The unprecedented exhibit marks the first time the complete set has been included in the PCGS Set RegistrySM. It also marks the fulfillment of a boyhood dream of the collector who owns the coins, Texas business executive Bob R. Simpson, Co-Chairman of the Texas Rangers baseball club.

“A total of nine off-metal World War II-era Lincoln cents from Mr. Simpson’s collection will be displayed at the PCGS booth (#102) at the FUN convention,” said Don Willis, President of PCGS, a division of Collectors Universe, Inc. (NASDAQ:). “There’s the unique set of three 1943 bronze-planchet cents, a set of three 1944 cents on zinc-coated steel planchets, and three wartime Lincoln cents erroneously struck on silver planchets apparently intended for the production of dimes.”

Simpson wanted to own a 1943 bronze cent error since he was a teenager, and now owns the only-known 1943-D bronze cent as well as other wrong-planchet, wartime cents. All will be exhibited at FUN.

Zinc-coated steel was used for producing cents in 1943 to conserve copper for other uses during World War II, but a small number of coins were mistakenly struck on bronze planchets left over from 1942. In 1944 the Mint resumed use of copper for cent production using recycled ammunition shell cases; however, a small number were mistakenly struck on zinc-coated steel planchets intended for use only on 1943-dated cents.

“Mr. Simpson is the first collector to ever assemble a complete P-D-S set of bronze-planchet 1943 Lincoln cents,” said Laura Sperber, President of Legend Numismatics. “When he recently saw all three coins together for the first time, he said, ‘This is incredible!’ Now, he’s graciously agreed to publicly display them.”

Sperber said that when he was a youngster, Simpson thought he’d actually found a 1943 copper cent in circulation. “But it was not authentic. He still has that in his desk drawer.”

The unique 1943-D bronze cent was purchased by Simpson in September for a record $1.7 million through Legend Numismatics after four years of negotiations with the coin’s anonymous former owner who donated all the proceeds to charity. It is the highest price ever paid for a United States cent.

“It was always special to buy each coin for this set, and until I had all the coins together I just did not realize how important and unreal this project really was! I’m as excited as any collector can be to see this amazing display,” Sperber said.

“Not only is Mr. Simpson’s Set of Off-Metal Cents the All-Time-Finest, it’s the absolute finest possible given the scarcity of the coins,” said BJ Searls, PCGS Set Registry Manager. “Photos of Mr. Simpson’s 1943 bronze and 1944 steel cents can be viewed online in the PCGS Set Registry for ‘Lincoln Cents Off-Metal Strikes, Circulation Strikes (1943-1944)’. The one-of-a-kind complete set has a weighted grade point average of 62.89.”

The coins and their PCGS Secure Plus grades are:
1943-P bronze, graded PCGS MS62BN
1943-D bronze, PCGS MS64BN
1943-S bronze, PCGS AU58BN
1944-P steel, PCGS MS64
1944-D steel, PCGS MS62
1944-S steel, PCGS MS66
1943-P struck on a silver planchet, PCGS AU50
1943-S silver planchet, PCGS AU58
1944-P silver planchet, PCGS AU53

A free, full-color, illustrated PCGS brochure about the coins in the exhibit, “One of a Kind: The Simpson Off-Metal Lincoln Cent Collection,” will be available while the supply lasts at the PCGS booth during the FUN convention.

Established in 2001, the PCGS Set Registry now hosts over 53,000 sets. For additional information about PCGS and its services, visit www.PCGS.com, call PCGS Customer Service at (800) 447-8848, or email info@PCGS.com.

Related posts:

1. Unique Bronze 1943-D Lincoln Cent Sold for $1.7 Million by Legend
2. 1943-S Lincoln Cent Struck in Bronze sold by Heritage for $207K
3. Previously Unaccounted 1943-S Bronze Cent Acquired by Rare Coin Wholesalers

A Weekly Column by Greg Reynolds

I explain the PCGS SecurePlus program in part 1. Here in part 2, Don Willis, the president of the PCGS, responds to the explanation that I put forth in part 1, and I argue, with assistance from expert dealers, that the PCGS SecurePlus™ program should be reformed, not by reformulating the program, but by preventing dealers from submitting rare coins through the old “standard” process. The positions of John Albanese, Ira Goldberg and Mark Feld are featured.

I devoted last Wednesday’s column to an explanation because I have found that many collectors and dealers do not really understand the PCGS SecurePlus™ program. For details of the PCGS SecurePlus™ program, and a discussion of its importance, please read part 1.

IV. Don Willis Responds

Don Willis has been the president of the PCGS since Oct. 2008. I knew him before then, when he was a coin dealer. Earlier, he had a very successful career in the field of information technology, including the founding of a large software company. I have found Don to be honest, willing to address controversial issues, and very concerned about the well being of collectors.

Willis graciously responds to the points put forth in last week’s column and to questions I asked. Fortunately, Don found my explanation last week as to how grading procedures under the SecurePlus program differ from standard PCGS procedures to be “correct.”

“Today, in its early stages,” Willis says, “SecurePlus is being driven by the collector community.” My (this writer’s) impression is that many collectors do not know or do not understand the benefits of the SecurePlus program. Moreover, not all collectors are familiar with the problems of grade-inflation and coin doctoring. Besides, the dealers who submit many coins to the PCGS are typically wholesalers, not dealers who sell directly to collectors. It would be illogical for the SecurePlus program to be steered by collector demands and collector feedback.

Willis continues, “We have seen many finest known and top quality sets submitted for SecurePlus grading.” I (this writer) find that this is certainly true. Several sets in the Simpson collection come to mind. “Most of these sets remain with their original owners and off the market,” Willis states. “One exception would be Dr. Steven Duckor’s set of Barber Half Dollars which were submitted through SecurePlus and later sold at auction for record breaking prices.”

Dr. Duckor is a strong supporter of the SecurePlus program. Please see his remarks in my June 2nd column. (As always, clickable links are in blue.) Further, I wrote two articles on Dr. Duckor’s halves (part 1, part 2). Also, I mention more of his halves in my column of Aug. 4th.

As Willis says, Duckor’s halves sold for extremely strong prices at auction and many auction records were then set. It is not clear, though, to what extent PCGS Secure holders (as opposed to regular PCGS holders) played a role in the prices realized. Dr. Duckor is one of the leading living collectors, and he is certainly one of the most sophisticated collectors of all time. For a Barber Half Dollar, or an early 20th century gold coin, a Duckor pedigree often adds considerable value.

The SecurePlus program should not only be for the benefit of those advanced, knowledgeable collectors who understand the program. “SecurePlus is only six months old,” Willis replies. “Currently all coins valued over $100,000 must go through SecurePlus. This will change in the future as the market dictates.” Willis figures that “the pace of SecurePlus submissions and the expansion of SecurePlus services will be determined by collector demand just as original PCGS submissions were back in 1986.”

I find fault with Don’s reasoning here. In the late 1980s, a very large percentage of PCGS certified coins were sold to investors or trading funds. It took time for collectors to be accepting of PCGS certified coins. Most collectors had to be persuaded; collectors were NOT then driving the demand for PCGS certified coins. There was a need then for the PCGS to aggressively market grading services. Now, more than 90% of all collectors of rare U.S. coins are accepting of the PCGS.

In the late 1980s and early 1990s, collectors were choosing between certified coins and not certified coins. This is different from choosing between PCGS certified coins in standard holders and those in ‘Secure’ holders. Much more explanation is required in regards to such a choice. Most collectors will never fully comprehend the importance of the technologies that underlie the SecurePlus program.

A very large percentage of PCGS submissions come from dealers, not collectors. There are dealers who engage in unethical or otherwise problematic practices relating to submissions to grading services. It is unrealistic to expect most collectors to be knowledgeable about the variables that relate to coin grading and submissions to the PCGS. Besides, it would be unreasonable to expect most dealers to tell collectors that coins in PCGS Secure holders are less likely to have been doctored than coins in standard PCGS holders. It makes more sense for the PCGS to expand the SecurePlus program now, for the benefit of collectors and the coin collecting community at large, as well as for the benefit of the PCGS itself.

V. Secure All PCGS Submissions?

John Albanese suggests that the PCGS mandate the SecurePlus program for all submissions of coins to be graded. “If they can solve the grade-inflation problem, they should use this [CoinAnalyzer] technology for all submissions, not just one tier.” Furthermore, Albanese declares that the PCGS “should use the sniffer for everything, not just for coins sent under one tier. Why discriminate for the benefit of the higher end coins? A $600 coin may be more dear to some collectors than a $100,000 coin is to others. It would not be fair for PCGS to only use this technology on expensive coins. I hope that they use it for all coins” that are submitted for PCGS grading. They should protect all coin collectors, not just wealthy collectors,” Albanese concludes.

Mark Feld puts forth a similar view. “I [Mark] hope that eventually, PCGS will use the scanner, the sniffer, and whatever else they have available, for each coin, regardless of the value.” Feld adds that, if the PCGS will not use these ‘Secure’ technologies on every single coin that is submitted to the PCGS, then these technologies should be used “on the vast majority of coins” submitted. “The current loophole, which allows submitters to use non-Secure options, severely diminishes the potential effectiveness and benefits of the SecurePlus tier. I [Mark] think that is most unfortunate, as I am vehemently against coin doctoring and its impact on the entire hobby and industry.”

Some information about Mark Feld’s qualifications and perspectives may be found in my column of Nov. 17. Feld clearly believes that the SecurePlus™ program is more successful at filtering doctored coins than the PCGS standard submission programs. Ira Goldberg agrees. Ira and his cousin, Larry, own a leading auction firm.

Ira finds that there are “very few doctored coins in PCGS Secure holders. They are tighter, and they have become too tough, calling genuine [and refusing to grade] a lot of coins that are perfectly fine to be graded.” Goldberg concludes that the PCGS SecurePlus program has resulted in “fewer errors in terms of grading doctored coins and more errors in rejecting coins that should be graded.” In my (this writer’s) opinion, it is much better to reject a coin that maybe should have been graded, and can always be graded at a later time, than to grade a coin that has been doctored. The PCGS grading of a doctored coin will result in at least one coin buyer being seriously hurt.

It is interesting that Feld and Albanese both suggest that the PCGS should require that all coins sent to the PCGS for grading be under the SecurePlus™ program. Similarly, Jeff Garrett is concerned that “the PCGS SecurePlus [program] is like a parallel grading service. I [Jeff] would have liked it better if all PCGS submissions were treated the same.” The two tiers are “a bit confusing for the public,” Garrett believes.

Ira Goldberg is largely in agreement with Albanese, Feld and Garrett. “Yes, all rare coins, not generics,” should be sent under the PCGS SecurePlus program, “if the fees are reasonable. It would be best for all” PCGS graded rare coins “to be in the Secure holders,” Goldberg states. “It would not make sense for common date Morgans or Double Eagles. For coins with much numismatic value, to fight grade-inflation and stop doctoring, it would be better if PCGS put all of them in Secure holders. It would be better if the fees were only a little higher than the current [standard] fees, less than the current SecurePlus fees,” Ira emphasizes. I (this writer) suggest that, if all submissions of rare coins to the PCGS were under the SecurePlus program, then the costs of the SecurePlus program could be averaged out over many more coins and thus the cost per coin (of the new technologies) would become substantially smaller over time.

Besides, it will be necessary to curtail grade-inflation, sooner or later. If more and more AU-55 and -58 grade coins receive MS-61 or MS-62 grades, and more and more previously 64 graded coins graduate to 65 or 66 grades, the system would then gradually lose credibility and may eventually collapse. Under the current two-tier PCGS submission system, dealers have an incentive to submit the same coins over and over again, to the detriment of the collectors who eventually buy doctored, mistakenly overgraded, or otherwise ‘low end’ coins.

Willis responds with the point that collectors may demand coins in Secure holders and not be concerned with those coins in other holders. I (this writer) find this point to be problematic. I care about discouraging the doctoring of all rare coins, not just the ones I may possibly own. Also, the values of coins in PCGS standard holders affect the values of coins in PCGS Secure holders.

Given the nature of markets in rare coins, it would be unusual for a PCGS graded MS-65 (or 65+) coin in a Secure holder to be worth more than a PCGS graded MS-66 coin, of the same type and date, in a standard holder. Under the two-tier PCGS submission system, dealers have an incentive to crackout many 65 grade coins and re-submit them to the PCGS with the aim of getting a 66 grade. If the PCGS required all rare coins to be submitted under the SecurePlus program, upgrades would still occur, but upgrades would be much less frequent. There would be a marked increase in grading stability, which benefits most all collectors.

It is not beneficial to the coin collecting community that there are wholesalers, including some leading grading experts, who spend most of their time cracking coins out of holders for the purpose of re-submitting the same coins over and over again. One expert dealer recently told me that he spends around $25,000 per month on grading fees and eighty percent of his income stems from “getting upgrades.”

“The market works like a perfect machine, just follow the money,” Willis publicly declares. This is not true. In economics courses, students learn that markets only work perfectly in theory, when all buyers and sellers have total knowledge, in the present and of the future, regarding the goods and services being transacted. It is just impossible for most collectors to fully understand grade-inflation and coin doctoring, and most collectors will not become expert graders. Besides, most dealers, even those with the best of intentions, are never going to be both WILLING AND ABLE to explain the PCGS SecurePlus program to collector-buyers. Indeed, it required numerous words here, and in last week’s column, for me to explain and suggest reform of the PCGS SecurePlus program.

VI. The Future of SecurePlus

The problems of grade-inflation and coin doctoring are very damaging and, if unchecked, will severely harm the coin business. I strongly believe that both problems are containable, and the SecurePlus program can play a central role in containing them.

Of course, I realize that David Hall and Don Willis are very much aware of these problems and I applaud their efforts in 2010 to address them. They have done more to address these problems than I thought officials at either of the two leading grading services ever would. Richard Haddock also deserves credit for developing and implementing the CoinAnalyzer brand, coin scanning and identification technology. The importance and potential of coin identification and ‘coin sniffer’ technologies cannot be overstated.

“At the upcoming FUN show in January,” Willis informs, leaders of the “PCGS will be making several very important announcements relating to SecurePlus at the PCGS Registry luncheon on Friday,” Jan. 7, 2011. “Those who will be attending the Registry luncheon will see the latest innovations to combat coin doctoring and counterfeiting, which will only be available through the SecurePlus” program,” Willis adds.

I thank Don for inviting me to attend. I hope that at least one of these announcements will lead to a shift in PCGS submissions from standard to SecurePlus. The value of each rare coin in a PCGS Secure holder, and the success of the whole program, is positively correlated with the number of other rare coins in PCGS Secure holders and with the relative importance of the other such coins.

The management of the PCGS should choose to make less profit in the short run by lowering fees and applying these new technologies to most all submissions of scarce or rare coins; I predict that the PCGS would then be much more profitable over the long run. It is fair to suggest that coin collectors and the PCGS would then benefit more and more from the SecurePlus program, as time passes. Also, I hope that the NGC adopts scanning and sniffing technologies as well.

©2010 Greg Reynolds

Related posts:

1. Coin Rarities & Related Topics: The PCGS SecurePlus Program, Part 1: An Explanation
2. Coin Rarities & Related Topics: Upcoming LB Auctions, PCGS Secure Plus & NGC Metallurgic Analysis
3. Coin Rarities & Related Topics: The PCGS Lawsuit Against Alleged Coin Doctors

A Weekly Column by Greg Reynolds

On March 25, 2010, David Hall and Don Willis, the top officials at the Professional Coin Grading Service (PCGS), announced and explained the PCGS SecurePlus™ program, known for weeks before as “The Big One”! For most grades between EF-45 and MS-68 inclusive, the PCGS begin assigning plus grades when warranted, such as 45+ or 63+. As the rival of the PCGS, the NGC, incorporated plus grades into their system two months afterwards, and the PCGS later allowed for standard submissions to be eligible for plus grades, not just coins submitted via the SecurePlus tier, plus grades now seem to be a secondary aspect of the program. In my view, the emphasis should always have been, as it is now, on the ‘Secure’ aspects of the SecurePlus program, which are truly revolutionary and have tremendous implications for the future of markets in rare coins.

I hope that those who are not entirely familiar with the PCGS SecurePlus program find this column (part 1) to be very clear and educational. In my opinion, the explanation of the PCGS SecurePlus program on the PCGS website is not extremely clear and, over the past six months, I have found that many collectors are confused about this program.

Collectors who are already very familiar with the PCGS SecurePlus program, and with PCGS policies in general, may wish to wait for part 2, next week. In part 2, Don Willis, the president of PCGS, responds to my explanation and a proposal for the reform of PCGS submission policies is put forth. The views of John Albanese, Mark Feld and Ira Goldberg are included.

In the first section, I provide a definition of the SecurePlus program. In the second section, I explain the benefits of the coin identification part of the SecurePlus program. In Section III, I emphasize that submitters of coins to be graded by the PCGS may choose between the SecurePlus program and standard submission options.

I. The PCGS SecurePlus Program

The SecurePlus program brings three new technologies to coin grading. (1) The introduction of a new technology for scanning and coin identification, through the use of CoinAnalyzer devices that are produced by Richard Haddock’s CoinSecure firm. An image and data from each scanned coin is entered into a database, and, if the same coin is scanned at the PCGS in the future, it will be identified as a coin that was previously scanned.

(2) The use of ‘Sniffer’ technology to detect added foreign substances and changes in the surfaces, the metal, on coins that have been deliberately harmed by coin doctors for the purpose of deceiving experts and others into believing that doctored coins merit higher grades than were (or would have been) assigned before such coins are doctored. Additionally, the adding of metal to the surfaces and/or the deliberate heating of the metal on the surfaces of a coin will, hopefully, be detectable by ‘coin sniffer’ technology as well. The PCGS has already begun using ’sniffer’ technology to an extent, and will be phasing additional sniffer applications into the PCGS SecurePlus grading program over time. I will devote a future piece to coin sniffer technology. The subject is so complicated that it must really be treated in a long article.

To gain some understanding of coin doctoring and the urgent need to contain the coin doctoring problem, please read five previous pieces of mine. Last year, I devoted a series of three articles to the reasons why naturally toned coins are preferred and the topic of coin doctoring is discussed at length therein (part 1, part 2 and part 3). This year, I wrote two columns that address the PCGS lawsuit against alleged coin doctors, on June 3rd and on Sept. 8th. In these two columns, coin doctoring is defined, the lawsuit is analyzed, and the seriousness of the matter is emphasized.

(3) The third ‘Security’ issue relating to the PCGS SecurePlus program is the anti-counterfeiting technology incorporated into the new inserts. In each PCGS holder, there is a paper insert that provides information about the coin contained therein. A gold eagle with a shield is pictured on an insert in the PCGS holder that houses each coin that has been graded under the PCGS SecurePlus program. Unethical businesses in China have produced forgeries of PCGS holders with misleading grades printed on fake inserts. New anti-counterfeiting features are important, though less so than the coin identification and sniffer technologies that constitute the core of the PCGS SecurePlus program.

II. Coin Identification: An Explanation

Under the SecurePlus™ program, submitted coins are scanned, for purposes of identification, with CoinAnalyzer devices. CoinSecure software employed by the PCGS will be able to identify each scanned coin if it is submitted to the PCGS again in the future, and, when a match is found, the submitted coin will be closely compared to an image of the same coin that was taken when it was previously submitted.

Video Caption: David Lisot, Executive Producer of Coin Television has put together a montage of comments from industry leaders following the PCGS announcement of its New Secure + coin grading service

My understanding is that, when the Finalizer of a submitted coin finds, through CoinSecure software, that it has been previously submitted to the PCGS, he will analyze the images and, if the appearance of a matched coin has changed, the Finalizer will investigate the reasons why it has changed. Not all changes in the appearance of a coin are due to coin doctoring or accidental mishandling. Most coins naturally and gradually tone over time.

When PCGS graders evaluate a coin that is submitted under the PCGS SecurePlus program, they are not, at least not at first, told whether or not it has previously been submitted to the PCGS. After graders grade a particular coin, the Finalizer examines the coin and reviews the grades assigned by two or more graders.

If a coin is scanned by a CoinSecure CoinAnalyzer device and is later scanned again, software developed by Richard Haddock’s CoinSecure firm can, with access to data from both scans, certainly match the two sets of data as belonging to the same coin. Indeed, in extensive testing of the matching feature of the CoinAnalyzer devices and accompanying software, Richard Haddock and Don Willis found that previously scanned coins were definitively identified in “100%” of all cases. “Short of destroying the coin,” Don Willis says, it will be identified if it was previously submitted under the SecurePlus program. For test purposes, Willis and associates dipped, doctored or even severely damaged a very large number of coins and found that each of them could later be matched to images taken before the test coins were modified. In another words, regardless of the extent to which a coin is changed (within reason), a pre-change scan can be definitively matched to a post-change scan, say Haddock and Willis.

The CoinAnalyzer devices, and accompanying software, are thus useful for identifying coins that have been previously submitted and for providing clues regarding each coin that looks different now than it did at an earlier time. For a coin that has changed, by comparing ‘before’ and ‘after’ images, a PCGS Finalizer will get an idea of the manner in which the coin changed. If an area of a coin that was previously gray is now blue (or vice versa), the Finalizer and/or the graders will (I hope) closely inspect that particular area.

The CoinAnalyzer devices, as employed in the PCGS SecurePlus program, may also be useful in terms of identifying coins that have previously been lost or stolen. If coins certified under the PCGS SecurePlus program are stolen, the rightful owner should notify the PCGS of the theft. If such stolen coins are later submitted to the PCGS, they may be identified. Moreover, in many situations, the rightful owner or law enforcement authorities may suspect that such stolen coins have appeared somewhere else, perhaps not in PCGS holders. If the suspect coins are scanned with a CoinAnalyzer device and officials at the PCGS cooperate, then it can be determined if the suspect coins were ever submitted to the PCGS under the SecurePlus program.

The Secure in SecurePlus does not exactly mean that each grade assigned is secured in the sense that a foundation secures a house. Many collectors and dealers have wrongly concluded that the PCGS assigned grade of a coin, which is certified under the PCGS SecurePlus program, can never change; it cannot be regraded. This is not true. The grade is “guaranteed,” as are all PCGS assigned grades, relating to all submission programs, in that, if experts at the PCGS determine that a coin was earlier overgraded by the PCGS, the PCGS will then offer to compensate the owner for a reduction in the grade of a coin or offer to buy the coin at a PCGS determined price that is commensurate with the earlier grade that the PCGS later determined is too high.

A coin that was previously graded X by the PCGS under the SecurePlus program may later be graded higher than X by the PCGS under the SecurePlus program. Don Willis emphasizes that the PCGS SecurePlus program is designed to prevent a coin from being upgraded “for the wrong reasons.” Willis, the PCGS president, acknowledges that sometimes the PCGS mistakenly undergrades a coin and thus will later increase its grade.

When the Finalizer approves the grade of a coin that was previously submitted to the SecurePlus program, he has much additional information to factor into his decision-making process. He will be aware of the previous grade that was assigned by the PCGS to the same coin and he will be able to see, by comparing earlier and current images, if the appearance of the coin has significantly changed since it was earlier submitted. Such additional information should dramatically reduce the probability of a recently doctored coin being graded and should lessen the likelihood of a coin being upgraded or downgraded. It should lead to more stability in the grading process.

It is not unusual for the same rare coin to be re-submitted to the PCGS and/or the NGC on multiple occasions. In a large number of cases, the same submitter will send in the same coin many times in hopes of a higher grade. In other cases, subsequent owners of the same coin will send it in again, often without knowing how many times it was previously submitted by others.

I believe that dealers will be less likely to ‘crack’ coins out of PCGS Secure holders as the probability of getting an upgrade, especially an undeserved upgrade, will be much lower. Part of the point of the ‘crackout’ game is that submitters hope that graders will eventually mistakenly overgrade a coin, which financially benefits the dealer-submitter. The use of the scans from CoinAnalyzer devices will greatly enable PCGS Finalizers to lessen the likelihood of such mistakes occurring. When a coin that would otherwise be upgraded (if not submitted under SecurePlus) is identified as having previously been assigned a lower grade, the Finalizer will further investigate the coin in question and give thought to whether it is truly deserving of an upgrade. Under the SecurePlus program, many mistakes will be caught before such mistakes result in overgraded coins being certified and shipped.

III. The Two Tiers

For coins valued from under $100,000 each, a PCGS submitter may choose to submit under the “standard” program, as submissions were before March 2010, when the SecurePlus program was inaugurated. Presumably, coins submitted under the standard program will not be scanned and will not be sniffed. Also, comments from PCGS officials suggest that coins submitted under the SecurePlus program have been subject to more scrutiny from human experts at the PCGS.

The differences in fees between the standard submissions and the SecurePlus submissions are substantial. For typical (“regular”) submissions of coins valued at $3000 or less, the standard fee is $30 per coin and the SecurePlus fee is $45 per coin, 50% more. For coins valued up to $20,000, the difference is not as large, the Express Standard fee is $50 and the Express SecurePlus fee is $65 per coin, 30% more. Click here to see the PCGS list of submission fees.

Coins that are already certified by the PCGS may be moved into SecurePlus holders, after being scanned and sniffed, for a “reholder” fee of only $20 per coin for coins valued at up to $20,000 each. My understanding is that the sniffing technology is being implemented in stages will not be fully operational until some point in 2011, and that SecurePlus submission are subject to more human scrutiny than regular submissions. Don Willis explicitly refers to “additional screening” in regard to coins submitted for reholdering under the SecurePlus program.

From the beginning in March, I and many others have found this two tier system to be upsetting and problematic. Of course, I realize that the PCGS spent a large sum of money to adapt the CoinSecure firm’s CoinAnalyzer technology for its own purposes and will be paying the CoinSecure firm. Furthermore, the PCGS has probably spent a fortune on developing ‘Coin Sniffer’ technology. Moreover, SecurePlus submissions require more time and care from employees of the PCGS. Even so, in my view, these are all necessary and well justified expenses for the PCGS to develop and offer a better product for coin collectors and other coin buyers. When a firm spends a fortune to develop a superior product, it is not always logical to continue to offer the inferior (though still very good) product that is being replaced, especially when dealer-customers stand to gain financially from the inferior-product, at the expense of collectors.

While the PCGS gains in the short run from the resubmission of the same coins many times, both the PCGS and collectors are harmed by this practice in the long run, or even in the medium-length run. Grade-inflation diminishes the value of the services offered by grading services and discourages people from collecting coins. Moreover, as explained above, coin doctors are much more likely to deceive PCGS experts with coins that are submitted under the standard program than under the SecurePlus program. If most or all submission to the PCGS were under the SecurePlus program, then the grading services that PCGS offers would become much more valuable. Put differently, the SecurePlus program would be much more valuable if it became the sole program not an option along with the old standard holder program.

Under the current PCGS policies, dealers may keep cracking coins out of holders and submitting them under the PCGS standard program. If a coin was previously graded MS-65 nine times and, on the tenth submission, is graded MS-66, then only the submitter (or no one) will ever know that it was graded MS-65 nine times. Three different dealers may each have submitted it three times before someone got lucky with a MS-66 grade. Even worse, putty, gel, film or paste may be added to cover imperfections for the purpose of deceiving expert graders at the PCGS into believing that a previously MS-65 graded coin is now worthy of a MS-66 or -67 grade, even though such a doctored coin should not receive a grade at all.

Coins in PCGS Secure holders are not yet selling at large premiums, on average, over coins in PCGS standard holders, and coins in PCGS Secure holders are still not often found, even after more than six months. Premiums for PCGS Secure holders are small, on average, largely because most coin collectors and other coin consumers do not understand how the PCGS SecurePlus program benefits individual certified coins and the coin collecting community at large. Curtailing grade-inflation and minimizing the number of doctored coins that are graded are tremendous goals that would, if successfully reached, be of great benefit to coin buyers.

In part 2, Don Willis responds, a proposal for reform of PCGS policies is put forth, and the views of John Albanese, Mark Feld and Ira Goldberg are included.

©2010 Greg Reynolds

Related posts:

1. Coin Rarities & Related Topics: The PCGS SecurePlus Program, Part 2: Reform
2. Coin Rarities & Related Topics: Upcoming LB Auctions, PCGS Secure Plus & NGC Metallurgic Analysis
3. Coin Rarities & Related Topics: The PCGS Lawsuit Against Alleged Coin Doctors

The Simpson dimes were being broken up. [ Heritage Long Beach Sale #1144] This would be a great opportunity to upgrade dimes in an advanced Seated Dime collection. The big problem was there were so many coins that few buyers would be able to purchase them all and no one did surface who did. Even more amazing are some of the coins left in the collection like a MS66 1844 Dime. Legend (Numismatics) has made available to me so many wonderful dimes that news of this sale created euphoria.

It would come as no surprise that most of the coins were either crossed over to PCGS at the same or in many cases a lower grade. Seeing the secure plus holders and Simpson pedigree would make this obvious. There was a lot bidding research needed prior to bidding. There were cases where buying too many coins early would limit the ability to chase coins later. One the highlights of the sale being a simply gorgeous 1872-S, I was not the only one to think so as the coin went to the moon.

One of my regrets of the sale was not being able to purchase the 1845-O dime in mint state. This is a very rare opportunity indeed but as a rule if you set a maximum bid and exceed it by 10% you have to know to stop. Being the under bidder was really not satisfying and maybe a higher bid was warranted. Another highlight of the sale was a gem 1860-S. Prior to the sale, Laura (of Legend Numismatics) and I spoke as to where the coin would sell. It was another on my short list. I think we both underestimated the demand for this coin. It went far over preauction estimates but I don’t doubt it to be well worth the hammer price $40,250. A nice return on investment considering one sold for roughly $7,000 in 1994.

One of the interesting notes about these coins is how many were not picked up by Seated Dime registry collectors but rather a just collectors and dealers. I know one dealer picked up roughly 10% of the coins and most all have been sold. There were many bargains in this sale too. Mostly the coins following the Simpson dimes went too cheap. One example is an 1858-O is a MS64 PCGS holder population 1 with 8 finer sold for just under $3,000 while the Simpson PCGS MS65 population 7 with one finer soared to $9,200. With the grade covered it was not really possible to call either coin much better than the other.

Some of the real steals in the Simpson collection came in the coins in NGC holders. The obvious assumption is these are coins that on a given day did not cross over at PCGS. A good many of them did regrade at NGC. In the case of the ultra-rare 1853-O MS64 the coin was simply overgraded. The coin did have a wonderful and original look to it but just had too many marks to be graded higher than MS62 in my opinion. The coin could easily be traced back with little effort to its previous holder. In general the ultra high grade trophy coins were the ones hitting the moon. Clearly one of two mint state 1845-O Dimes should be worth more than a other coins that sold in the low $20,000’s. This was a sale where knowledge was king.

The extreme rarity of the 1863 Dime in Gem Mint state is grossly under-rated. Some of the seven graded PCGS MS65 coins were the same coin in an attempt for an upgrade. I have been able to locate a sole PCGS MS66 and this MS65 in all auction results.

The finest coin ever sold in any Heritage sale ever was this MS65, the only other PCGS coin to sell in UNC was a lone MS63. With only one MS65 being auctioned it becomes very doubtful that there are six other MS65 coins out there. Just two PCGS Uncirculated coins ever sold by Heritage, the NGC coins are seemingly more available but there is at least two coins that should be proofs graded MS by NGC. Seeing there are the same dies used this becomes something of a judgment call but if a coin is fully prooflike, full struck, highly reflective and a full wire rim I believe PCGS would call these proofs.

Many business strikes seem to lack some of the details of the fully struck proofs. Any way you look at it, Gem 1863 dimes are very few are far between. Another amazing rarity is the 1851-O that sold cheap in NGC MS64, PCGS does not even list a price in grades higher than MS64 which is $4500.

According to CoinFacts, the finest known is a NGC MS65 followed by a sole PCGS MS64 and the lone NGC MS64 coin auctioned off in the Simpson sale (NGC lists the population as two but it appears to be the same coin), followed by the NGC MS63. There is a lone PCGS MS62 and NGC. Why these coins remain so cheap compared to the San Francisco of the 1850’s is something; when others figure out could result in a significant increase in price. All it takes is one or two people trying to find a Mint State example to drive the prices up on these substantially. Neither the number 1 or 2 PCGS sets have a mint state example of this date. The NGC registry shows the number 1 set with a MS65 followed by a MS63 in the #2 set.

While many of the coins in the Simpson set were among the finest known, this set was also assembled in a fairly short period of time. The cream of the crop really did go the moon but ultimately the coins sold themselves. They generally sold for more money than would have been estimated prior to the sale. The NGC coins sold a tad on the weak side and a few of the rarer New Orleans coins sold too cheap, even factoring in a downgrade at PCGS. The prices for Seated Dimes posted on PCGS values show many have been dramatically increased.

The “top-pop” coins were extremely strong showing that even if a coin is very rare in MS62-64 a coin of comparable rarity will bring far more if its grade is MS65 or better.

While in the end I did not get many of the coins I had hoped to, still it would be hard to complain with the coins I did. It was a wonderful event from start to finish.

Related posts:

1. The Finest $10 Indian Head Eagle Gold Coin Registry Set: The Simpson Collection
2. 1802 Half Dime Rarity to Be Offered in Cincinnati by Heritage
3. Learning from the Simpson Collection

After two+ years of being traded on the open market, I think few collectors and dealers would argue the statement that CAC stickering has added considerable value and liquidity to many types of United States gold coinage. But are we now able to determine with a decent degree of accuracy which coins are most affected by a CAC (or the absence of a sticker)? Let’s take a look at some areas of the gold coin market and see how CAC is adding value.

One of the areas that CAC has added the greatest amount of value is in the St. Gaudens double eagle market. The impact is seen two ways. The first is with common “generic” issues in MS65 and MS66. One of the main reasons why the premium for non-CAC certified MS65 Saints is so low when compared to MS64 coins is that most of the coins in MS65 holders are not significantly better than those graded MS64.

What CAC has done is to identify those coins graded MS65 that are nice quality and which are “real” 65’s. Currently, non-CAC Saints in MS65 trade for around $2,300. Those with CAC stickers are worth at least 10-15% more. They are also quite liquid and can be sold even when dealers have extensive numbers of non-CAC coins in stock. Non-CAC MS66 Saints are currently worth around $2,750-2,850 per coin. The premium for MS66 Saints with CAC stickers is at least $750-1,000 per coin. Given the fact that the stickered MS66 coins I have seen are very nice (as compared with the non-stickered coins which range from inferior for the grade to decent) this premium makes sense.

Another area where CAC stickered coins are selling for a significant premium is in the better date Saint market. Let me pick a random issue: the 1927-S in MS64. This coin has a current bid of $70,000 in this grade and a bona-fide Gem is worth double this. The quality of 1927-S double eagles varies greatly and there are coins that are very low end and hard to sell for $55,000 and coins that are very high end and worth over bid. I can’t recall having ever seen a 1927-S in MS64 with a CAC sticker but if I had a PCGS/CAC coin that I liked I’d quote $75,000+.

Early gold (i.e. gold coins struck from 1795 to 1834) is area that has shown itself to be influenced by CAC stickers. I don’t like every single piece of CAC-stickered early gold that I see but I like at least 90% of the coins. Compare this to non-CAC early gold where probably 50-60% (or more) of the coins offered at auction or through dealer’s websites are not, in my opinion, nice for the grade. I find this to be especially true with early gold in the MS63 and MS64 grades. As an example, an 1812 half eagle in MS64 with a CAC sticker is currently worth around $40,000. The same coin in the same grade that is not stickered and which is not a CAC-quality coin, in my opinion, might be hard to sell for $32,500. More and more collectors of coins like this are demanding that they be CAC stickered and the premium for the pieces that have the Green Bean is at least 10-15% and climbing.

Because so many Proof gold coins have been doctored over the years, CAC-stickered pieces are currently garnering high premiums. This is more so with Matte Proofs than Brilliant Proofs. I can’t remember seeing more than a few Matte Proof gold coins in the last two years that weren’t doctored to the point that they weren’t even the right color. When the few remaining fresh pieces come onto the market, they realize strong prices. As an example, Stack’s just sold at auction a lovely 1913 Matte Proof gold set. All four coins were CAC stickered and all four brought exceptional prices. I see similarly graded washed-out NGC Matte Proof gold from time to time and it brings Greysheet prices or lower; these superb, vibrant Gems brought numbers that were way over “sheet.”

I’ve found CAC to be very particular when it comes to Brilliant Proof gold as well. Lower grade (PR63 and below) Proofs aren’t really impacted by having or not having having CAC stickers unless they are a very rare early date issue. In this case, the premium seems to be around 10%. The real premium is for very high grade pieces. As an example, from time to time, a really remarkable PR68 or PR69 Liberty Head quarter eagle will become available. While these coins tend to be pretty amazing from a visual standpoint, very few are CAC approved. I believe that a PR68 or PR69 gold coin with a CAC would sell for a very significant premium; maybe 20-30%.

There is no doubt in my mind that CAC has greatly improved the value and liquidity of nice NGC coins. As someone who sells a good number of NGC coins, I’ve noticed that pieces that have CAC stickers are regarded as being just about as “good” to collectors as PCGS coins; unless the collector is working on a PCGS-only Registry Set and will not purchase any coins at all in NGC holders. In the collector marketplace, the current hierarchy for many series of US gold coins is as follows:

1. PCGS coins with CAC stickers
2. NGC coins with CAC stickers
3. PCGS coins without CAC stickers
4. NGC coins without CAC stickers

A major exception to this rule is rarity. If a coin is a very rare date (say an 1883-O eagle or an 1842-C Small Date half eagle), collectors are still concerned first and foremost with the coin itself and not the plastic.

Another exception is the popularity of the series and who the end users are. Certain series, like three dollar gold pieces, are just not popular enough right now that CAC stickers make all that much of a difference from a price standpoint. Other series, like Type Three Liberty Head double eagles and Indian Head quarter eagles, are sold mainly by marketers who do not “preach the gospel” of CAC and, therefore, the current market premium is not as great as in other series.

It has been interesting to view the market acceptance of CAC in the last two years. The market has gone from being initially cynical (and in some cases hostile) to being accepting to, in some cases, fully embracing CAC. This has been most clear in the premiums paid for CAC coins and I think we’ll see these premiums continue and, in many cases, increase as demand grows in the coming years for the highest quality rare coins

Related posts:

1. Why Don’t More People Collect 20th Century U.S. Gold Coins by Date?
2. San Francisco Double Eagles Gold Coins: A Date by Date Analysis Part Two
3. Proof-Only Gold Coins