Postmaster or Postal Inspector.

American Numismatic Association (www.money.org) if the dealers involved in the dispute are ANA members and the dispute involves alleged violation of the ANA Code of Ethics, the association offers complaint mediation services for a fee based on the dollar value of the transaction.  Address: 818 N. Cascade Ave., Colorado Springs, Colorado 80903.  Phone: (800) 367-9723.

Professional Numismatists Guild (www.PNGdealers.com) if the dealers in question are PNG members they must adhere to the Guild’s Code of Ethics, support the PNG Collector’s Bill of Rights and must agree to binding arbitration to resolve any disputes involving numismatic merchandise.  Address: 3950 Concordia Lane, Fallbrook, California 92028.  Phone: (760) 728-1300.

Federal Trade Commission Consumer Sentinel Network (www.FTC.gov); however, don’t expect an immediate response.  The FTC usually responds when a significant number of serious complaints accumulate against a company, but it is still good to alert the FTC about unresolved disputes so they can be added to the agency’s files. Information about filing a complaint can be found online at www.consumeraction.gov.  Phone: (877) 382-4357.

Additional consumer protection information from the American Numismatic Association about “How to Buy Gold & Silver” can be found online at http://www.money.org/Content/NavigationMenu/ExploretheWorldofMoney/BuyingGold/default.htm, and the Professional Numismatists Guild offers consumer education information about “Three Things Gold Buyers Must Know First” online at http://www.pngdealers.com/item.php?item_id=129&category_id=2.

Related posts:

1. California Gold Dealer, Superior Gold Group LLC is seized, assets frozen
2. Another Gold Rush for Wilmington Depository
3. Consumer Alert: PNG Members Assist Investigations of Traveling “Hotel” Gold Buyers

By Laura Sperber – Hot Topics Blog

I say a heart-felt thanks to everyone who has emailed me support concerning the fight against coin doctors the past several months. Due to my hectic travel schedule, sometimes I just can’t respond to all your emails-but do know I read EVERY SINGLE ONE!

EVEN IF YOU ARE A NOT BIG DEALER, YOU COUNT

Every single person counts and is needed in this fight. Every single person has a voice that counts. Do not think there is nothing you can do.

You do not have to right on a blog like I do, you can just talk to your fellow collectors or dealers, at shows, clubs, or wherever. Send an email or a letter to the grading services, the numismatic organization, or the coin papers. The more “pressure” that is put applied, the better the results will be. If people don’t speak up it will be back to biz as usual for these bad guys.

A small dealer came up to me at the PCGS Invitational. He told me “I support you 100%”. He told me how badly he HATES the docs and anyone who is a mule for them. He told me how he has told one dealer friend why he won’t do business with him anymore and how he shoos away the docs from buying his coins. But he was upset because he felt he has no where to speak out. I told him if he can write a letter to an editor of a publication that’s great. I also told him-his voice has already spoken and he is a HUGE help. He definitely has the “RIGHT” attitude. Just imagine if very non doc did what he did-or had his attitude. I believe he also told me he is quitting the PNG.

At this point, the PNG has PROVEN (to me, in my opinion) with out any doubt to be the most WORTHLESS organization ever formed in coins when it comes to protecting the consumer and the coins themselves. As predicted, the PNG came up with a definition of coin doctoring and then all has been quiet since. I was totally disgusted that one of the PROVEN trouble makers of the PCGS lawsuit proudly displayed his PNG flag and was set up and doing business PNG day. That is a slap to EVERYONE (from the smallest collector to the biggest dealers). Meanwhile a high ranking PNG official told me he thought I was grandstanding on these issues for publicity. That’s why nothing makes me prouder than NOT being a PNG member.

I BELIEVE THIS IS THE BACKBONE OF TODAY’S PROBLEMS

Nothing disgusts me more than how dealers-especially young dealers disrespect the coin business. I watch the brightest potential talent all lean toward being “crack out” dealers and eventually fading in to full coin doctoring. Why isn’t the PNG working to scare them straight? Why can’t they educate them that coins are a treasure that need to be carefully saved in their original form? We desperately need to break this negative attitude or in 20-30 years it is a real possibility that the % of coins that will have been messed with in as high as 50%. The docs are all about making money. They will do whatever they can to a coin to gain a profit.

All the dealers refuse to blame their buddies or are in pure denial about the issues. So many dealers tell me I am so wrong and that its the grading services who should catch the bad coins. Here is what they need to wake up too: DEALERS WHO FEEL ITS THEIR RIGHT TO VIOLATE THE GRADING SERVICES SUBMISSION CONTRACTS AND FRAUDULENTY SUBMIT “WORKED ON” COINS. Key word: FRAUD. These guys should not only be exposed, but they should be forced to pay back ALL their ill gotten gains in multiples and perform numismatic community service of retraining and supporting dealers from NOT being doctors.

THE PCGS LAWSUIT HAS STARTED TO SHOW SOME CHANGE

I was speaking with John Albanese (the founder and finalizer at CAC). He confirmed to me that the amount of “messed with” coins he has seen since the lawsuit has been seriously reduced. That’s a huge plus. But that does not mean these rats are on the run. As evidenced in a Coin World Article recently, even after the lawsuit was filed one of the defendants still had the disgusting audacity to be ready to doctor more coins. So as you can see, this is nasty and serious war against sick and greedy individuals.

We have to make sure new techniques don’t allow the doctors short terms wins. The only way to do that, is what I said before: put pressure everywhere and make an imprint.

WHY IS YOUR DEALER NOT PUBLICLY COMMENTING?

If you lived in a town where the toxins were found in the drinking water, you’d be fighting like mad to correct it, prosecute the actors and make things safe again. The coin market IS that town. Why does your dealer not comment? They could be best friends with a doc. They could BUY from a doc (many dealers do not care where their coins come from if they are cheap), they could be a mini doc themselves.

I believe EVERY dealer has a responsibility to protect ALL coins-whether rare or not. Hey, if they do not believe this-dump the creeps. Coin collecting is about coins remaining in their NATURAL states of preservation.

If what I say here sounds redundant, it probably is. I am afraid that if I stop writing about nailing these guys and making changes with organizations like the PNG, things will really go to hell. Education of collectors to spot bad coins helps, but it is no where near close to the real pressure that needs to be applied. I will always keep my offer of paying a $1,000.00 reward/gift if the PNG ever busts a coin doctor. Unfortunately, I expect to hit a Multi-state Lottery Billion dollar Jackpot before I ever have to pay out one cent. I thank the 14 people who emailed me and offered to offered monies in too.

WHY DON’T I NAME NAMES?

Simple, the bastards will sue me. Call me stingy, but I am not in the mood to pay $500,000.00 out in legal fees or take the small chance of losing (I do have access to the BEST lawyers in the US though). Besides, most collectors do NOT know or have access to the docs. All they would do is gossip on the chat rooms. I have tried hard to give dead on tips as to who or where some of these bad guys nest. Keep in mind, even though we ALL have been violated in some fashion by the docs, PCGS has been harmed directly with a broken contract. I predict a slam dunk win by PCGS. I hope after this first suit, they do another and another until the white flags appear at the docs bourse tables.

I AM A COIN COLLECTOR TOO

I will fight to the end on the issue of coin doctoring. Sure there are other bad things that happen (scams, overpricing, etc), but those seem isolated. Twenty years ago when certification started they promised you a safe and reliable product. We need to make sure the integrity of the product remains strong. For a few years, the services took their eyes off things and now they are playing catch up to fix things (from what I can see-PCGS and NGC are doing a great job). But those few years gave the bad guys the room they needed to grow and entrench themselves in corrupt practices. As a collector, this kills me. NOTHING is a worse crime in coins than to see a Saint with metal moved, a PL that is fake PL, heads falling off, a puttied coin, etc. I wish there was some oath ALL dealers had to take to prevent them from being docs. Since I see few other major dealers even so much as commenting privately to stop these practices I will be the lone voice for as long as it takes. I love coins and care very much about what is happening today and what will happen in the future.

I can be reached at lsperber1@hotmail.com. Again, do know because of my current hectic schedule I might not be able to reply to all the emails I get. I will read every single one though.

Related posts:

1. Commentary: Thoughts on the PCGS Lawsuit Against Coin Doctors
2. David Lawrence Rare Coins View on PCGS’ Hard Stance Against Coin Doctors
3. Federal Lawsuit Filed Against “Coin Doctors” by Collectors Universe / PCGS

A Weekly Column by Greg Reynolds

I. The filing and re-filing of this lawsuit

Over the last forty years, especially from the late 1990s to 2006 or so, the coin collecting community has suffered from the terrible problem of coin doctoring; coins are deceptively altered for the purpose of tricking experts, particularly those employed by the PCGS and the NGC, into concluding that a coin is of higher quality than it was before it was doctored. The process of doctoring a coin reduces its level of quality and, in many (though not nearly all) cases, permanently damages the coin. Coins ranging in value from less than $50 to more than $1 million have been doctored.

In many instances, doctored coins ‘turn’ at a later time, as unintended byproducts of doctoring processes result in unsightly delayed chemical reactions or the decomposing of added matter on the doctored coins. It is not unusual for a coin doctor to deliberately harm (often permanently) a coin that grades MS-64 in order to try to deceive experts into believing that it grades MS-66.

John Feigenbaum is president of David Lawrence Rare Coins (DLRC), and has been involved in the coin business for more than twenty years. In 2004 and 2005, DLRC sold one of the fifteen greatest collections of classic (pre-1934) U.S. coins ever to be publicly auctioned. Feigenbaum says, “in general I [John] applaud PCGS for taking action on this matter, and I think they should take any and all actions in the future towards parties that are trying to slip doctored coins past them.”

In my column of June 2, I analyzed the CU-PCGS lawsuit against alleged coin doctors, which was filed in late May. I encourage readers who wish to learn about this lawsuit, its importance and its implications, to read my column of June 2nd. On Aug. 10, CU-PCGS filed a “second amended complaint” along with a new motion.

II. The basics of the lawsuit

Although technically PCGS is a subsidiary of Collectors Universe (CU) and it is CU that filed this lawsuit, the PCGS predates CU and the PCGS is the core of Collectors Universe. Further, the PCGS certifies coins. So, it is clear and helpful to refer to the plaintiff as the PCGS as the lawsuit concerns allegations that dealers deliberately submitted doctored coins to the PCGS, without disclosing intentionally added defects, for the purpose of deceiving graders at the PCGS into assigning higher grades to such coins than the coins would have merited before they were doctored. Coin doctoring, of course, reduces the grade of a coin, often to the point where the coin no longer merits a numerical grade.

The submission contract that each dealer signs to be a dealer-submitter of coins to the PCGS for grading and authentication prohibits dealer-submitters from sending in doctored coins for numerical grading. At the very least, it is argued that dealers who submit doctored coins for numerical grading have breached their respective contracts with the PCGS. Moreover, the PCGS argues in the lawsuit that such coin doctoring is in violation of several Federal and California State laws. Curiously, attorneys for the PCGS declare that conspiracies to doctor coins and submit them to the PCGS fall under RICO statutes, and are thus said by the PCGS to constitute racketeering.

Importantly, attorneys for the PCGS argue that coin doctoring is not just a civil offense, a racket and a breach of contract. Attorneys for the PCGS maintain that coin doctoring is a crime under Title “18 U.S.C §331,” which is cited in the lawsuit as follows, “Whoever fraudulently alters, defaces, mutilates, impairs, diminishes, falsifies, scales or lightens any of the coins minted at the mints of the United States … [or] … Whoever fraudulently possesses, passes, utters, publishes, or sells, or attempts to pass, utter, publish or sell … any such coin, knowing the same to be altered, defaced, mutilated, impaired, diminished, falsified, scaled or lightened … Shall be fined under this title or imprisoned not more than five years or both.”

There is not space here to discuss why natural toning is highly favored by sophisticated collectors and why ‘coin doctoring’ is extremely harmful. Please read my three part series on the collecting of naturally toned coins, in which dipping and coin doctoring are discussed: Part 1, Part 2, and Part 3.

III. The Concept of Coin Doctoring

In my analysis on June 2, I repeated the PCGS definition of coin doctoring and also another widely accepted, though less formal, definition. Here, I will move in the direction of composing my own definition, which is aimed to be very much consistent with the PCGS definition and others that are widely accepted. Such definitions are not arbitrary are not the products merely of opinions or wishful thinking. Accepted definitions stem from values that evolved over the history of coin collecting, and are consistent with Federal and State Laws (such as those cited in the PCGS lawsuit).

John Albanese states that the nature of “the wrongdoing is obvious to reasonable, ordinary people. Coin doctoring is fraud.”

Though I understand how beginning and intermediate level collectors and onlookers may become confused by definitions of coin doctoring, the reality is that expert dealers, and also advanced collectors who have the motivation and time to become involved in the coin collecting community, mostly have consistent concepts in their respective minds regarding that which constitutes coin doctoring. There is more objectivity and far less opinion involved than non-experts and other onlookers realize.

For most doctored coins (except relatively minor cases of artificial toning), the nature and extent of the doctoring can be conclusively demonstrated. There is just not much opinion involved, in most cases. Moreover, technologies that are being developed and implemented by the PCGS will provide scientific evidence of additional cases of coin doctoring. Similar technologies could be refined and employed by others who wish to identify doctored coins.

While a team of experts can certainly identify doctored coins with nothing more than their minds and magnification, these technologies have the potential to scientifically document, for a wider audience, instances of coin doctoring. The ‘Sniffer’ technologies, which PCGS is refining, include the ability to conclusively identify the chemical components of foreign substances that are added to coins to cover imperfections and also include the ability to show the consequences, in terms of chemistry, of deliberate modifications in the metal of a coin.

Generally, in any field of human endeavor, a rule that separates legitimate practices from wrongdoing cannot be effectively applied in all instances. There will be cases where it is difficult or impossible to ascertain whether wrongdoing has occurred. In the realm of coin doctoring, there are borderline cases. A very large majority of instances of coin doctoring (except cases of artificial toning), however, can be proven beyond a reasonable doubt.

Consider some of the instances cited in the lawsuit: The adding of a fabricated head to a relatively flat head Standing Liberty Quarter is clearly coin doctoring. The slicing and rebuilding of the bands on the reverse (back) of a Mercury Dime is clearly coin doctoring. The use of a laser to obliterate hairlines (narrow, shallow scratches) by somewhat melting and smoothing the metal surrounding the hairlines is obviously coin doctoring. The adding of a “foreign substance,” perhaps auto putty or a paste created in a laboratory, to cover contact marks is doctoring. More than 95%, and maybe even 99+%, of rare coin experts (who are familiar with accepted grading practices) would be in agreement (if they all honestly revealed their respective thoughts) that cases such as these constitute coin doctoring.

Generally, coin doctoring is not about repairing coins that have been damaged or about removing miscellaneous stuff that adhered to coins in an ocean before these were found in shipwreck. Likewise, if a coin must be modified to be identified; it is probably not being doctored. A coin that is polished solely for use in jewelry is not being doctored either, though I would strongly recommend against anyone polishing coins. A practice that is harmful to a coin, or even destroys it, is not necessarily coin doctoring.

Coin doctoring involves harming a coin for the purpose of deceiving experts (or in such a way that experts would be likely to be deceived), along with everyone else who is interested, into falsely believing that the coin is of higher quality than it was before it was harmed. The harm does not have to be permanent; it just has to be deceptive or potentially deceptive to leading coin experts.

IV. Dipping is Not Coin Doctoring

In the realm of rare coins, dipping refers to the practice of immersing a coin in an acidic solution for the purpose of tearing layers off the coin to brighten the coin, remove toning and/or remove other matter that has adhered to the coin. While most (though not all) sophisticated collectors would agree that dipping a coin is harmful, it is not deceptive to experts or even to intermediate level collectors.

If a valuable silver coin is dipped and then submitted to the PCGS, the graders will, in most cases, immediately realize that it had been dipped. More than two thirds of all uncirculated 19th century silver coins have been dipped at one time or another. Obviously, all such coins are not regarded as having been doctored. Besides, some knowledgeable collectors and many expert dealers honestly maintain that the benefits of dipping typically outweigh the harm done. Hardly anyone would say that about coin doctoring. No respected coin expert has ever said that the benefits of lasering, of adding auto putty, of polishing, or of adding metal to a rare coin outweigh the harm done.

I am bothered that some misguided individuals conclude that I am advocating dipping, because I point out that dipping is not doctoring. I am NOT recommending dipping coins.

Dr. Steven Duckor, a famous and very accomplished collector, agrees that “dipping is not in any way ‘coin doctoring,’ though [Duckor] personally would never [deliberately] buy a dipped coin nor would [he] dip a coin”! For “forty years,” Dr. Duckor has sought “original, toned coins, the more natural the better!”

I believe that more than 90% of the coins that have been dipped should not have been dipped. In my view, though, there are coins that should be dipped. Sometimes, toning is so thick and unfortunately formed that it covers characteristics of a coin, which really should be seen. Moreover, sometimes foreign matter (not toning) adheres to coins in such a way that dipping is the least harmful method of removing such matter. I acknowledge, however, that dipping is a widely accepted practice.

“The majority of the numismatic community thinks [that] dipping can be OK,” David Hall relates, “though of course overdipping is a negative.” Note the words “can be” rather than “is”!

V. The Additions to the Lawsuit

The second amended complaint, which is the revised lawsuit, includes evidence that has been gathered since the first amended complaint was filed. Here, the word ‘complaint’ refers to a lawsuit.

G. Krill and R. Wesselink are defendants in the lawsuit. The PCGS claims that the PCGS has evidence that Krill and Wesselink continued to conspire to have Wesselink doctor coins sent to him by Krill for the purpose of Krill, or someone affiliated with Krill, eventually submitting such doctored coins to the PCGS for numerical grading.

The plaintiff (CU-PCGS) argues that a package of coins, which Krill planned to ship to Wesselink, was sent, evidently by accident, to the NGC, the leading competitor to the PCGS. The PCGS and the NGC are the two leading grading services. Officials at the NGC alerted officials at the PCGS when this package was received. The NGC then sent the contents of this box to the PCGS.

The suit lists four specific coins that the PCGS alleges that Krill intended to send to Wesselink, with instructions allegedly from Krill, for Wesselink to ‘doctor.’

Donn Pearlman, a public relations consult for CU-PCGS, provided images of these coins. The depicted handwritten notes are said by CU-PCGS to be from Krill to Wesselink.

Did the writer of these instructions employ the term “clean up” as a euphemism? After all, the term ‘clean’ has a specific meaning in the coin collecting community. Though it is now recognized as a harmful practice, it was common for coins to be ‘cleaned’ by way of wiping motions. A cleaning usually left hairlines, and, unbeknownst to the cleaner, a cleaning reduced the grade of the coin. So, it is unlikely that the handwritten notes actually refer to cleaning. What then was meant by “clean up”?

On an 1861 Half Eagle ($5 gold coin), the handwritten instructions call for “a very light clean-up to make new”! A cleaning would certainly not “make” a coin look “new”! So, what do these instructions really mean? The PCGS argues that Wesselink was asked to “make” a coin that is not “uncirculated” look as though it is so.

One of the coins in the package is in a PCGS holder. It is an 1851 one dollar gold piece that has been assigned a grade of MS-63 by the PCGS. It also has a sticker of approval from the CAC. Though I cannot really draw a conclusion from an image, it appears that it might be a very desirable coin. The handwritten instruction specifies a “light clean-up”!

As this coin is encapsulated, it would have to be removed from its PCGS holder to be modified. It is logical to theorize that the intent would be to re-submit the coin to the PCGS or the NGC for the purpose of receiving a grade that is higher than MS-63. I cannot think of another reason for a coin expert (outside of PCGS) to remove it from its PCGS holder, especially since it has a sticker of approval from the CAC. There are collectors who remove coins from PCGS holders because they wish to hold them, but the activities of such collectors are probably not relevant to this case. Therefore, if a “light clean-up” is aimed at changing a MS-63 grade coin such that experts may grade it as MS-64 or higher, what could a “light clean-up” mean? Is it fair to conclude that Krill is asking Wesselink to doctor these coins for the purpose of deceiving PCGS or NGC graders into believing that they merit higher grades than they ever really merited? I do not know.

In addition to listing coins that were allegedly sent by Krill in the package just cited, the amended lawsuit contains a slightly different list of examples of coins that were allegedly doctored and/or submitted by the defendants. (See section 14, pages 9-10 of the first amended complaint and section 16, pages 10-12, of the second.)

VI. The Larger Picture

CU President and PCGS founder David Hall has indicated that a settlement in the very near future is unlikely and he seems to look forward to information that will be unearthed in the discovery process. I (this writer) believe that an early settlement would be a mistake. John Albanese remarks that “the keys will be in the discovery” proceeding. It is really necessary to unearth more information relating to coin doctoring. If the defendants do or will maintain that they have not done what they are accused of having done, then most of the coin collecting community would be interested in their explanations regarding the allegedly doctored coins cited by the PCGS.

Albanese believes that “in the short term, it will be tough” to  address the coin doctoring problem. “Over the long term,” John says, this lawsuit will be “a huge positive. It will increase confidence.” Albanese already finds that he sees “less than half as many doctored coins” during the course of business then he did before the PCGS filed this lawsuit in late May.

It is important for collectors to realize and accept the seriousness of the coin doctoring problem. I have seen thousands of doctored coins in PCGS or NGC holders. John Albanese reports that  “more than five percent” of the PCGS  certified coins that have been submitted to the CAC have been doctored.

As I already mentioned, many doctored coins worsen over time. Also, most collectors learn from experience. Numerous collectors who do not know that they currently own doctored will eventually find out. Collectors and potential buyers of coins will have more confidence in coin markets and in the coin collecting community if the coin doctoring problem is contained.

©2010 Greg Reynolds

Related posts:

1. Coin Rarities & Related Topics: The PCGS Lawsuit Against Alleged Coin Doctors
2. Federal Lawsuit Filed Against “Coin Doctors” by Collectors Universe / PCGS
3. Coin Rarities & Related Topics: The PCGS SecurePlus Program, Part 1: An Explanation

At the Baltimore Show I heard many rumors about the PCGS lawsuit. One was great-but also was especially disturbing.

That rumor was that PCGS and some of the “named” defendants in the suit were discussing a possible settlement. That news is terrific! Or is it? I should point out what I heard is ONLY rumor and I have not spoken to anyone from PCGS about it. Legend FULLY supports PCGS in this lawsuit and its efforts to stop coin doctors.

PCGS is absolutely deserving of being refunded with penalty for all the damages these disgusting people have caused to them. A note to promising to cease probably will be included in any settlement. So I started to think, if there should be a settlement where does that leave the rest of us? The others who have been damaged by coin doctors actions with no restitution?

I believe it leaves us right back where we started. The coin doctors will just continue on their merry way. Sure, one small group is down, but the others all got away-with out so much as even a slap on the wrist (assuming there is a settlement). Of course since I had my meeting with my favorite party club of dealers-The PNG, they have issued only one statement and seem to be intent of claiming to try and define what makes up the standard for a coin being doctored (my bet is they will NEVER end the debate). Of course that will have to wait until their next meeting, then the board has to discuss, yada, yada.

EVERYONE MUST TURN ON THE PRESSURE NOW

Collectors, its going to be up to you to make changes apparently. Talk to your dealers. If they do not become vocal about this, before you walk out the door for good, ask what they could possibly be afraid of? How can any dealer not see coin doctoring as a serious crime? Ignoring it will not make the dirt bags who do it stop. Do they really believe this does not affect them? So far I have only seen 3-4 dealers actually speak up. All others seem to be hiding on corners.

Anyone who cares needs to speak up NOW. Keep writing letters to the PNG. Write letters to Coin World. Discuss the subject on the gossip boards. Write the grading services too.

THE PNG IS A DISGRACE

They just do not get it. They make too many excuses. “Bring us a complaint and we will follow it up” or my favorite: “its the grading services fault”. At the Baltimore show two members (including a board member) said these statements to me. What planet are these guys from? It does not matter if the grading services are having trouble catching doctored coins or even if they are incompetent (which they are not). The issue is the fact that there are several KNOWN unquestionable coin doctors in PNG who send coins in FRADULATELY to be graded. That’s a hell of a difference from buying a doctored coin unintentionally.

SOMETHING MUST BE DONE TO CHANGE THE DEALER MENTALITY ABOUT THIS. The PNG leadership needs to CHANGE its members attitudes. Of course another PNG defense is what about the non members who doctor coins? Just get your own damn house in order! Make it so ANYONE who ever doctors a coin is scared. And quit lying to the public that your organization has the most honest and ethical dealers in it. If you care about the entire hobby, then get off your butts and do something NOW!

WHAT CAN WE REALLY DO?

In the end, coins are too neat and people do love collecting them very much. If we can not police ourselves, then its time for some one to do it for us. I would call for government intervention with harsh penalties for ANYONE who destroys a coin for monetary gain via fraudulent activity. All we can do right now is put as much pressure on as possible and wait. Even if most dealers turn out to be a bunch of greedy shameless putzes, collectors out number them by far and really can make a difference. It will be very interesting to see if the PCGS Lawsuit does indeed get settled. Just remember, if it does, the war against coin doctors is not even close to being over.

I am not afraid to speak my mind about this. I do not care what dealers think of me for doing so and I am NOT seeking extra business from this. I have been a passionate collector of coins all my life. Now, I am fortunate to be able to make a living doing what I love. To me, coin doctoring is a horrible crime to the hobby. In fact I am only getting more angry at my fellow dealers lack of caring. There simply is no excuse. My stance against the PNG is deepening as I fear they are doing the coin business more harm than good. PCGS made the right move by filing suit-enough is enough. And I really do want to see an end to the coin doctors and their associates almost free run of destruction.

Next time your gold coin turns blue, the cheek of your Morgan Dollar turns black, or your copper coin turns totally disgusting, speak out. Coin doctors can be forced to stop.

THIS ARTICLE REPRESENTS THE OPINION SOLEY OF LAURA SPERBER.

You can email me with any comments or questions – lsperber1@hotmail.com

Related posts:

1. Laura Sperber: 2010 IN REVIEW-MY VISION
2. Numismatic Landscape – Commentary by Laura Sperber
3. Laura Sperber Meets with PNG Board to Discuss Coin Doctoring