Counterfeit Coins From China Raise Concern
United States coin collecting has been a popular hobby since at least the 1850’s. However, it’s not just people in this country who are seeking to fill US coin albums. Numismatists from all over the world actively compete against their American counterparts for the same coins. And why not? From the time the Mint was established in 1792, many US coins have built legacies that have persisted for generations. Beautiful designs, venerable histories, and plenty of rare dates of solid value have combined to attract an unusually large, diverse base of devotees to the hobby. In fact, U.S. numismatics is home to some of the most famous and valuable coins on the international stage.
Along with the good comes some bad. The sustained high prices for rare, popular dates and a vibrant market in which they trade have motivated counterfeiters to cash in on the popularity of U.S. coins. This is not a new occurrence. Back in the 1960’s and 1970’s, the coin collecting community feared for the worst as waves of counterfeits originating in the Middle East and elsewhere found their way into the hands of unwitting collectors. The damage was limited because most of the counterfeits were of such low quality fakery they were easily detected and expunged from the marketplace.
Everyone understands this fraudulent practice will forever be with us, but counterfeiting activity in China in recent years has elevated concerns to new heights. Not only has the number of Chinese counterfeits entering this county increased dramatically, their improved workmanship is making them a little harder to detect. They’ve also gone a step further by faking third-party grading service holders of some of the better known companies, including PCGS, NGC, and ANACS. Genuine coins with altered dates and mint marks are also on the rise and more sophisticated.
Despite the increased output of fake coins entering the United States, their overall number is still quite miniscule compared to the overall population of numismatic coins. As you might suspect, key dates of high collectible value are a primary target of counterfeiters, even to the point of matching metallic content, size, and weight. Another strategy is to strike fake designs onto brass blanks or some other low cost alloy, apply gold or silver plating, and pawn them off as precious metal coins.
The frontline defense collectors and dealers have is that despite improved counterfeiting methods, most fakes are still fairly easy to spot to the trained eye. Nearly all forgers fail to perfectly duplicate the finest details of genuine coins. Under magnification, subtle differences in the styling of numerals, lettering, and mint marks become obvious. It takes a lot of time, effort (and yes, skill) to be a good counterfeiter.
Apparently, most of these scoundrels are in such a big hurry to pocket their ill-begotten gains they get anxious and overlook crucial details in creating their reproductions. There are other telltale signals of debauchery, such as improper luster and artificially sharp reeded edges and rims. Over the years a number of fine reference books and courses have been developed to help you understand the diagnostics of genuine coins and detect counterfeits. It’s really not as difficult as you might think.
Chinese counterfeiters commonly distribute their wares through a network of cash-up-front distributors in the U.S. or other host countries. These accomplices understand they’re buying fakes soley intended to deceive, but their only real concern is to sell them into the marketplace as quickly as possible and reap profits. Many distributors operate on eBay and other online websites. Flea markets are another favored venue. Some unload their merchandise by slipping a few here and there into coin rolls or blend them into a large group of coins.
The continued influx of Chinese counterfeits has finally caught the attention of federal authorities. At Chicago O’Hare International Airport in April 2011, U.S. Customs and Border Protection (CBP) agents seized a package mailed from China containing 361 U.S. Trade Dollars purportedly minted between 1873 and 1878. All of them proved to be fakes. The “coins” were actually silver plated over brass, and were confirmed as counterfeits by a weight analysis and other testing. This was the first major intercept by the U.S. government of counterfeit coins entering the country from China. CBP has announced they’re now on the lookout for suspicious packages at international mailing facilities throughout the nation and will vigorously pursue individuals with the intent to distribute phony coins.
Counterfeit U.S. Trade Dollars intercepted by U.S. Customs and Border Protection agents at Chicago O’Hare International Airport in April 2011. The coins came from China, and are made of brass with a silver-plated exterior. The shipment was bound for an Illinois distributor, who told authorities he intended to sell them online. (U.S. Customs photo)
What protection does the average coin collector have from becoming a victim? As previously mentioned, you don’t need to be an absolute numismatic expert to learn how to spot fakes. There are guide books and other tools to show you the way. However, not everyone has the patience or confidence to become adept at sorting out fact from fiction. For those individuals, we recommend you buy expensive or precious metal coins only from coin dealers of solid reputation. Their teams of experienced buyers are seldom duped by counterfeiters, meaning you’ll probably get what you pay for.
Some commentators have gone so far as to speculate this latest round of counterfeiting craze has doomed the coin collecting hobby. Perhaps these is overstating the problem a bit, but let’s not fool ourselves, this is serious and has the potential to do permanent damage. Law enforcement must step up and do its job. We now see encouraging signs that may be causing those in the counterfeit rings to think twice before carrying out their devious schemes.
Here’s another thought for the counterfeiters to ponder: We, the core of the U.S. coin collecting industry, comprised of dealers, investors, and hobbyists, are now focused on you like a laser. At first, you had some success because you caught us off guard. No more. We’re informed and energized, so you might as well start searching for another line of work. We’ve been down this road before and survived, and we’ll do so again.
