Mint's ingenious use of tokens and counterfeit coins
RogerB
Posts: 8,852 ✭✭✭✭✭
Old contemporary counterfeit coins are fascinating. They help us relate to the economic importance of small change, and willingness of criminals to victimize anyone at anytime.
The letter transcribed below shows a creative approach to dealing with both counterfeit minor coins, and merchant copper/bronze tokens that had accumulated during the redemption period.
"Treasury Department
Office of the Director of the Mint
Washington, D.C.
March 17, 1879
Hon. A. Loudon Snowden
Superintendent U.S. Mint
Philadelphia, Pa.
Sir,
Referring to your letter of the 13th instant, in which you state that there were included in the amount ($221,800.63) of base minor coins belonging to the Minor Coinage Redemption Fund, transferred to you by your predecessor in office, the sum of $214.63 in counterfeits which have been accumulating many years; and as there is no appropriation from which this shortage can be made good to the Treasury, requesting that you be authorized to utilize some 3,300 ounces of rejected copper tokens which have accumulated from coins offered from time to time for redemption. You are hereby authorized to have those token coins melted and assayed, and if the metal contained in them is found suitable, to cause one cent bronze to be coined from the same, and from this amount as coined, substitute $214.63 for the counterfeit coin no in the Redemption Fund.
The counterfeits you will please have melted and sold as old metal, and the proceeds paid into the Treasury.
I am Sir, very respectfully,
Horatio Burchard,
Director"
[RG104 E-1 Box 116 via NNP]
Comments
O, to have had access to that group of Civil War Tokens before they were melted......
The mint's internal problem with counterfeit coins was that they were not supposed to exist. The law had no means for dealing with them once accepted for redemption. It was intended that each deposit for redemption was checked by the depositor and mint staff, then only good coins were accepted. But the volume of coin and shortage of staff meant that most redeemed coins were checked months or years after deposit.
Snowden's solution was to melt tokens, mistakenly accepted in exchange for flying eagle and large cents, then use the metal to strike bronze cents. This "new" money, for which Congress had appropriated funds to process was then exchanged for counterfeits mistakenly accepted. It kept the books balanced, even if this use of the cents was not entirely what Congress thought it was authorizing.
Some problems are so minor that they should be ignored as they cost more to fix than they are worth. When I grew up in Detroit it was common to get Canadian coinage in change. Wasn't worth worrying about. So the mint had a couple of hundred bucks in scrap metal listed as coinage? Big whoop. Jiggle the books and get on with it.
I remember when I started working for Wally Perschke in Chicago I thought that the bookkeeper was rather cute. I invited her to lunch at the Italian restaurant across the street one day, but when it was time to go she said that she had to find a $2 error in one of the accounts. I took two one dollar bills out of my pocket and said "Let's go," but it did not work that way.
Redemption was politically and economically sensitive, so it likely got more attention than problems were worth.
There was also a persistent difficulty with excessive counterfeiting of 5-cent nickels compared to all other denominations (possibly except gold dollars).
THIS!
I imagine a good number of rarities went off to the smelter. One man's trash is another's treasure...
Dead Cat Waltz Exonumia
"Coin collecting for outcasts..."
"...3,300 ounces of rejected copper tokens..."
Is that about 25,000 pieces?
I wonder if there were Hard Times tokens as well.
Pacific Northwest Numismatic Association
The $214.63 discrepancy would be 21,463 pieces, no?
Probably fewer pieces - most counterfeits mentioned during this time period were 5-cent nickels. All that mattered was the value in dollars that the account was short.
But it says “copper.”
Troy or Avdp. ozs?
The letter talks about 'redemption'....were these passed off on the government? Or did they have an exchange program in which they gave good coins for the counterfeits? Cheers, RickO
The weights of the tokens varied considerably, but using the small cent standard weight of 48 grains per, then 3,300 avdp. ozs. = 30,078.125 pcs. 3,300 troy ozs. would be 33,000 pieces.
Treasury was redeeming fractional currency for coin/greenbacks/silver certificates and also redeeming old large cents/half cents, FE cents, CN cents, 2 cents, and both types of 3-cent, plus older shield nickels and half dimes. The whole enterprise was confusing to merchants and banks because the terms fluctuated from time to time. Early on, 3-cent silver was not accepted, then it was, then it wasn't, then it was if you asked nicely, etc. The basic ideas were: to get fractional paper out of circulation, and remove worn and obsolete alloy coins. A simplification of circulating coins. Base minor coins were replaced with new CuNi 5-cent pieces and bronze 1 cent coins, or larger denomination greenbacks - but not gold and only sometimes subsidiary silver. Silver dollars were considered at "par" with gold dollars (although they really weren't in metal value), and were not included.
Exchanges were not made for counterfeits. The last holder was stuck with the loss.
I recommend that you can get a better perspective by searching the NNP.
Capt. -- I've seen both Avd. and T. used to refer to base metal coins. Mint orders for copper, nickel, tin and zinc are normally in Avd. tons., so assuming an Avd. ounce seems reasonable.
So if a non-counterfeit but non-legal tender CWT came in in a lot they paid nothing for it and just kept the metal.
What if they got in say a silver Canadian 10 Cents as part of a large lot?
Anything not a US coin was considered bullion or junk metal. If discovered before the deposit was paid for, the value, if any, was deducted from payment. Base metal pieces were worthless and deducted based on the category of coin the depositor had included them in. Canadian silver was the same alloy as US, so the depositor was credited with only the silver bullion value. The same applied to Mexican 8 reales and 8 escudos - bullion only.
@RogerB....Thanks for the information... will look further...Cheers, RickO