Although I may take issue on occasion with third-party coin grading companies, including top-rated PCGS and NGC, they and the other top-tier services (ANACS and ICG) are essential when you think you may have purchased a counterfeit coin.
Counterfeits are growing increasingly common in estate and online auctions, especially through portals such as Proxibid, iCollector and eBay, which feature hundreds of rare-coin auctions every day (if not every hour).
I’m an experienced numismatist who knows counterfeiting basics, but often those are insufficient when you cannot inspect a coin close-up. Moreover, when auctioneers state that all sales are final, you had better approach them with proof that the coin you won is a fake.
That’s when third-party graders can help your case.
You’ll have to prove that case within 45 days if you purchased a coin on eBay using PayPal. I confronted that policy when I submitted a medieval gold piece through my local dealer to NGC. Dealers typically wait until they have at least five coins to submit. That can take a few weeks. Then add the usual 30-day turn-around time, and it’s easy to surpass the eBay/PayPal limit.
So PayPal was no help in refunding my purchase.
Luckily in this case, the seller offered to pay the difference between the gold weight and the final sale.
Since that transaction, though, I do not buy many rare coins, especially gold, from eBay unless they come in third-party holders (and even those can be fake, but rarely so).
My latest counterfeit purchase happened in a recent Proxibid auction conducted by a dealer in my home state of Iowa.
The issue with this particular coin, a $2.50 Indian gold piece, was difficult to detect via the Web. I questioned its authenticity as soon as I inspected it first-hand and then brought it to my local coin shop owner, Scott Nichols, who immediately sensed a problem, too. “There’s something wrong with the incuse,” he said, a clue that coin was a fake.
“Incuse” is a device, or image, that is minted into and below the surface of a coin, the opposite of “relief,” which is above the surface.
We sent it to NGC, and it came back as “not genuine.”
The coin appeared to be a 1960s-type Lebanese rather than Chinese fake, and it actually contained a few more grains of gold than the standard 64.5 grains of authentic strikes.
Fortunately, I knew the auctioneers who have promised a refund, including shipping.
Counterfeit detection is a skill that anyone bidding online or buying raw coins in person should learn. There are several books on the topic. My favorite is The Official Guide to Coin Grading and Counterfeit Detection, second edition, published by PCGS.