MN Department of Commerce Visits Coin Show Today (7/27/14) 8/1/14 Update Added

foodude · July 27, 2014 4:36AM

There have been previous posts about the MN Coin Dealer Bullion law, where any coin containing more than one percent by weight of silver, gold, platinum, or other precious metal without any relationship to the intrinsic metal value of the coin compared to the numismatic or collector value, if any, of the coin; basically all coins containing more than one percent by weight of silver, gold, platinum, or other precious metal are bullion coins under the law.

Today the second show since the law went into full effect is currently being held. There are 19 dealers at the show, 8 are registered under the law, or in the process of being registered, and 11 are unregistered. Earlier in the show one of the enforcement people from the MN Department of Commerce stopped by and gave warning letters to at least two dealers, and asked them to call him and discuss their situation. He may have also collected information (e.g., business cards) from other non-registered dealers. Many of the the dealers did not even realize he was here.

edited to add: There were fewer tables sold at the show today than usual- one dealer that counted thought there were 8 fewer than the show typically had- it did look like a few dealers were more spread out than usual.

Here are links to the previous posts:

Minnesota "Bullion Coin Dealer" Law

MN Coin Dealer Law- July 1, 2014 NN Article

New Draconian Anti-Collector Law Takes Effect in Minnesota

Here is a link to the law itself: 80G

August 1, 2014 Update:
A bit more information. The MN Department of Commerce contacted the bourse chair for the show held last Sunday (7/27/14), and today the bourse chair provided the MN Department of Commerce enforcement people with the list of each dealer that attended the show along with their respective contact information.

I know they have been looking at, and contacting MN dealers that have not registered to "discuss their situation", but so far I am not aware of them contacting any out of state dealers. If anyone knows of an example where they have contacted an out of state dealer, and are willing to let me know, please pm me.

BTW, we are a registered MN dealer and will be at the ANA show next week at Table #231 if you want to stop by and talk about this law.

Strat · July 27, 2014 5:23AM

Only 19 dealers at a local show, and a state representative shows up to investigate. That really is draconian.

DMWJR · July 27, 2014 5:37AM

This is terrible. Do any other states currently have a law this bad in place?

Treashunt · July 27, 2014 6:01AM

<< This is terrible. Do any other states currently have a law this bad in place? >>

no other states.

The law is idiotic

foodude · July 27, 2014 6:20AM

As far as I know, MN is the only state with a law like this.

Attending the show is just one way for them to get the message out to those that have not registered. They have also been monitoring other avenues, and sending warning letters, but what their overall strategy is we don't know. There are already a number of dealers that usually do this show, that said they are no longer setting up at the show.

TwoSides2aCoin · July 27, 2014 6:38AM

We need more enforcement people on the payroll. Sounds like they were understaffed by 18. Thanks for the report. Maybe the administration will go into emergency session and see how understaffed local governments are and hire some more enforcement personnel. Let's hope the show promoter starts charging for parking.

Those draconian geniuses will get it together one of these days.

Zoins · July 27, 2014 7:00AM

Did any of the 6 figure consumer losses that led to this law result from show purchases?

epcjimi1 · July 27, 2014 7:27AM

<< Earlier in the show one of the enforcement people from the MN Department of Commerce stopped by and gave warning letters to at least two dealers, and asked them to call him and discuss their situation............. Many of the the dealers did not even realize he was here.

>>

Crazy and a WTF.

Ahrensdad · July 27, 2014 7:45AM

Foodude, thank you for keeping this MN law in the spotlight.

I am a registered MN dealer and small time show promoter. The law itself whether intended or not will drive out the small dealers thereby limiting choice for consumers. We have a robust monthly coin show circuit in the Twin Cities area. As many here know these types of shows are largely made possible because the small dealers, the part time dealers fill the gap to cover the show overhead. Without these dealers, show promoters will have few choices available to them. They can either cover the deficiency from their own pocketbook (unlikely over the long haul), increase table fees, or cease operations. Eventually, the increased costs will be a millstone around the promoters neck leading to the closing of shows if they can't attract enough dealers to pay table fees. Again the consumer is the one that is hurt with fewer choices on the buy and sell side.

And frankly, small is relative.

In the show I promote, only one of our regular dealers has a shop/office. He is from out of state and has decided not to do shows in MN in the future. All of the other dealers that set up are either retired from other professions, are currently employed in other professions or own a business having nothing to do with numismatics. I frankly don't consider any of these dealers big. Some have bigger inventories than others, but none of these guys swim in the deep end of the numismatic pool.

I know the argument can be made that with fewer dealers, and consumers having fewer choices, as a registered dealer I should have more business. In my opinion, this argument makes the point as to why this law is bad. It is my opinion that a vibrant show scene leads to vibrance in the hobby as a whole. It keeps current collectors interested, and attracts new collectors.

I know I'm preaching to the choir, but let my voice join with yours in saying this is a bad law. It is especially bad for the vary consumers it is supposed to protect.

Andrew

Edit for grammar, content unchanged.

foodude · July 27, 2014 7:54AM

Did any of the 6 figure consumer losses that led to this law result from show purchases?

I believe the answer is no. Further, I believe none of the dealers that take tables at any of the local shows where the dealers involved with that even outside the show.

coindeuce · July 27, 2014 8:07AM

When the liberal progressives who enacted this law get wind of how much state revenue will be lost as these shows close down, maybe, just maybe someday they'll wise up. Jesse Ventura would never have let these clowns enact such an absurdly draconian piece of legislature.

BillJones · July 27, 2014 8:16AM

It's nice to know that the state of MN. is crime free, and they can now spend their time policing coin shows. Why else would they be spending their resources on this activity?

halfhunter · July 27, 2014 8:17AM

<< We need more enforcement people on the payroll. Sounds like they were understaffed by 18. Thanks for the report. Maybe the administration will go into emergency session and see how understaffed local governments are and hire some more enforcement personnel. Let's hope the show promoter starts charging for parking.

Those draconian geniuses will get it together one of these days.

>>

Maybe gainful employment for all the MN ex-coin dealers ? ! ? !

HH

PerryHall · July 27, 2014 8:37AM

<< It's nice to know that the state of MN. is crime free, and they can now spend their time policing coin shows. Why else would they be spending their resources on this activity? >>

States need revenue and they don't care who they steal it from.

foodude · July 27, 2014 9:32AM

It's nice to know that the state of MN. is crime free, and they can now spend their time policing coin shows. Why else would they be spending their resources on this activity?

Depending on how an investigation goes forward, under the law, they can bill the people investigated for the investigation, so in the end, it may not be the State's $. They have a staff now of about 5. And at this point, they may not know all who is who in the coin business and who goes to which shows. It is easy for them to get a list of who attended which shows, and compare it to the list of who is registered or not and how many shows they done in a given period. While that alone is not enough to know if the law applies to a particular dealer, it may be enough to trigger a letter asking the dealer to contact them to discuss their situation- something they have done at least 4 times in the last 2 weeks.

19Lyds · July 27, 2014 9:47AM

<< Only 19 dealers at a local show, and a state representative shows up to investigate. That really is draconian. >>

Especially since it wasn't this type of "coin/bullion dealer" that ripped all those people off. It was the Telemarketers that call you on the phone with their "promises of riches"!!

3keepSECRETif2rDEAD · July 27, 2014 9:49AM

...sounds like Germany in the late 1930's...that sucks man!

Erik

hchcoin · July 27, 2014 10:22AM

Wow

Cougar1978 · July 27, 2014 10:50AM

What a terrible situation. Some paid public employee trying to justify their existence by going after dealers and how many shows they may have attended......then try to estimate how much the dealer may have sold.

Tomthecoinguy · July 27, 2014 3:13PM

<< Did any of the 6 figure consumer losses that led to this law result from show purchases?

I believe the answer is no. Further, I believe none of the dealers that take tables at any of the local shows where the dealers involved with that even outside the show. >>

I can say with absolute certainty that none of the losses that lead to this law were the result of in person transactions. I listened to all of the testimony in the MN legislature and the Assistant Attorney General said specifically that they were all telemarketers.

Tomthecoinguy · July 27, 2014 3:28PM

<< Foodude, thank you for keeping this MN law in the spotlight.

I am a registered MN dealer and small time show promoter. The law itself whether intended or not will drive out the small dealers thereby limiting choice for consumers. We have a robust monthly coin show circuit in the Twin Cities area. As many here know these types of shows are largely made possible because the small dealers, the part time dealers fill the gap to cover the show overhead. Without these dealers, show promoters will have few choices available to them. They can either cover the deficiency from their own pocketbook (unlikely over the long haul), increase table fees, or cease operations. Eventually, the increased costs will be a millstone around the promoters neck leading to the closing of shows if they can't attract enough dealers to pay table fees. Again the consumer is the one that is hurt with fewer choices on the buy and sell side.

And frankly, small is relative.

In the show I promote, only one of our regular dealers has a shop/office. He is from out of state and has decided not to do shows in MN in the future. All of the other dealers that set up are either retired from other professions, are currently employed in other professions or own a business having nothing to do with numismatics. I frankly don't consider any of these dealers big. Some have bigger inventories than others, but none of these guys swim in the deep end of the numismatic pool.

I know the argument can be made that with fewer dealers, and consumers having fewer choices, as a registered dealer I should have more business. In my opinion, this argument makes the point as to why this law is bad. It is my opinion that a vibrant show scene leads to vibrance in the hobby as a whole. It keeps current collectors interested, and attracts new collectors.

I know I'm preaching to the choir, but let my voice join with yours in saying this is a bad law. It is especially bad for the vary consumers it is supposed to protect.

Andrew

Edit for grammar, content unchanged. >>

What really upsets me the most about what happened today, is I personally made the argument to an number of key legislature that the law would kill coin shows, and how coin shows are the best protection a consumer has in the industry.

I felt at the time that my letter made a difference, because shortly after I sent out that letter, the legislation was amended and coin shows were exempt from the law. Apparently, now the department of commerce is interpreting the provisions that exempts coin shows to not exempt coin shows. How strange. What a dirty trick they played to add an amendment to gain legislative support for the bill, and then ignore that provision.

Boosibri · July 27, 2014 8:24PM

The state has a long history of absurdity in politics.

DMWJR · July 27, 2014 10:34PM

Tomthecoinguy ... just wow ... but that is how it works. Executive branches no longer respect the laws passed by the legislature at the federal or state level.

You might also ask them to exempt "in person" transactions.

foodude · July 27, 2014 10:37PM

If anyone finds examples of dealer websites, or ebay lisitngs that state no sales to MN residents, or something similar to this, please send a a link via pm- I am collecting these types of examples. Thanks.

foodude · July 27, 2014 10:41PM

Here are examples of some of the recent suggestions for modifying the law that have already been passed onto the State:

-Use the Patriot 2 definition of bullion in terms of (a) the threshold limit (i.e., the 50% aspect) and (b) the need to write the PM content on a receipt.

-Move the threshold of $5,000 to match that under the Patriot 2 Act.

-Have a minimum of say $25 (higher would of course be better) for the order to trigger the need to write a receipt with the PM content.

-If the PM content is marked on the item (e.g., an ASE, AGE, etc.) there is no need to put the PM content on the receipt; in conjunction with this allow the PM content to be list in ounces or grams as opposed to the current requirement they be listed in grams. Editorial comment: How many consumers understand "grams"?

-Have the law more focused on telemarketing- exclude face-face transactions, for example.

-Some fine tuning to exclude the typical legitimate internet/mail order/ etc. sales of the typical traditional coin dealer- but I am a bit pressed for time to work through this one.

PQueue · July 27, 2014 10:43PM

RE:
The state has a long history of absurdity in politics.

Minnesotans get what they deserve.

TwoSides2aCoin · July 27, 2014 10:45PM

Who ever said "The show must go on" wasn't' listening to the fat lady singing.

dbldie55 · July 28, 2014 12:16AM

<< If anyone finds examples of dealer websites, or ebay lisitngs that state no sales to MN residents, or something similar to this, please send a a link via pm- I am collecting these types of examples. Thanks. >>

Heritage clearly states this in their listings on Ebay.

One example

Link with refusal to sell to MN

PLEASE NOTE:

Due to the new Minnesota Bullion Coin Dealer law, Heritage is prohibited from selling any coins directly to Minnesota residents.

Tomthecoinguy · July 28, 2014 1:07AM

<< 

<< If anyone finds examples of dealer websites, or ebay lisitngs that state no sales to MN residents, or something similar to this, please send a a link via pm- I am collecting these types of examples. Thanks. >>

Heritage clearly states this in their listings on Ebay.

One example

Link with refusal to sell to MN

PLEASE NOTE:

Due to the new Minnesota Bullion Coin Dealer law, Heritage is prohibited from selling any coins directly to Minnesota residents. >>

This is Ironic since the listing you selected is for a copper penny and would not even fit under the Bullion law. But it makes sense, if you are not going to mess with the law just make a blanket denial.

BryceM · July 28, 2014 1:22AM

Absurd, but no different than what is happening at all levels of government.

This law is so far beyond ridiculous it probably has a legitimate chance of being modified or overturned...... a rare thing.

CaptHenway · July 28, 2014 2:49AM

<< 

<< If anyone finds examples of dealer websites, or ebay lisitngs that state no sales to MN residents, or something similar to this, please send a a link via pm- I am collecting these types of examples. Thanks. >>

Heritage clearly states this in their listings on Ebay.

One example

Link with refusal to sell to MN

PLEASE NOTE:

Due to the new Minnesota Bullion Coin Dealer law, Heritage is prohibited from selling any coins directly to Minnesota residents. >>

Wow! Talk about Draconian!

DMWJR · July 28, 2014 3:04AM

True. One of my favorites is that professional athletes have to file and pay state income tax in the state in which they play. For instance if Payton Manning plays 3 of his 20 games this year in California (took this from the schedule), he will have to file a return there and allocate some relative portion of his salary to that as income for California state tax purposes. He may even get taxed on it again in his home state. Since every state has a different taxing mechanism, there may be gaps or overlaps from state to state based on different methods of allocations. You should see the methodology employed by the State of Tennessee for out of state businesses.

brg5658 · July 28, 2014 3:50AM

<< 

<< 

<< If anyone finds examples of dealer websites, or ebay lisitngs that state no sales to MN residents, or something similar to this, please send a a link via pm- I am collecting these types of examples. Thanks. >>

Heritage clearly states this in their listings on Ebay.

One example

Link with refusal to sell to MN

PLEASE NOTE:

Due to the new Minnesota Bullion Coin Dealer law, Heritage is prohibited from selling any coins directly to Minnesota residents. >>

Wow! Talk about Draconian! >>

I just called Heritage and spoke with someone in their sales department.

Heritage is only stopping the sale of coins to Minnesota residents on their "direct buy" eBay store and on their website when coins are legally owned by Heritage as an entity. Coins consigned for auctions will still be sold to Minnesota residents, as Heritage is only the consignee of said items -- and as such, they are not required to meet any of the requirements set out in the Minnesota Department of Commerce requirements. The legislation specifically excludes auctioneers and online website operators from the need to meet the requirements of sales to MN residents.

In summary,

Heritage Auctions IS still selling items consigned to their coin auctions to Minnesota residents.

TheRock · July 28, 2014 6:23AM

Disregard, I see my answer above on the Heritage ruling.

My bad !!

silverpop · July 28, 2014 7:37AM

so when can I look for your names on the ballot next election in MN?

ms70 · July 28, 2014 7:42AM

"I'm sorry that you mistakenly thought I'm a coin dealer, but I'm not. I'm a collector and investor."

coinguy1989 · July 28, 2014 7:43AM

Forgive my ignorance, but where was this coin show held that the MN officials attended? Was it located within the state of Minnesota?

foodude · July 28, 2014 8:05AM

Yes, the show was in MN; it was held in South St. Paul, MN.

CoinZip · July 29, 2014 11:26AM

I wonder if anyone has contact the ICTA

foodude · July 29, 2014 11:46AM

I wonder if anyone has contact the ICTA

Yes.

foodude · August 1, 2014 11:13AM

A bit more information. The MN Department of Commerce contacted the bourse chair for the show held last Sunday (7/27/14), and today the bourse chair provided the MN Department of Commerce enforcement people with the list of each dealer that attended the show along with their respective contact information.

I know they have been looking at, and contacting MN dealers that have not registered to "discuss their situation", but so far I am not aware of them contacting any out of state dealers. If anyone knows of an example where they have contacted an out of state dealer, and are willing to let me know, please do.

BTW, we are a registered MN dealer and will be at the ANA show next week at Table #231 if you want to stop by and talk about this law.

csdot · August 2, 2014 12:33AM

I read this bill some time back and it was clearly targeting a distinct type of scammer. If you read it you can tell who they were thinking about when they wrote it, and your friendly neighborhood B&M dealer was clearly not the real target. I was sure someone in the legislature would have enough sense to reduce the scope so that innocent dealers would not get unnecessarily covered by the act. Guess I was wrong. How this bill got passed, with such a large net, is a shock to me.

foodude · August 2, 2014 12:47AM

I read this bill some time back and it was clearly targeting a distinct type of scammer. If you read it you can tell who they were thinking about when they wrote it, and your friendly neighborhood B&M dealer was clearly not the real target.

That does seem to be the case.

I was sure someone in the legislature would have enough sense to reduce the scope so that innocent dealers would not get unnecessarily covered by the act. Guess I was wrong. How this bill got passed, with such a large net, is a shock to me.

Several of us tried to provide input to those responsible for getting this this law passed while it was being debated, but from my vantage point they had no interest in listening to any input. I contacted my State rep and talked to a staff person for 10 minutes; she voted against it. I tried to do the same thing with my State Senator (who was on the other side of the political aisle), and she had would not even talk to me about it- would not even listen. I also tried to talk to the person in the AG's office that was helping with the bill, and again would not talk to me about it.

ms70 · August 2, 2014 12:49AM

<< .....the bourse chair provided the MN Department of Commerce enforcement people with the list of each dealer that attended the show along with their respective contact information. >>

Shame on him for complying.

7over8 · August 2, 2014 12:54AM

<< Only 19 dealers at a local show, and a state representative shows up to investigate. That really is draconian. >>

Rediculous. Time for early retirement for that guy.

foodude · August 2, 2014 1:05AM

Shame on him for complying.

Given the enforcement provisions in the law even on one that materially aids in a violation, and the options the State has against that person, not complying may not have been a good idea.

rkfish · August 2, 2014 1:15AM

sounds like a good time to be a paper money dealer or specialize in copper, or the nickel series!

ebaytrader · August 2, 2014 1:26AM

<< It's nice to know that the state of MN. is crime free, and they can now spend their time policing coin shows. Why else would they be spending their resources on this activity? >>

Everyone knows that filling out government mandated paperwork prevents crime.

Seofo · August 3, 2014 2:06AM

Wouldn't surprise me one bit if the Minnesota Gestapo sends some of their goons to the ANA Show in Chicago to try and set up, or at lease to harass, some of the non-Minnesota dealers. Being only a five hour drive from the Twin Cities, there will most certainly be a lot of Minnesota residents at the ANA buying and selling. I can just see it now them telling all the dealers at A.N.A. they are violating the Minnesota Law if they sell to a Minnesota resident. They also may want to consider bringing their own body bags.

Purfrock · August 3, 2014 3:14AM

Extremely frustrating. I can't add much to what others have already said. Thanks for keeping this issue in spotlight.

messydesk · August 3, 2014 5:06AM

So are any Twin Cities shows going to be moved 15 miles east across the St. Croix to Hudson, WI?

MN Department of Commerce Visits Coin Show Today (7/27/14) 8/1/14 Update Added

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