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Dec 292013
 

Counterfeiting coins and currency has been a problem for both the government and the numismatic industry. Government has shown it will go to extensive lengths in order to change the $100 note in order to stop currency counterfeiting. In fact, currency has had a long history of trying to fight currency counterfeiting.

For collectors of United States coins, there is a problems with the counterfeiting of classic coins primarily from China. In China, it is legal to reproduce obsolete

An example of a Morgan Dollar cut in half to match a date with a mintmark to have the coin appear something it is not. Coin was in a counterfeit PCGS slab and caught by one of their graders.

An example of a Morgan Dollar cut in half to match a date with a mintmark to have the coin appear something it is not. Coin was in a counterfeit PCGS slab and caught by one of their graders.

foreign coins. The thought is that the coins are obsolete and would not be accepted in commerce. However, when one of these “entrepreneurs” creates a fake coin that mimics a valuable rare variety, that causes a problem amongst collectors.

Those who create counterfeit coins are not making “tributes,” as has been the stance of the Chinese government. They are reproducing rarities and trying to pass them as real coins. In some cases, these counterfeiters are even trying reproduce the third-party grading service slabs in order to get them past scrutiny.

In the United States, Industry Council for Tangible Assets and the Gold & Silver Political Action Committee has been working to have congress update the Hobby Protection Act (15 U.S.C §§ 2101-2106) to provide for more protection to the buyer. Aside from strengthening the requirement to have copies appropriately marked and marketed, it allows for duped buyers and the government to take action against the resellers. Currently, the Hobby Protection Act only allows for action against the manufacturers and not anyone else in the supply chain. By opening the supply chain to prosecution it is hoped that it will choke off the supply.

This past August, the House of Representatives passed the Collectible Coin Protection Act on a unanimous voice vote.

PCGS representatives showed Congressmen counterfeit U.S. coins in counterfeit PCGS holders during their recent meetings in Washington, DC.  (Photo courtesy of PCGS.)

PCGS representatives showed Congressmen counterfeit U.S. coins in counterfeit PCGS holders during their recent meetings in Washington, DC. (Photo courtesy of PCGS.)

The bill, H.R.2754, has been referred to the Senate and is currently waiting for action in the Commerce, Science & Transportation Committee. To support the law, to to senate.gov and use the pull down menu in the upper-right corner of the page to select the state you live or work. Please take the time to contact both of your senators. In fact, if they hold town hall meetings in your area, you can use that opportunity to talk with them personally.

Collectible coins are not the only problem. Great Britain has been having problems since the issue of new £1 coins entering circulation starting in 2010. Even though arrests have been made, there remains an undetermined amount of counterfeit coins in circulation.

Last summer, counterfeiters were arrested in Greece and Turkey for producing fake 2 Euro coins. These counterfeits look very similar to the standard 2 Euro coin with the standard Greece reverse. A real 2 Euro coin is a bi-metalic coin that does not separate. The counterfeits will separate and are lighter than the real version.

In Canada, the Royal Canadian Mint has changed the Loonie and Toonie to include micro engraving to thwart counterfeiters. The RCM has also changed the composition of the coins which will help them last longer.

Counterfeit coins and currency will continue to be a problem. Every change, no matter how small, is not only good for the economy, it is good for the hobby.

Images of the new Loonie and Toonie courtesy of the Royal Canadian Mint.
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  One Response to “Counting Down the Top 10: #3 Fighting Counterfeits”

  1. […] continues the countdown of the top numismatic stories of the year with #4 organizational changes, #3 fighting counterfeits, and #2 broken […]

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