I sold a counterfeit coin. What do I do?

greghansen · April 26, 2005 11:00AM

In Jan. 2005 I sold a PCGS VG8 1902-Micro O Morgan Dollar. At the time believed to be a rare and desirable variety. Here is the EBAY auction listing:

My Jan. 2005 1902-Micro O auction listing

Yesterday, PCGS declares this coin and many of its bretheren to be a counterfeit. The article is discussed in another thread here, but this is the direct link to the PCGS article.

PCGS Article declaring coin to be a counterfeit.

My question is...what should I do with regard to the Jan. 2005 sale?

MICHAELDIXON · April 26, 2005 11:03AM

My question is...what should I do with regard to the Jan. sale?
.
Stand behind your merchandise and provide a full refund. Then send the coin to PCGS under their guarantee.

skingspan · April 26, 2005 11:03AM

Doesn't pcgs have some kind of a guarantee?

7summits · April 26, 2005 11:04AM

I'd say you do nothing - PCGS, after all, did authenticate the coin. Sounds like their problem. The buyer can take it up with them.

MICHAELDIXON · April 26, 2005 11:05AM

This was meant to be an edit of my original post.

cosmicdebris · April 26, 2005 11:05AM

<< I'd say you do nothing - PCGS, after all, did authenticate the coin. Sounds like their problem. The buyer can take it up with them. >>

XpipedreamR · April 26, 2005 11:07AM

I'd tell the buyer, and refund the $$$, and return it if you want, or let him return it to PCGS if he wants.

Wolf359 · April 26, 2005 11:07AM

Michael is correct. I'd contact the buyer and offer a refund. The rest is up to him/her.

greghansen · April 26, 2005 11:09AM

Doesn't pcgs have some kind of a guarantee?

PCGS does have a Grading Guarantee and their article announcing their finding makes very clear that those who wish to turn their coins in, will be reimbursed at what they determine to be the fair market value.

I have not been contacted by the buyer...I have no idea if the buyer is even aware of this finding by PCGS yet. I didn't know anything about it until reading the other thread on the board. I will be notifiying him/her in the very near future, however, and would like to have a plan of action in mind when I contact them. Never had this one happen to me before.

Wekar · April 26, 2005 11:10AM

If I were you, I would be a nice person and try to contact the buyer with a link to that article, let them know they can send the coin back to PCGS, maybe they'll get more money than they bought it for, but they may still want to keep it as is. Don't feel the need to let them return the coin to you if they try that, make 'em call PCGS themselves.

that was an interesting read, much like one of the "Breaking Vegas" shows on Discovery Channel.

coinkat · April 26, 2005 11:10AM

I think you have to consider many things here... Grades are an opinion. We submit coins for an opinion as to grade and authencity. The view expressed by PCGS is their opinion and because the coin is in a PCGS holder, the current owner may choose to return the coin to you or return it to PCGS or even disagree with PCGS view as to the authenticity and keep the coin.

MrXray · April 26, 2005 11:12AM

Help the buyer out however you can with PCGS, but do not by it back at this point.

Peaceman · April 26, 2005 11:13AM

WOW..... I'd let the owner of the coin take care of the return to PCGS. I would, however, inform the buyer to do as such.

mozeppa · April 26, 2005 11:19AM

in the article....

PCGS has certified 95 of these contemporary counterfeit micro O coins in the past: 26 1896-Os; 31 1900-Os; and 38 1902-Os. For anyone who currently owns a PCGS graded example of these contemporary counterfeit micro O Morgans dollars, PCGS will reimburse the owner for the current market value of the coin(s) under the terms of the PCGS Grading Guarantee. Anyone who wants to take advantage of the PCGS Grading Guarantee for their micro O Morgans should contact PCGS customer service

Cameonut · April 26, 2005 11:21AM

Greg
Take the high road. Notify the buyer and tell him/her of what you have learned. The buyer can submit to PCGS themselves or they may opt to return the coin to you for a refund and you can send it to PCGS. But that choice is up to the buyer. Either way you can sleep better at night, knowing you did the right thing.

Also, you will have a customer for life. That is more important than the $$.

Good luck.
Cameonut

greghansen · April 26, 2005 11:28AM

Thanks for the input so far. I'm leaning towards the Cameonut solution as thats what my 'moral compass' tells me to do. I'm turning in for the night and will read the rest of the comments in the morning. I think it is a 'one off' event...not likely to recur...so probably best just to step up and take care of it.

What a joke it would be if I bought it back, and it turned out to be a rarer collectible five years from now as one of the 'few surviving samples' of the variety that fooled the pros and managed to get slabbed. Oh well, my head is spinning, so I'm out for the night. Again thanks to all for your input.

jeffatbeach · April 26, 2005 11:29AM

Pack your bags for the Buffalo State Quarter STATE, Levenworth, Kansas !!

ChangeInHistory · April 26, 2005 11:30AM

Cameonut

CoinResource · April 26, 2005 11:32AM

Tell the buyer about the news and PCGS guarantee!!!!

JRocco · April 26, 2005 11:35AM

Do the right thing Greg, contact the buyer and explain the situation, then let him decide where to go from there. I just won a coin in one of your auctions the other day because I look at you as an honest seller. A little good will goes a long way in our little hobby here. I will bid in your auctions again-JRocco

Russ · April 26, 2005 11:38AM

<< or even disagree with PCGS view as to the authenticity and keep the coin. >>

They had one of the coins tested for metal content, and it's the wrong composition.

Russ, NCNE

MrEureka · April 26, 2005 11:40AM

Great discovery by PCGS!

BTW, although unlikely, it's still possible that some real examples of these coins exist. Keep an open mind...

DMWJR · April 26, 2005 11:43AM

<< Great discovery by PCGS!

BTW, although unlikely, it's still possible that some real examples of these coins exist. Keep an open mind... >>

I acutually have several of each date. I'll be checking them tonight!

prooflike · April 26, 2005 11:52AM

PCGS should be contacting you to find out who you sold it too so they can give the buyer their money back!

Wolf359 · April 26, 2005 11:55AM

They had one of the coins tested for metal content, and it's the wrong composition.

Must have been PCGS. Other tests were inconclusive. High in silver, but so was the control coin, proving zippo.

mgoodm3 · April 26, 2005 12:03PM

I agree with jrocco.

braddick · April 26, 2005 12:07PM

I would think, not too far in the future, this contemporary counterfeit would be worth more, in the PCGS holder, as it is.
If I was the buyer and you contacted me, I'd simply keep the coin.

kranky · April 26, 2005 12:12PM

Weighing both sides, I think it's best for you to contact the buyer and tell him you will either buy it back (and pursue your refund through PCGS yourself) or provide the contact information for the buyer to contact PCGS directly. No one could expect you to do more.

If you don't, the buyer might try to sell the coin later, and then find out the story, then blame you (albeit unjustly) for pulling a fast one. It's not unheard of for sellers to get a bad rap even when it's unjustified!

I wouldn't be surprised if the buyer declines an offer to sell it back to you, for fear that you could sell it for even more and cutting him out. But even if that happens, you've made all reasonable efforts to make the buyer whole and no blame could be placed on you.

BAJJERFAN · April 26, 2005 1:02PM

Since you did not know at the time that it could be counterfeit you really have no fiduciary obligation to the buyer. If you want the coin as a souvenir or curiosity piece and think it might even go up in value then try to buy it back. If you don't want the coin back refer him to the PCGS article and let him decide if he wants to pursue restitution thru PCGS.

robertpr · April 26, 2005 1:11PM

Well I didn't read the entire article so please, someone correct me if I'm wrong but what I got out of it is:

• PCGS had recently a large number of micro O coins submitted.
• PCGS examined them thouroughly and found evidence they are counterfeits.
• PCGS then determines that ALL micro O coins of those dates are counterfeit, not just the coins in the recent onslought.

Am I missing something or is PCGS extrapolating a bit here? Perhaps the variety itself is genuine but the recent rash of them that was submitted was a counterfeit hoard.

markglicker · April 26, 2005 1:32PM

Greg. If it were me, I would offer a refund, with or without the PCGS guarantee. PCGS should take you off the hook. Should they not, your recourse would be with the party that you purchased the coin from.

TonedPeaceNut · April 26, 2005 1:33PM

<< They had one of the coins tested for metal content, and it's the wrong composition. >>

Gee, I wonder how they did that?

Anyway -- if an AT coin in a PCGS slab can fetch $2550 on Ebay, imagine what this coin might sell for someday to the right buyer!

But yet again I disgress -- Greg take the high road, inform the buyer of the PCGS article, offer a refund and let them decide what to do!

TPN

tjkillian · April 26, 2005 1:35PM

I believe all coins should come with a life-time warranty for authenticity. That being said, I could easily believe that the coin is now more valuable than when you sold it. I would contact the buyer, offer to buy it and also tell of the PCGS article and the fact that he could get his money back from PCGS too!

Let the buyer make his own mind up, but offer to refund his full purchase price, including shipping. There should be no time limit for coins that are not genuine.

Tom

relayer · April 26, 2005 1:41PM

I would first contact PCGS and ask them what they would cover for a VG-8

If they'll cover the $1,250 he paid from the eBay auction as an invoice I would contact him and tell him to contact PCGS

If PCGS won't cover the whole $1,250 then you'll have to work out something else with the buyer??

But I think knowing where the coin stood with PCGS would be the first step, and then go from there.

I'm sure PCGS would cover what he paid because they're the ones that gauranteed it was authentic.

wayneherndon · April 26, 2005 2:38PM

You should inform the buyer and offer a full refund. If he accepts and I were in your shoes I'd keep the coin rather than return it PCGS. But that would be up to you.

WH

itsnotjustme · April 26, 2005 2:59PM

Notify the buyer. Offer to take a return at purchase price less shipping costs. Let them know they can also go directly to PCGS (clearly the preffered route to minimize your work.... you could offer to make up the diff if PCGS pays them less thean they paid you).

clackamas · April 26, 2005 3:09PM

Since you really have nothing to loose contact the buyer, they would appreciate it, you can get your money back from PCGS so it is no loss to you. It s too bad the buyer could not leave feedback. If the buyer wants THEY could send the coin to PCGS, or if you buy it back it may actually be worth more, like to OMEGA counterfiets.

USC · April 26, 2005 4:00PM

<< I'd say you do nothing - PCGS, after all, did authenticate the coin. Sounds like their problem. The buyer can take it up with them. >>

Spoken like a true jack ass.

mozin · April 26, 2005 4:26PM

Notify the buyer about the PCGS article and the PCGS guarantee. I don't think you need to do more.

construct · April 26, 2005 5:08PM

Well, let's see. I think I would start with an implied warranty of merchantability. Is the coin what you claimed it was? I would infer from the auction that you implied that the coin was genuine. PCGS authentication served as evidence that the coin was genuine as you believed it to be. I grant that you did not expressly say that you guaranteed the authenticity of the coin, but given the statutory restrictions on counterfeiting, it must be assumed. If he requests a buy-back, I think you may be obligated to accept.

Do you have a duty to inform him after the sale has been completed? You sold the coin as is. He has had the opportunity to examine it and inform himself as to whether it meets his expectations. In this case, you were no more informed than he was about there being fakes to watch out for. I would argue that you do not have a duty to inform. This is expecially true in as much as it is an arms length business transaction with a good that does not endanger anyone except economically. It would be another matter altogether if we were talking about the recall of a dangerously defective car, for example.

My conclusion is that you may inform the buyer or not as you please, but if he requests a return, you should accept the return and refund the purchase price and shipping costs.

Alternatively, he may seek to collect from PCGS directly.

KurtHorn · April 26, 2005 6:06PM

PCGS has certified 95 of these contemporary counterfeit micro O coins in the past: 26 1896-Os; 31 1900-Os; and 38 1902-Os. For anyone who currently owns a PCGS graded example of these contemporary counterfeit micro O Morgans dollars, PCGS will reimburse the owner for the current market value of the coin(s) under the terms of the PCGS Grading Guarantee. Anyone who wants to take advantage of the PCGS Grading Guarantee for their micro O Morgans should contact PCGS customer service.

Interestingly, many in the numismatic community likely will still collect these curiosities. They are such good copies that they have circulated with genuine silver dollars since they were made. As with some Colonial issues, collectors strive to complete their sets and include circulating counterfeits of many issues. When the copy is good enough to fool the rank and file, the imposter has no trouble traveling in the circle of genuine coins.

You absolutely must attempt to contact the buyer. Tell him of this information coming to light, share with the buyer a link with to this article. The buyer may choose the road with the last paragraph and decide to keep the coin as collectible anyway. After all how rare are these things going to be when PCGS starts buying them back? But you have to share the info. Worse case scenario - you end up buying it back and PCGS buys it back from you. Best case the guy keeps it.

gyocomgd · April 26, 2005 6:56PM

Buy my fake 1916-D Merc cheap, and devil take the hindmost.

dorkkarl · April 26, 2005 7:31PM

do nothing. that's what the plastic is for, to handle cases like this.

K S

greghansen · April 26, 2005 8:25PM

Thanks again for all the input. It really helped me distill my thoughts. After a good nights sleep, I've decided I will do whatever the buyer wants to do. I had already sent them an email last night before going to sleep alerting them to the article. Haven't heard from them yet, but to satisfy the curious...I will post a followup with what they decide once I make contact.

Even as much as I agonized over my 4 month old sale...looks like my problem isn't as big as some. I see one EBAY auction of an 1896-O ended last night, AFTER the article came out. Sold for pretty good money too. That auction is here: 1896-O Micro O Ended one day after article out.

There are also several CURRENTLY PENDING auctions with coins affected by this finding:

1900-Micro O current auction affected by finding.

Current auction for 1896-O micro O on EBAY

Another current auction for 1896-O micro O on EBAY

Current auction for 1900-O micro O on EBAY

1902-Micro O current auction affected by finding

Plus, as I mentioned on the other thread addressing this topic there has been a surge of recent sales of these micro-O coins. Looks like lots of sellers have decisions to make. As I mentioned on the other thread...since the coin dealer community is pretty close, and several have good contacts at the grading services, I hope no one was taking advantage of inside information about the ongoing investigation to dump these coins. I just find it odd, the high number of these coins that suddenly were on the market within the last 6 weeks. Oh well, I guess thats their moral delema, not mine. Here are a sampling of the recent auctions:

Recent auction of 1900-O micro O on EBAY

Recent auction of 1902-O micro O on EBAY

Recent auction of 1902-O micro O on EBAY

And those are just the certified ones. There are others that were sold raw. Just running a basic EBAY search for completed Morgan auctions using 'micro' as the search term turned these up. I don't know the sellers of the current auctions and don't really have the time to monitor these sorts of things. I hope someone will notify EBAY and the sellers of the current auctions of this news, so they can take the auctions down or put the appropriate disclaimer in them.

dorkkarl · April 26, 2005 8:54PM

ebay has no liability or reponsibility here, imo. pcgs has guaranteed the coins & stepped up to the plate per their excellent authenticity guarantee.

it's up to collectors to keep up w/ the latest, & pcgs has done their part to publicize the situation.

besides, i bet these c/f's are going to be HOT commodities.

K S

PerryHall · April 26, 2005 9:13PM

I agree with Karl. These will be collectable and in much demand. Aren't the Machin Mills coins and the Jefferson head large cents contemporary counterfeits? Some day the TPG's may slab these coins with a notation on the slab insert as to their nature especially if they become popular collectibles among morgan collectors.

RobJoyce1921dVAMguy · April 26, 2005 9:32PM

I've also sold 2 micro Os recently on ebay. I've contacted both buyers and told them of the news and offered to buy them back if they choose not to keep them or use the PCGS guarantee.

Rob

BAJJERFAN · April 26, 2005 9:46PM

Until it can be examined in hand you really don't know for sure that the coin IS c/f only that it MAY be. Is eBay required to refund your final value fees if the buyer wants his $$$ back and you agree to the return. Also PCGS can speak only about the coins they have in hand and as far as the others they have graded in the past merely speculate that they too may be c/f.

greghansen · April 26, 2005 9:58PM

The gist of the PCGS article I am coming away with is that ALL micro O's of 1896, 1900 & 1902 are believed to be counterfeit. I sounds like ALL of the examples they have seen have the diagnostic markers. I only have my VF30 1900-O to look at in hand, and it clearly has the markers they show in their article. When the dust settles I do not believe that there are going to be both genuine AND counterfeit samples of these years in the micro O variety. I don't believe PCGS is convinced that the mint produced micro O's for those years.

It will be interesting to see if any of the more prevelant 1899 or 1880 micro O's show up with the counterfeit diagnostics. As I understand it, PCGS believes that legitimate micro O's were made by the mint for both of those dates. I have several 1899's which I have checked and cannot find the counterfeit markers on.

SilverDollarMan · April 26, 2005 10:00PM

<< Doesn't pcgs have some kind of a guarantee?

PCGS does have a Grading Guarantee and their article announcing their finding makes very clear that those who wish to turn their coins in, will be reimbursed at what they determine to be the fair market value.

I have not been contacted by the buyer...I have no idea if the buyer is even aware of this finding by PCGS yet. I didn't know anything about it until reading the other thread on the board. I will be notifiying him/her in the very near future, however, and would like to have a plan of action in mind when I contact them. Never had this one happen to me before. >>

Market value = 0

greghansen · April 26, 2005 10:52PM

Market value = 0

That's just flat out wrong. I will be contacting PCGS customer service later today and will post anything of interest that I learn. But to suggest they are going to say the market value is zero is irresponsible. I believe they will step up to the plate in a very fair manner. We'll see how it plays out.

I sold a counterfeit coin. What do I do?

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