Imitation CoinGuy1 Thread: Has CoinDealer1 done anything wrong?
DMWJR
Posts: 6,006 ✭✭✭✭✭
Here's a scenario that I think will illustrate a good point that many of us wrestle with. Typical Coinguy1 rules apply -- there is no wrong answer and this is not based on a real life fact pattern.
GrannySmith goes into the local coinshop to see if CoinDealer1 will buy three old coins she found in her husbands things after he passed away. She knows nothing about them except they are old, big, and shiny.
The coins are three Morgan Dollars as follows:
1. 1878 in MS60 (but is also an 8TF Vam44 which the dealer immediately recognizes)
2. 1881-s in MS 65 ACG holder (dealer sees that the coin is in fact ACCURATELY GRADED)
3. 1893-s in VG.
SCENARIO 1: CoinDealer1 whips out the latest Greysheet and shows here the type coin section. He accurately describes the grade of each coin and is accurate on his grading. He tells her that he will buy them for the greysheet value for type coins in those grades which are $20, $100, and $8 respectively. She looks at the coins and says "yes I can see how the value is equal to the grades." She takes the $128 and leaves the store with a big smile on her face.
SCENARIO 2: CoinDealer1 whips out the latest Greysheet and shows here the Morgan Dollar section. He accurately describes the grade of each coin and is accurate on his grading. He tells her that he will buy them for the greysheet value for type coins in those grades which are $35, $100, and $1,200 respectively. She looks at the coins and says "yes I can see how the value is equal to the grades." She takes the $1,335 and leaves the store with a big smile on her face.
Ok, what if anything has CoinDealer1 done in these two scenarios?
I hope this is a fun scenario and one in which some new members might learn something.
Doug
0
Comments
Scenario 3: She hires an agent to get her the most for the coins for a 10% commission.
Scenario 4: Heritage auction.
Which is more than likely what would happen.
<< <i>Typical Coinguy1 rules apply -- there is no wrong answer and this is not based on a real life fact pattern. >>
Doug, on the contrary, there are indeed "wrong" answers to many of the situations I present here. : )
Now, on to your questions......l.
Scenario 1:
If the VAM44 was worth extra $ and the dealer knew it, he was deceitful in pointing to the "type" coin on the sheet. Even if not a rare variety, the 1878 is not a "type" coin anyway, so that would be deceitful too. Ditto for the 1893-S on a much larger scale.
I don't know what type of spread there is between ACG and the major grading companies for an MS65 1881-S, but that part of the transaction is probably ok with me, due to the small spread, cost of crossover or submission and possibility that the dealer was wrong about the coin anyway. The larger the spread, the more difficult that part of the transaction would be for me.
SCENARIO 2:
In the case of the 1878, while the dealer was up front about the 1878 being a better date, he was still deceitful about the variety which he recognized.
In my opinion, the dealer was dishonest in both scenarios, though far worse in #1 than in #2
The way I once heard it explained was this:
If Granny asks "What would you give me for these?", then the dealer did nothing wrong in Scenario 1. There was an offer, which she could accept or refuse. If she accepts, then no harm, no foul. I would see it as blatantly taking advantage of someone, but I understand how things work.
If Granny asks "What are these worth?", then the dealer was wrong in Scenario 1. What he offered is clearly a false answer to the question.
What I would consider "fair" to Granny is for the dealer to make an offer that fully reflects the rarity and value of the coins as he recognizes them - including the VAM. That offer would be no less than 30% back of bid.
In my dream world, the dealer offers to get coins 1 and 3 slabbed and then sells them for a 15% commission, but I realize that Granny will find that very confusing, even suspicious, since the coins would have to be sent away before the deal is finalized.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
#2 granny should go to Veags!
If the dealer was a member of the ANA, and they found out about the transaction, then he or she would be in hot water over ethics.
It's ok to make a profit, but if you have to lie or cheat to do so, then you have diminished yourself as a human being.
<< <i>:
If the dealer was a member of the ANA, and they found out about the transaction, then he or she would be in hot water over ethics.
It's ok to make a profit, but if you have to lie or cheat to do so, then you have diminished yourself as a human being. >>
Then the coin vault people should be fish by now.
<< <i>
<< <i>:
If the dealer was a member of the ANA, and they found out about the transaction, then he or she would be in hot water over ethics.
It's ok to make a profit, but if you have to lie or cheat to do so, then you have diminished yourself as a human being. >>
Then the coin vault people should be fish by now. >>
Coin Vault is a member of the ANA?
Cameron Kiefer
<< <i>
<< <i>
<< <i>:
If the dealer was a member of the ANA, and they found out about the transaction, then he or she would be in hot water over ethics.
It's ok to make a profit, but if you have to lie or cheat to do so, then you have diminished yourself as a human being. >>
Then the coin vault people should be fish by now. >>
Coin Vault is a member of the ANA?
Cameron Kiefer >>
No im talking about the deminishing yourself as a person part.Ive yet to learn how to quote specific things.
<< <i>These are always touchy situations.
The way I once heard it explained was this:
If Granny asks "What would you give me for these?", then the dealer did nothing wrong in Scenario 1. There was an offer, which she could accept or refuse. If she accepts, then no harm, no foul. I would see it as blatantly taking advantage of someone, but I understand how things work.
If Granny asks "What are these worth?", then the dealer was wrong in Scenario 1. What he offered is clearly a false answer to the question.
What I would consider "fair" to Granny is for the dealer to make an offer that fully reflects the rarity and value of the coins as he recognizes them - including the VAM. That offer would be no less than 30% back of bid.
In my dream world, the dealer offers to get coins 1 and 3 slabbed and then sells them for a 15% commission, but I realize that Granny will find that very confusing, even suspicious, since the coins would have to be sent away before the deal is finalized. >>
In my mind, that went beyond (and was worse than) simply making an offer, even a low one.
<< <i>
<< <i>Typical Coinguy1 rules apply -- there is no wrong answer and this is not based on a real life fact pattern. >>
Doug, on the contrary, there are indeed "wrong" answers to many of the situations I present here. : )
Now, on to your questions......l.
Scenario 1:
If the VAM44 was worth extra $ and the dealer knew it, he was deceitful in pointing to the "type" coin on the sheet. Even if not a rare variety, the 1878 is not a "type" coin anyway, so that would be deceitful too. Ditto for the 1893-S on a much larger scale.
I don't know what type of spread there is between ACG and the major grading companies for an MS65 1881-S, but that part of the transaction is probably ok with me, due to the small spread, cost of crossover or submission and possibility that the dealer was wrong about the coin anyway. The larger the spread, the more difficult that part of the transaction would be for me.
SCENARIO 2:
In the case of the 1878, while the dealer was up front about the 1878 being a better date, he was still deceitful about the variety which he recognized.
In my opinion, the dealer was dishonest in both scenarios, though far worse in #1 than in #2 >>
I'm gonna take the easy route and just go...............................
42/92
If the dealer had simply made a lowball offer and stated something like "This is what I am willing to pay, "etc, then he effective made a rip and there was no misrepresentation (although I would not want to do business with this guy)
BUT when he started showing her the sheet he was trying to deceive her into thinking that this was the market value and this sheet here proves it. Then he pulls a fast one and points out incorrect figures knowing she does not understand the details. This is dishonest and is as bad a stock broker flashing false quotes on a ticker tape and dealing at fraudulent prices.
<< <i>I agree with coinguy1.
If the dealer had simply made a lowball offer and stated something like "This is what I am willing to pay, "etc, then he effective made a rip and there was no misrepresentation (although I would not want to do business with this guy) >>
He should have at least kissed granny. Remember when not telling the whole truth was as bad as lying? This is that case.
In scenario #1, he should have mugged granny. It is more upfront than what he actually did.
wait a second...
siliconvalleycoins.com
In scenario 1, Granny Smith is deprived of value in two ways: she doesn't know the value of the date rarity of the 93-S, and she also doesn't know the value of the variety rarity of the VAM44.
Is there a difference between the rarity of a date and the rarity of the variety?
Is there a problem with the dealer not disclosing one while disclosing the other?
Why?
We have assumed here granny was unaware of the value but no one said she was mental incapacitated. She has to decide whether to accept the offer or look around. If the dealer made no attempt to decieve her then lets not oblogate them to provide granny or anyone else with all thier cards on the table. Its not business, it's not capitalism, it's not American and it's just not the way its done in any other business.
<< <i>I know Slave Mart is going to build a big center down the street . >>
You aren't taking a shot at WAL-MART are you ?????????
<< <i>You aren't taking a shot at WAL-MART are you ????????? >>
Who?? ME??? It's unbelievable how people will talk about freedom and human rights but rush over to Wal-Mart to save 5 bucks on merchandise that is made by 10 year old kids working 14 hour days.
1. 1878 in MS60 (but is also an 8TF Vam44 which the dealer immediately recognizes)
2. 1881-s in MS 65 ACG holder (dealer sees that the coin is in fact ACCURATELY GRADED)
3. 1893-s in VG.
SCENARIO 1: CoinDealer1 whips out the latest Greysheet and shows here the type coin section. He accurately describes the grade of each coin and is accurate on his grading. He tells her that he will buy them for the greysheet value for type coins in those grades which are $20, $100, and $8 respectively. She looks at the coins and says "yes I can see how the value is equal to the grades." She takes the $128 and leaves the store with a big smile on her face.
SCENARIO 2: CoinDealer1 whips out the latest Greysheet and shows here the Morgan Dollar section. He accurately describes the grade of each coin and is accurate on his grading. He tells her that he will buy them for the greysheet value for type coins in those grades which are $35, $100, and $1,200 respectively. She looks at the coins and says "yes I can see how the value is equal to the grades." She takes the $1,335 and leaves the store with a big smile on her face.
GrannySmith, who obviously knows next to nothing about the coins she wants to sell, is making a huge error by accepting either offer, no matter the "scenario", from CoinDealer1, a stranger to her. One should always get another opinion about what makes for a fair price for coins from at least one other dealer. Furthermore, GrannySmith shouldn't seek out a recommendation for dealer to go to for second opinion from CoinDealer1. The possibility of collusion to commit fraud among unethical dealers is definitely there.
GrannySmith does know a little more after visiting with CoinDealer1, ie. "the value is equal to the grades."
She knows that "there is a greysheet with prices." She can use what she knows to her advantage to, eventually and hopefully, get a fair price for her coins.
As for CoinDealer1, a $128 offer for these coins is prima facia evidence that he is a thief. The truth of this might "out" for GrannySmith but would only happen if she gets at least one other, this time hopefully honest, opinion. In SCENARIO 2, after making his offer, CoinDealer1 should suggest to GrannySmith that she might get another opinion about her coins and stress the point to Granny that she should not disclose his offer for the coins to the other dealer. By doing this he is cluing her in that," yes, there are unethical dealers out there." He can further suggest that if subsequent offers are lower than his she can come back to the shop, say within a week or so, and he will make good his $1335 offer. CoinDealer1 in the second scenario might even find out a few things from Granny, if she comes back into the shop with her coins still for sale, about his "friends" in the coin business.
Great spirits have always encountered violent opposition from mediocre minds.-Albert Einstein
I firmly believe in numismatics as the world's greatest hobby, but recognize that this is a luxury and without collectors, we can all spend/melt our collections/inventories.
eBaystore
<< <i>It is illegal, IMHO, for a legitimate coin dealer to act in the #1 scenario. >>
I agree it is completely unethical, but do you consider the VAM44 to be different?