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Millions Lost From Coin Fakes, Hobby Leaders Warn

Chinese-made counterfeit coins pose a significant financial threat to unsuspecting consumers, according to leaders of five of the country’s most influential rare coin organizations. They warn the public is spending millions of dollars on fake U.S. coins offered in online auctions and elsewhere, such as flea markets and swap meets.

fake_1915-D_5In a jointly-issued consumer advisory (below) the groups caution the public not to purchase any so-called “replica” coins because they may be in violation of federal law. They also urge consumers to only purchase genuine rare coins from reputable, professional dealers or face the risk of losing money on copies that are illegal to re-sell.

Below is the consumer protection warning issued by (in alphabetical order) the American Numismatic Association (www.money.org), the Industry Council for Tangible Assets (www.ICTAonline.org), Numismatic Guaranty Corporation (www.NGCcoin.com), Professional Coin Grading Service (www.PCGS.com) and the Professional Numismatists Guild (www.PNGdealers.com).

Hobby periodicals report that more than a million counterfeit coins manufactured in China have been fraudulently sold in the United States posing a significant financial risk for unsuspecting consumers. Buyer beware! Consumers who buy an item based only on its perceived rarity and who have no knowledge as to how to determine whether the coin is genuine subject themselves to great risk of losing their money

The American Numismatic Association (ANA), the Industry Council for Tangible Assets (ICTA), Numismatic Guaranty Corporation (NGC), Professional Coin Grading Service (www.PCGS.com) and the Professional Numismatists Guild (PNG) urge consumers to educate themselves before making purchases: know what you are buying and purchase only from reputable, experienced rare coin dealers (professional numismatists).

“We believe many of these counterfeits subsequently are being resold as genuine rare coins in online auctions and at flea markets and swap meets,” said Clifford Mishler, ANA President.

“Millions of dollars already have been spent on these fakes and potentially millions more may be unwittingly lost by consumers who mistakenly think they’re getting a genuine rare coin,” warned Paul Montgomery, PNG President.

It is a violation of United States federal law to sell unmarked replicas. The U.S. Hobby Protection Act, first enacted in 1973 (Public Law 93-167 15 US Code §2101 et seq) requires manufacturers and importers of imitation numismatic items to mark them plainly and permanently with the word, “COPY” in accordance with the Code of Federal Regulations (16 CFR part 304).

png_fake_1916-d_10cThousands of coins described as “copy” or “replica” are listed for sale in online auctions every day. There also are numerous reports of replica coins being exported from China without the word, “COPY,” incused in the surface as the law requires. On most on-line offers, photos of the replica depict the word, falsely showing consumers a different product than the one they’re actually buying.

“We believe many of these are simply counterfeits that eventually will be purchased for significant amounts of money by unsuspecting buyers,” said Fred Weinberg, ICTA Chairman.

Coin World, a respected weekly hobby publication, recently reported that 99 percent of the “replica” items sold into the U.S. market do not contain the required “COPY” markings. One counterfeiter in China told the publication he already has produced and sold more than one million coins.

To protect the public, our organizations are aggressively working to

  • combat the unrestricted imports of counterfeit coins;
  • halt the fraudulent offerings in online auctions;
  • explore asking for legal actions by federal law enforcement agencies against importers and re-sellers of illegal numismatic items;
  • explore united legal action by our organizations to protect the public.

“Even during the recession, the United States rare coin market remains vibrant and active with an estimated $5 billion in annual sales. We urge collectors and investors to become knowledgeable and use common sense when buying,” said Steven R. Eichenbaum, NGC Chief Executive Officer.

“Some of the counterfeits are of extremely high quality, so if you don’t know rare coins, you’d better know your coin dealer. You should only buy from reputable and knowledgeable dealers who have a return policy with regard to non-genuine coins,” said Don Willis, President of the Professional Coin Grading Service.

In addition, there are reliable rare coin authentication companies whose certified coins are guaranteed for authenticity. Two such companies, among others, are Numismatic Guaranty Corporation (NGC) and Professional Coin Grading Service (PCGS).

For a copy of the informative booklet, What You Should Know Before You Buy Rare Coins, send $1 to the Professional Numismatists Guild, 3950 Concordia Lane, Fallbrook, CA 92028

Related posts:

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  3. Facts about Fakes
  4. EU proposes fighting fake euros with fakes
  5. Lost $3 Million Nickel Returns to Baltimore
  6. Coin Collecting: Do We Still Have a $20 Hobby ?
  7. Industry Leaders Comment on New PCGS Secure + Coin Grading Announcement
  8. The Philippine Numismatic And Antiquarian Society: “A Lost Legacy?”
  9. Stack’s Sells Millions in Baltimore!
  10. Lost or found? – UK’s Portable Antiquities Scheme

About the Author

The PNG is a nonprofit organization composed of the world's top rare coin and paper money experts. As numismatic professionals, our primary mission is to make the hobby safe for collectors and investors by maintaining rigid standards of excellence for our member dealers.

RSS Feed for This Post2 Comment(s)

  1. Samuel L. Lopresto | Oct 12, 2009 | Reply

    It is almost impossible to counterfeit the amount of coins coming out of China without the Chinese Government knowing about it. Also I have seen some that are of gem Quality and could not be mfg without HIGH TECH machines that only the Chinese government would be able to buy or help with. I have in the past years purchased HIGH TECH MACHINES, some as large as 40 thousands pounds and know what is needed for high quality items. If the US government does not require China to honor our US COPY LAW, then, of course, this will go on forever. Fakes are as old as history itself and only super powers can stop it if they desire to do so.

  2. Teri Davis Newman | Dec 26, 2009 | Reply

    China counterfeits everything because PEOPLE BUY THE FAKES! Look at the huge market for fake designer bags and that’s just a scratch on the surface. The people who buy these fakes are supporting the market for them.

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