The Chinese scammers are back after a brief hiatus. They are flooding social media with advertising for fake coins. I found three ads from these scammers offering American Silver Eagles for $9.95 on Facebook in the last two days.
As I type this, silver is $23.73 per troy ounce. It means that that the American Silver Eagle contains $23.73 worth of silver. Even with a modest numismatic premium of 5-percent (below the current market value), a silver bullion coin should cost around $25.00. A quick market survey shows that legitimate dealers are selling ungraded American Silver Eagles for $33-36 each. Coins with the Type 2 reverse are selling for $1-3 more.
Proof American Silver Eagles are more expensive because they cost more to purchase. If the U.S. Mint sells American Silver Eagle proof coins for $73.00 and dealers on the authorized purchase program receive a 5-percent discount, the wholesale price is $69.35 per coin.
Who would sell a proof coin less than the wholesale cost? If it is a genuine coin, then it is likely stolen merchandise. Otherwise, scammers are selling fakes.
Before you purchase these alleged “good deals,” please remember my five rules:
- NO LEGITIMATE DEALER IS SELLING BULLION COINS FOR BELOW THE SPOT PRICE!
- IF THE DEAL IS TOO GOOD TO BE TRUE, IT LIKELY IS NOT A GOOD DEAL!
- IF THE DEALER DOES NOT IDENTIFY THEMSELVES ON THEIR WEBSITE, THEY ARE LIKELY HIDING SOMETHING.
Check the “About” or “Contact” page. If there is no contact information, then they are hiding. If the address is in China or the Middle East, they will sell you counterfeit merchandise.
- IF THE SITE IS “POWERED BY SHOPLAZZA,” IT IS LIKELY A SCAMMER SITE.
According to contacts in the information security industry, the service is run by Chinese companies known to sell counterfeit merchandise.
- IF THERE ARE ANY QUESTIONS, THEN DON’T PURCHASE THE COINS!
Last year, I purchased two coins knowing they are counterfeit for educational purposes only. I used gift cards to purchase the coins to prevent exposing my credit card information. Both coins are made of nickel-plated steel and contain no silver.